Supply Chain and Logistics Management

Overview

A required goal for any business is to convert materials and services into a value proposition that generates profits for the business. In most cases, a company's physical assets exist for this sole purpose. Sustainability and increasing the productivity of these assets are the spaces where Enterprise Applications (EA) is focused. EA solutions include supply chain and logistics management, asset management and asset tracking. Within each of these three solutions, there are a number of business processes, leading-edge technology, and information systems that provide competitive advantages once SAIC provides the delivery of these services to the client. EA provides the full project implementation from setting the scope, project design, project management and implementation to provide step change improvements for those critical business issues that were once thought to be unsolvable.

Supply chain and logistics management provide organizational dynamics of transforming the offering for goods and services into a profitable value proposition for businesses, consisting of building blocks that are positioned into an end-to-end business process. This in turn provides an interdependent approach to work for the business to provide a complete cycle of the offering from taking the order to collecting the payment resulting in a win in the marketplace. SAIC delivers this solution in terms of consulting assistance, software, and implementation dynamics to put in place a winning deliverable for the customer.

Common to all supply chain and logistics management offerings will be a value proposition to declare the objective, the approach, and the benefits. Most will have a defined implementation path including the end-to-end process for providing goods and services at a price and delivery terms that the customer desires and is willing to pay. These steps are an extension of the recognized supply chain operational reference model (SCOR) metrics. For SAIC, they are:

• Plan
• Sell
• Source and procure
• Provide and make
• Deliver
• Settle
• Recycle, refurbish and dispose
• Evaluate

The relationship or the connecting bridge of materials and services to consumption and value generation of the implementation is shown in Figure 1 below.

Value Chain Strategy and Integration

SAIC believes that the business strategy drives the actions of demand activities that will target the selling of goods and services at a price that is profitable for business. This demand then becomes the driver of supply operations. This triangle of strategy, demand and supply is then sustained by a reconciling management process, or sales and operations planning process, that helps regulate over time the expected planned demand to drive the supply capability to reach a profitable, sustainable position. Supply in all cases is inclusive of goods, materials, services and purchased services that are sold to customers. Value chain is the name of this sustainable integrated process of strategy, demand and supply. The business strategy approach will provide a road map to what is necessary to fulfill the mission statement. This will be supported by the market summary, competitive position, financial plan, technology plan, people capability, measurable business goals, and key issues with opportunities facing the mission statement. It is about planning and executing that plan.

Supply Chain

Supply is generally the manufacturing processes between the rawest of materials, through the transformation or manufacturing of those materials and including the final delivery to the consumer. This would include all of the material and labor procurement to produce and deliver these goods and products. Along this path may be many customers who make up specific steps into the greater enterprise. All of the operations processes of manufacturing, production, procurement, maintenance, logistics and delivery would fall in the traditional supply chain. The production processes can consist of a few machines to large multisite integrated processes containing many enterprise assets and operating and maintenance processes. Today we also see supply including the services industries where services are procured and sold and exchanged similar to material goods. Services also include outsourcing services and procured services along with direct services. Services are becoming a large position of the U.S. and global economy. This approach will allow services to be managed in terms of capacity where traditional manufacturing will manage capacity in terms of throughput and capability to produce x units over time. In all cases, performance measurements are required to measure the process and final output of these supply business processes. The SAIC approach is to supply these goods and services based on the demand plan that helps ensure that production is driven by what the customer is willing to pay for goods needed at a given delivery time and place. This is opposed to selling what you make and hoping that a buyer exists.

Demand Chain

Demand drives supply. It can be said that the demand chain is the missing link for sustainable business operations. Supply chains are visible and well-documented. An equal effort must take place on the demand side to achieve a sustainable profitable business. These less visible processes for capturing customer sales can be found in the demand chain. The SAIC demand chain is inclusive of all "customer care" processes, customer selection, channel selection, customer linking, demand planning, forecasting and order receipt through delivering at the time and place requested. This holds for all supplied goods and services. Performance measurement intended for continuous improvement is measured along this order-to-cash process.

Logistics and Delivery

Key supporting processes in logistics and delivery will be the post-manufacturing processes. These will include warehouse management, transportation management and reverse logistics. The latter is a relatively new business process that is aimed at achieving environmental sustainability. It is important today with the recycle, refurbish and dispose choices that attempt to avoid excessive waste of delivered goods. As with all value chain processes, the value is not achieved until the customer declares approval of the receipt of the goods or services and completes their accounts receivable obligations. This approval is further validated with subsequent orders and the completion of the necessary performance metrics.

Enabling Software

SAIC is a leader in identification, selection and implementation of business software necessary to enable supply chain and logistics management, enterprise asset management and asset tracking. SAIC has extensive experience in implementation of ERP-based software from SAP, Oracle, Maximo®, Ventyx and other legacy-based systems. There is no bias in this delivery as SAIC does not produce this type of software. A delivery of business process management is typically included in the software selection and the process identification work. It can include documentation of the as-is and to-be states, which often will require the tools of business process optimization to best enable the software selection. SAIC provides full services from designing the future state and software selection where appropriate, and implementation of both the new process and software where required. SAIC provides a full business process outsourcing offering that goes that next step to help ensure sustainability. Figure 2 shows the interdependency of the full process with the arrows representing the information flow required.