Abstract:
A system and a corresponding method for the logistic management of supply chains of digitally networked suppliers, wherein supply chain participants that are linked directly within the supply chain are identified and grouped, and wherein, on the side of each of the grouped supply chain participants, logistic requirements for fulfilling local supply activities to the other supply chain participant of the group are determined, logistic information between those two supply chain participants exchanged, and the local logistic requirements on the side of each of the grouped supply chain participants dependent on the contents of the exchanged logistic information controlled. The invention enables decentralized management with considerable less efforts than conventional approaches, wherein collaboration and replenishment between collaborating suppliers are accomplished using a network like the Intranet or Internet.

Description:
CROSS-REFERENCE TO RELATED APPLICATION  
       [0001]    The present application relates to copending U.S. patent application, Ser. No. 09/910,544, titled “Network-Based Supply Chain Management Method,” Docket No. YOR920010274US1, which was filed on Jul. 20, 2001 by the same assignee as the present application, and which is incorporated herein by reference. 
     
    
     
       FIELD OF THE INVENTION  
         [0002]    The present invention relates generally to the field of supply chain process management, and more specifically relates to a method and system for managing logistics of a supply chain of digitally networked supply chain participants.  
         BACKGROUND OF THE INVENTION  
         [0003]    Supply chains usually involve multiple companies, working both competitively and cooperatively to produce, transport and sell products to the consumer. The field of supply chains is understood herein to span from initial suppliers of raw materials through transport and assembly of those raw materials, often performed in warehouses or intermediate bearing facilities. Thus, those different raw materials, products or articles have to be transported in due time to manufacturing plants or assembly centers that combine two or more raw materials via processes that lead to intermediate (semi-finished) or even final products.  
           [0004]    Supply chain management further embraces procurement of raw materials and intermediate products, managing storage of such products on pallets or other devices, the warehousing of such products, their transport to intermediate distribution centers, their transportation from such centers to other distribution centers and thence to retailers or the final consumers.  
           [0005]    In general, the dynamics of such a supply chain are highly complex. Among the factors entering the behavior of the supply chain are lead times and order cycle times, often governed by the delays associated with manufacture at each step and transport at each step, the topology of the supply chain as a flow network, the uncertainty in demand from the final consumer either in the absence or presence of periodic promotional sales or one or more stock keeping units available.  
           [0006]    In addition, supply chains must operate within an environment that has market failures including lack of information, externalities, lack of a market, public goods, transportation costs and monopolies. Further, governmental restrictions like pollution laws, taxes for highways and national defense, and laws governing monopolies play an important role for supply chain management.  
           [0007]    In conventional supply chain management each company has to optimize its own piece of the entire supply chain, ignoring any detrimental effects that the decisions may have on its supply chain partners. Accordingly, there exists a need for a supply chain management process that meets the above deficiencies of the existing solutions.  
           [0008]    Another approach disclosed in U.S. Pat. No. 6,157,915, proposes a collaborative management of supply chains. An active collaboration technology in an open architectural framework delivers information and decision support tools in a timely, contextual and role sensitive manner to present a collaborative dynamic decision making capability to a community of role players within a supply chain process. This capability is achieved through the integration of the underlying business process, the organization of the role players and the relevant business applications.  
           [0009]    This approach particularly proposes collaborative creation of a business scenario by role players having permission to access interactive role sensitive documents for supply, production and distribution of a product, submitting the business scenario via the interactive documents on a distributed network, dynamically formulating a business plan based on the collaboratively created and submitted business scenario and nesting and maintaining the business scenario and the business plan in the interactive documents including updates of the business scenario and the business plan in response to the dynamically formulated business plan.  
           [0010]    The above collaborative management approach disadvantageously does not address the particular problem of minimizing the necessary management efforts for managing a complex supply chain infrastructure, in particular in respect of the necessary replenishment cycles on each supply chain level in order to keep the whole supply chain busy.  
