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[2005-11-25]
Using BPM as the Core to Improve Global Logistics System

[2005-11-18]
Manufactures Use BPM to Achieve Inventory Risk Management and Decrease Unused Materials

[2005-11-11]
Discussion of Introducing Enterprise Class BPM

[2005-11-04]
Selecting the BPM from the Highest Level of the Enterprise

[2005-10-28]
BPMN and BPEL

[2005-10-21]
From SOA and Web Services to POA

[2005-10-14]
When Modern BPM Meets SOA

2007 | 2005

BPM Mini Course.Class7:Applied Analysis of Implementing BPM (2 of 2)

Using BPM as the Core to Improve Global Logistics System

Originally Published in iThome Computer Paper, vol. 218, 2005/11/25

The 21 st century is a century of globalization. Business decision makers are in an ever changing industry environment. They face more complex and dispersed supply chains, consumers with needs that are hard to grasp, better products that have more different types but of smaller quantities, and the shortening of product life cycles. Especially in terms of global competitive strategy, businesses face competition from multinational companies. For a business to survive, it then also has to gradually spread its operations to various locations around the world while increasing internationalized and global logistics ability to effectively utilize resources around the world to lower costs and become more competitive. The CIO needs to realize that many thoughts are different than in the past when under a globalize logistics framework. Below are some points from my previous project implementation experience that readers can make reference to:

Communication Across Organizations

As mentioned by Michael Hammer: “Future business competition is not competition between a company and another company, but is rather the competition of a value chain with another value chain.” If the flow of information can be connected at various points in the supply chain, collaboration partners can more effectively respond to market needs, and at the same time lower inventory risk and cost pressure.

IT is the Foundations of Supporting Business Process Management

Businesses of today must have more flexible and highly responsive processes to respond to the needs of the environment. So can this process effectively integrate and bring to play a collective battle force with high maneuverability? How to monitor statuses of processes from start to finish using the information system, enabling the program to take initative and apply preventive measures, instead of solving the problem after it occurs? These BPM issues are what a highly effective organization must think about. Therefore, the CIO needs to have a more in-depth understanding of the business operations to build an IT architecture that is more effective for business process operations.

Diversified Organizational Management Mechanism

There are many linkage involved in a business with global logistics operations. Regardless whether it is businesses mergers or organizational changes, distributed operations Taiwan , Hong Kong, and Mainland China , global work time zone management, or flexible global inventory allocation, are all detailed features that information systems must have to support the organizational operating needs.

Global Logistics Information Architecture

When considering business information system architecture, it must be raised from a single feature / application level to a strategic level, taking into consideration of the global logistics system to achieve good results with resource distribution, system design, and division of labor for the enterprise.

Using a semiconductor distributor, Wintech Microelectronics, as an example. To maintain competitiveness in industry characterized by low gross margins, high product turnover rates, and short product life, Wintech Microelectronics must expand their operation scale, increase the level of technology, and provide upstream and downstream venders with technical support. More importantly, is to make better use of inventory, lower logistics costs, management of accounts receivables, to effectively utilize resources in lowering operating costs and increasing company profits. Its operation method produced many management problems when confronted with globalization:

Flexible Use and Management of Human Resources in the Global Market.

Faced with a global market, employees of Wintech Microelectronics must travel to places around the world to tighten customer relationships and grasp industry and market trends. This results in a crisscross of departments, inter-regional management levels, and complex distribution of tasks for employees

Global Unanimity, but with more Flexible and Varied Process Requirements

Decisions of IC Distributors must be rapid to effectively and timely win the business opportunity. Therefore bypassing approval processes or for management to complete the work of subordinates when needed is accepted. But this results in problems for system process designers: How to maintain global unanimity while taking into consideration of flexible management.

Integrating Information at Each Location is Difficult

IC Distribution is a capital intensive industry. As the sales volumes continue to increase, at the same time, inventory and accounts receivable also increases. If integration of inventory and capital management information at each location is difficult, then the use of capital obviously cannot be optimized. Furthermore, with untimely information, the information available cannot be used to effectively dispatch products / inventory scattered across each location to optimize cost structure to timely send the correct quality to the correct location.

How to Coordinate with Upstream and Downstream Partners

Global professional division of tasks forces business to operate supply chain / demand chain across geographical areas. IC distributors have IC designers upstream and system assembly factories downstream. In such a large and complex supply chain system, if the process and information system cannot effectively integrate, then the efficiency of the business cannot be realized.

As the sales revenue increases, the organization also increases. The ERP system that was used over the years lack support for multinational operations support. Yet, with a complex system, it is difficult to train users and new employees, not to mention the high maintenance fees. Therefore, Wintech Microelectronics started a comprehensive redesign of their information systems, which the information transformation were done in three steps:

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