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Article Title:
==============

Supply Chain Management Software-as-a-Service: IBM - A Faster, Leaner, More
Efficient Supply Chain

Article Description:
====================

IBM aims to practice what it preaches. The company's early
support of fully automated processes, such as order management,
service requests and OEM manufacturing work orders, has served to
improve customer satisfaction and operational efficiencies.


Additional Article Information:
===============================

755 Words; formatted to 65 Characters per Line
Distribution Date and Time: 2007-02-15 10:36:00

Written By: R. Jones
Copyright: 2007
Contact Email: mailto:e2open@...



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Supply Chain Management Software-as-a-Service: IBM - A Faster, Leaner, More
Efficient Supply Chain
Copyright (c) 2007 R. Jones
E2open
http://www.e2open.com



IBM aims to practice what it preaches. The company's early
support of fully automated processes, such as order management,
service requests and OEM manufacturing work orders, has served to
improve customer satisfaction and operational efficiencies. And
over the years the company has remained committed to continuous
improvement through the intelligent application of new
technologies, becoming a model for a fully automated enterprise
using the most advanced supply chain solutions and practices.

IBM defines the next level of business process efficiency as an
on-demand model: "An enterprise whose business processes can
respond with speed to any customer demand, market opportunity or
external threat." This model requires seamless end-to-end
business process integration of internal IBM systems while
extending into key partners, suppliers and customers.

THE CHALLENGE

With one of the largest and most complex supply chains in the
world, IBM spends $41 billion annually on orders for more than
two billion component parts a year, working with 33,000 suppliers
and 45,000 business partners.

"IBM has long focused on creating and building an integrated,
end-to-end supply chain," says Kevin O'Connell, IBM's director
of manufacturing and procurement processes. "Now we wanted to
bump it up to new levels of collaboration. To achieve our
on-demand goals, we needed to extend integration of business
processes across a multi-tiered supply chain and into customer
and partner systems as well."

IBM realized that their in-house supply chain system was not
sustainable. With their legacy system, IBM relied on suppliers'
and partners' reports and management systems for visibility into
its own supply chain. Sourcing compliance by Electronics
Manufacturing Services (EMS) providers for IBM core suppliers was
nothing close to real time. Instead, IBM operated in a
reactionary mode, relying on EMS self-reporting and supplier
end-of-quarter information.

After extended analysis, IBM determined that it needed an
industry-standard supply chain management solution that allowed
for synchronization of demand and supply and visibility into Tier
2 and 3 suppliers and contract manufacturers, for all IBM global
manufacturing sites and divisions. The solution had to be
flexible and robust enough to support changing customer demand
scenarios with proactive supply/demand planning.

THE SOLUTION

IBM turned to E2open to provide two customer-proven supply chain
management solutions:

* E2open Demand / Supply Synchronization Solution: Enables IBM
to sense and respond rapidly to demand and supply changes,
quickly flagging imbalances and potential shortages. These
capabilities allow IBM to reach its goal of building an
integrated end-to-end supply chain that responds to demand and
supply changes rapidly and accurately.

* E2open Multi-tier Visibility Solution: Provides Tier 1, 2 and
3 suppliers with consolidated visibility into forecasts, commits,
aggregate order quantities and inventory positions, so each tier
of the supply chain can track supply chain execution and respond
quickly to imbalances, errors and shortages. The scope and depth
of this visibility is critical to high levels of supply
assurance.

Working seamlessly together, the E2open supply chain management
solutions provide IBM and suppliers with a consolidated view of
customer demand, available supply and any imbalances. They allow
IBM to proactively manage demand / supply execution, inventory
and replenishment across IBM's global supply chain by providing
a more accurate view of supply positions. Through use of the
information aggregated by the E2open solution, every supplier
tier has the business data they need to make effective supply
chain decisions.

THE RESULTS

The solution currently extends across 37 manufacturing facilities
and 10 replenishment (VMI) service centers, representing more
than 85 percent of IBM's annual manufacturing procurement
expenditures. It provides both IBM and Tiers 1, 2 and 3 suppliers
a consolidated view of demand and available supply.

With the E2open solution, IBM is able to proactively manage
demand / supply execution, inventory and replenishment across its
global supply chain, and is able to incrementally scale the
solution as more supply chain partners come on board through
acquisitions and expansions.

IBM achieved very fast time-to-value with rapid integration and
deployment across global sites and tiers of suppliers, lowered
total cost of ownership, streamlined operations, and increased
responsiveness and flexibility within their supply chain. IBM
estimates a 50 percent savings on deployment and operations costs
over its existing solution and alternative approaches. Business
benefits include:

* Reduced supply / demand planning time from 45+ days to 10
days
* Increased pull replenishment levels to 85 percent
* Improved outbound on-time delivery rates to 90 to 95 percent
* Improved inventory turns more than 42 percent
* Achieved time to benefit of less than nine months

These solutions helped IBM in its quest to build a highly
responsive supply chain that can meet changes in customer demand
rapidly and efficiently.




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Written by: R. Jones
ABOUT E2open - E2open is the leading provider of supply chain
management software-as-a-service for visibility and control over
global supply networks. Industry leaders that power their supply
chain with E2open include Agere, The Boeing Company, Hitachi,
IBM, LG Electronics, Matsushita Electric Industrial (Panasonic),
Motorola, Seagate Technology, Solectron and Wistron. E2open's
software-as-a-service model offers faster payback, larger ROI
and reduced risk while requiring less IT and business
resources. Over 15,000 companies worldwide currently use E2open.
Headquartered in Redwood City, Calif., E2open is a privately
held company.

For additional information on how E2open can assist you in
gaining visibility and control over your complex supply chain,
please visit our website at http://www.e2open.com or contact us
at 650.381.3737.


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