         SUMMARY OF THE INVENTION  
         [0011]    It is therefore an object of the present invention to provide an above referenced method and system for managing supply chains which avoid the mentioned drawbacks and provide a simplified supply chain management of even complex supply chain infrastructures.  
           [0012]    It is another object to provide such a method and system which still provide centralized control of an entire supply chain process.  
           [0013]    Yet another object is to provide a computer-implemented supply chain management approach.  
           [0014]    These objects are attained with an above specified method and system by the features of the independent claims. Advantageous embodiments are subject matter of the subclaims.  
           [0015]    The proposed supply chain process includes the steps of identifying at least two supply chain participants in the supply chain being linked directly within the supply chain, grouping the at least two supply chain participants, determining, on the side of each of the at least two grouped supply chain participants, logistic requirements for fulfilling local supply activities to the at least other supply chain participant of the grouped supply chain participant entity, exchanging logistic information between the at least two supply chain participants, and controlling the local logistic requirements on the side of each of the at least two supply chain participants dependent on the contents of the exchanged logistic information.  
           [0016]    The idea underlying the invention is to provide a certain level of supplier collaboration and replenishment, i.e. control of goods movement, by way of logistic information exchange between suppliers directly interlinked within the entire supply chain network and thus to defer responsibility for fulfillment of local logistic supply chain requirements from the supplied company to the supply chain participants, thus to decentralize those local management efforts but to keep control of the entire supply chain process at the supplied company.  
           [0017]    The invention particularly provides a computer-implemented or computer-assisted supply chain management concept where information relating to logistic fulfillment of local supply chain partners within the whole supply chain is exchanged only between those two interlinked supply chain participants. The invention therefore enables decentralized management with considerable less efforts than the prior art approaches wherein collaboration and replenishment between collaborating suppliers is accomplished using a computer network like an Intranet or the Internet.  
           [0018]    According to a preferred embodiment, all supply chain participants have access, via the Internet, to a logistic management database in order to communicate with each other, to exchange the above mentioned logistic information and to exchange supply preview information and goods movement by way of a may be standardized graphical user interface.  
           [0019]    Using the present invention, supply chain partners have only to meet local supply requirements between their direct supply chain partners and not to consider supply requirements of other supply chain partners located in other areas of the entire supply chain. On the other hand, the supplied company has not to be involved in those local supply chain processes and thus has removed the burden from managing the whole supply chain.  
           [0020]    In addition, the supply chain process according to the invention enables an increased exchange of supply materials within a whole supply chain, but decreased transport cost efforts and lower costs caused by grown too old stocks of supply materials, and thus also avoids express deliveries between neighbored supply chain participants required in order to balance supply bottlenecks between those. Further it allows for enhanced logistic flexibility of all supply chain participants and generates improved readiness for supply activities on the side of all supply chain participants. 
       
    
    
     BRIEF DESCRIPTION OF THE DRAWINGS  
       [0021]    Referring to the accompanied drawings, the present invention is described in the following in more detail by way of embodiments from which further features and advantages of the invention become evident, wherein:  
         [0022]    [0022]FIG. 1 is an overview block diagram illustrating a supply chain structure having implemented a supply chain management (SCM) process according to the invention;  
         [0023]    [0023]FIG. 2 is another block diagram depicting a computer-implemented system for managing a supply chain according to a preferred embodiment of the invention;  
         [0024]    [0024]FIG. 3 is comprised of FIGS. 3A, 3B,  3 C, and represents flow diagrams that illustrate a typical multi-tier communication protocol to be used between supply chain participants according to the invention;  
         [0025]    [0025]FIG. 4 is comprised of FIGS. 4A, 4B (formed of FIGS.  4 B- 1 ,  4 B- 2 ,  4 B- 3 ), and  4 C, and represents schematic drawings depicting a graphical user interface structure in accordance with an embodiment of the invention;  
         [0026]    [0026]FIG. 5 is comprised of FIGS. 5A, 5B,  5 C,  5 D, and shows exemplary screenshots of a graphical user interface according to the invention for scheduling, drafting and exchanging logistic fulfillment information between interlinked supply chain participants; and  
         [0027]    [0027]FIG. 6 shows an exemplary Replenishment Service Center (RSC) network environment in accordance with the invention. 
