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The Value of Demand Supply Chain Management (DSCM)

The Value of Demand Supply Chain Management (DSCM). Business Drivers. 1970’s Total Quality Management (TQM) 1980’s - 1990’s Lean Manufacturing JIT Kanban (automatic replenishment system) Total Preventive Maintenance (TPM) 1990’s - Into the Millennium

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The Value of Demand Supply Chain Management (DSCM)

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  1. The Value ofDemand Supply Chain Management(DSCM)

  2. Business Drivers • 1970’s • Total Quality Management (TQM) • 1980’s - 1990’s • Lean Manufacturing • JIT • Kanban (automatic replenishment system) • Total Preventive Maintenance (TPM) • 1990’s - Into the Millennium • Demand Supply Chain Management (DSCM) • Collaborative partnership with customers and suppliers • Efficient internal and external flow of materials and information

  3. Order Response Time ? … Lead-time reduction On Time Delivery Cost reduction Customer Requirements Sound Familiar? Answer is DSCM

  4. Xilinx Metrics 1995 Current 1999 Order Entry to Factory Response 3 days 1-2 days <1 day % Auto Scheduled Orders 0% 65% 95% % Lots Die Band-to-Ship < 14 days 5% 60% 75% Meet CSD/within 14 days of order entry 72% 82% 92% The Benefits Measured *** **** ***** Xilinx leads the way !

  5. Distributors Suppliers Xilinx Customer’s & Customers Customers Goods and Services Flow Information Flow Funds Flow What is the Xilinx Supply Chain? All activities related to: planning, purchasing, making, delivering & collecting payment for Xilinx goods & services.

  6. DSCM Buzz Words • Uncertainty • The “Bull-Whip Effect” • Available-to-Promise (ATP) • Replace Inventory with Information • Postponement • Design for Manufacture • Leading-Edge-Procurement (LEP) • Joint Metrics and Scorecard • The Beer Game

  7. Supply Demand Information Information Inventory Inventory Uncertainty Uncertainty Resources Resources Time (Build to Forecast) (Build to Order)

  8. Poor Visibility Poor Information Buzzword: “Uncertainty” Good Information Good Visibility

  9. What the bleep !! Buzzword: “Bull-Whip Effect” Place Order Place Order Place Order Value Add ? Forecast ? Safety Stock ? Value Add ? Forecast ? Safety Stock ? Mr Xilinx

  10. DSCM Stage I: FPGAs are DSCM (Xilinx founded 1984 - ongoing) FPGAs reduce the time to market. In-system programming is the ultimate in postponement. Short off-the-shelf delivery lead times. Design changes made with no penalties. No-risk cost reduction path. Ahead of the Game

  11. Stage II: Improve Internal Systems (Commenced 1995 - ongoing) • Integrate internal processes • Automatic backlog scheduling • Improve accuracy of demand & technology forecast • Reduce cycle time • Move inventory from finished goods to die bank Xilinx DSCM Stages

  12. Stage III: Collaborative Partnership (Started early 1997 - ongoing) • Integrate internal/external processes • on-line lead-time updated 4 times daily • Establish LEP programs where appropriate • e.g. demand pull, replenishment programs • Distributor POS, inventory, bookings on EDI • OEM / end-customer forecasts on EDI • DSCM workshops • Web based system with suppliers • Distribute ATP to supply chain partners

  13. Xilinx leads with DSCM ! * product released after 6 months

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