     
    
     DETAILED DESCRIPTION OF PREFERRED EMBODIMENTS  
       [0028]    The supply chain structure schematically shown in FIG. 1 Includes a supplied company  100  and a number of suppliers  102 - 136  A 1 , . . . , An-F 1 , . . . ,Fn. The shown supply chain is used for providing supplies for a device  140  to be assembled out of a number of device modules  142 - 148  at the supplied company  100 . The device  140  to be assembled is assumed to consist of a the multitude of device modules  142 - 148 , each of these modules  142 - 148 , in the present embodiment, provided by a subchain  150 ,  152  of suppliers of the number of suppliers  102 - 136  A 1 , . . . , An-F 1 , . . . ,Fn.  
         [0029]    In accordance with the invention, the whole supply chain is structured into groups  160 ,  162 , each group consisting of only two subgroups, e.g. A 1 , . . . ,An  102 - 106  and B 1 , . . . ,Bn  108 - 112 , or  114 - 118  and  120 - 124  of suppliers which are interlinked or neighbored within the supply chain in the sense that e.g. suppliers B 1 , . . . ,Bn are subsuppliers of suppliers A 1 , . . . ,An, suppliers E 1 , . . . ,En and F 1 , . . . ,Fn are subsuppliers of suppliers B 1 , . . . ,Bn, etc. Accordingly, suppliers D 1 , . . . ,Dn are subsuppliers for suppliers C 1 , . . . ,Cn.  
         [0030]    The logistic coordination between neighbored suppliers (interlinked participants) in the entire supply chain is accomplished by means of logistic fulfillment information exchanged between those suppliers, in the present embodiment using standard document templates  170 ,  172 . The exchanged information is particularly used to co-ordinate local supply processes between interlinked participants in order to avoid supply bottlenecks between locally interlinked participants.  
         [0031]    In addition, identical document templates  174 ,  176  are exchanged between other neighbored supply chain participants within the whole supply chain, e.g. document template  174  between subgroup E 1 , . . . ,En  126 - 130  and subgroup B 1 , . . . ,Bn  108 - 112 . It is to be mentioned that identical document templates  178 ,  180  are also exchanged between a subgroup like A 1 , . . . ,An  102 - 106  and the supplied company  100  in order to let the supplied company  100  keep control of the overall supply chain process.  
         [0032]    The described approach, on the one hand, relieves considerable management efforts from the supplied company insofar as the supplied company does not have to logistically co-ordinate the whole supply chain including all subchains and local subchain partner interdependencies.  
         [0033]    Referring now to FIG. 2, a preferred embodiment of a computer-implemented system for managing a supply chain in accordance with the invention is shown. The underlying supply chain, in this simplified drawing, consists of a supplied company  200  and a number of suppliers A-C  204 - 206 . The whole supply chain hereby is managed using the Internet  208  as communication channel outside the supplied company  200  and using a proprietary intranet  210  inside the supplied company  200 .  
         [0034]    On the side of the supplied company  200 , the whole supply chain is managed using an internal Lotus Notes™ (in the following “LNotes”) server  212  that is connected to an SAP™ server  214 . The SAP server  214  is used to manage the whole supply chain on an administrative level wherein the LNotes server  212  is used to communicate with an external LNotes server  216  that is used to manage the necessary communication between the supplied company  200  and the suppliers  202 - 206  on the one hand and the communication between grouped suppliers as described above, on the other hand. Between the internal LNotes server  212  and the external LNotes server  216  a firewall  218  is arranged in order to secure the supplied company&#39;s  200  intranet  210  against unauthorized accesses from outside.  
         [0035]    The SAP server  214 , in particular, transmits release order information to the internal LNotes server  212 . According to the invention, it additionally delivers replenishment forecast information to the internal Lnotes server  212  which then is further transferred to the suppliers  202 - 206 .  
         [0036]    Outside the intranet of the supplied company  200 , the external LNotes server  216  is interconnected with each of the suppliers  202 - 206  via the Internet  208 . In addition, the external LNotes server  216  is connected to a so-called Replenishment Service Center (RSC)  220  which again is connected to a factory  222  for assembling devices for the supplied company  200  using modules or parts obtained from the suppliers A-C  202 - 206 . These modules or parts are physically transported from each supplier A-C  202 - 206  to the RSC  220  and the factory  222  via common transport channels  224  like known transport service companies.  
         [0037]    The assembled devices are finally transported from the factory  222  to the supplied company  200  via another transport channel  226 , designated herein as “physical goods transfer channels”” Physical transportation of the modules and the assembled devices is managed using a freight server  228  that is connected to the RSC  220  via data lines  230 .  
         [0038]    The entire supply chain management (SCM) process according to the invention is now described referring to FIGS.  3 A-C illustrating a typical multi-tier communication protocol to be used between supply chain participants.  
         [0039]    In FIG. 3A an entire SCM process is shown by way of a flow diagram. The SCM process is performed using a Replenishment Service Center (RSC) application  300  that co-ordinates a replenishment process active on the side of a supplier of each of the defined supplier groups and a refill process active on the side of a respective sub-supplier. A replenishment cycle  302  includes delivery of a regularly sent pull request, e.g. delivered on a daily time basis. A refill cycle  304 , on the other hand, includes a receipt confirmation message sent from the RSC  300  to the sub-supplier, acknowledging receipt of certain supply material.  
         [0040]    Further, in accordance with the invention, the SCM process has involved a forecast strategy in order to forecast supply figures between the two suppliers with a supplier group, e.g. in order to avoid supply bottlenecks between these partners or participants of the entire supply chain. The forecast strategy is divided into an unconstrained forecast process  306  where supply forecast is based on the assumption of unlimited supply capacity on the side of the subsupplier of each group of suppliers. The second part or forecast cycle is a constrained forecast process  308  which, in contrast to the unconstrained forecast  306 , reflects real capacity constraints of the involved subsupplier of the group.  
         [0041]    Now summarizing, the described SCM process provides the following main features:  
         [0042]    Unconstrained and constrained forecast &amp; commitment;  
         [0043]    Scheduled agreement;  
         [0044]    Inventory measurement; and  
         [0045]    Scheduled pull requests &amp; receipt confirmation.  
         [0046]    The above approach enables a standard link between two direct partners of the supply chain. For the exchanged logistic information, data used on a regular time basis, e.g. for daily business, can be taken into account thus providing good data quality and clear responsibility. The approach, in addition, advantageously provides a fully transparent supply chain network in the sense that, for each customer/supplier relation along a given supply chain path, an effective, transparent, real time forecast/commit collaboration is provided.  
         [0047]    According to the proposed SCM business process, each supplier is responsible to qualify its sub-suppliers etc., e.g. using the known ISO 9000 certification.  
         [0048]    In FIG. 3B the basic process flow of a communication protocol according to the invention used between two suppliers on a group level is depicted by way of a flow diagram. With a one day time delay  348 , a tier 2  supplier regularly checks  350  the stock level a the RSC  300 . If the stock level of certain supply materials is below a predefined minimum (MIN)  352 , than delivery of those supply materials from tier 2  supplier to tier 1  supplier is initiated  354 .  
         [0049]    [0049]FIG. 3C depicts a more detailed process and material flow between a tier 1  supplier  360  and a tier 2  supplier  362  shown in FIG. 3B. The communication between the tier 1  supplier  360  and the tier 2  supplier  362  is managed by an above described RSC tool  364  according to another embodiment of the invention, such as described hereinafter in more detail. The RSC tool  364  provides standardized communication between each member of a supply chain group, as described beforehand.  
         [0050]    On the tier 1  level, at first a materials requirement planning process (ERP) is run for evaluating principle requirements for supply materials in the entire supply chain process. In a next step, supply materials requirements within a given (forecast) time interval are forecast. The forecast materials requirements are transferred to the tier 2  supplier using the mentioned RSC tool. Tier 2  supplier, in response to that forecast, produces materials in accordance with that forecast. In a following step, tier 2  supplier checks if the current RSC stack level is below a predefined minimum (MIN). If the current stack level is not below that minimum then it returns to the beginning of that check box via a predetermined time delay that can lie between some hours or several days. If the current stack level is below the predefined minimum, the according supply materials are delivered to the RSC in accordance with the predescribed refill cycle. Tier 1  supplier then can pull these materials according to current production needs from the RSC.  
         [0051]    The above supply chain management process guarantees that the production of materials at each level of the supply chain, e.g. levels tier 1  and tier 2  as described above, is done so that all stock levels are lying within a given supply bandwidth, e.g. sufficient for 10-15 days. The described process step of forecasting supply requirements is mainly used for both, the combination of production of materials at the tier 2  supplier level and control of the above described refill cycle whereby enabling use of the known parameter ‘days of supply’ (DOS).  
         [0052]    FIGS.  4 A- 4 C schematically illustrate an embodiment of a preferred structure of a graphical user interface in accordance with the invention. FIG. 4A hereby depicts a schematic screen  400  of an exemplary tier 0  supplier and the processing of a supply forecast related to necessary materials replenishment (MRP) calculation on its side. The schematic screen  400  clearly illustrates that the RSC application  402  uses a standardized process implemented in an RSC application program that is identical at each tier or layer of the underlying supply chain, which can be better illustrated referring to FIG. 4B. In the present example, the MRP calculation is performed by supplier A and the MRP calculation results, or supply forecast results respectively, are transferred  404  from supplier A  406  to subsuppliers AA  408  and AB  410  in order to fulfill the necessary supply requirements on that supply chain level.  
         [0053]    [0053]FIG. 4B illustrates the further processing of the MRP results of the tier 0  supplier(s)  406  obtained as described in FIG. 4A, the latter results representing the forecast results for the tier 1  suppliers  408 ,  410 , using accordingly standardized RSC screens  412 ,  414  on the side of the tier 1  suppliers  408 ,  410 . These results are further processed by the tier 1  suppliers  408 ,  410  as MRP calculations  416 ,  418  wherein the results of the latter calculations are forwarded  420 - 426  to the RSC applications  428 - 434  of the corresponding tier 2  suppliers  436 - 442 . This procedure is repeated until reaching the lowest supply chain level  444  of tiern suppliers.  
         [0054]    [0054]FIG. 4C schematically shows a sample screen of a Consolidated View  500  i.e. an overview of all relevant supply information from tier 0  to tiern of the entire supply chain. For simplification purposes only, the reverse information flow via the Commitment Line is omitted in the drawing.  
         [0055]    The above described supply chain management (SCM) solution, in addition, can be standardized as a standard process and, for instance, can provide a generic graphical user interface (GUI) as illustrated in predescribed FIGS.  4 A- 4 C. FIG. 5 (FIGS.  5 A- 5 D) summarizes the necessary interaction between all tiers of supply chain levels by way of a sequence of typical screenshots. The shown GUI sequence clearly illustrates grading and networking of all suppliers thus finally revealing the above mentioned Consolidated View  500 .  
         [0056]    The GUI particularly is used by all participants of the entire supply chain. The transparency and structured logistic information exchange along the whole supply chain improves continuity of supply, reduces inventory and increases speed. The particularly described supply chain management certification approach uses common SCM rules which apply to each supply chain participant and thus allow for frequent SCM audits along the entire supply chain. The described ‘Agreed-Upon’ measurements guarantee a robust SCM system.  
         [0057]    The data structure and data fields of the exchanged document templates are the same in each hierarchical supply chain level. The underlying network, nevertheless, allows for consolidation and reporting along any given part of the entire supply chain thus allowing to keep control about the whole supply chain process.  
         [0058]    A typical RSC network environment according to the invention is depicted in FIG. 5 in order to illustrate logistic fulfillment communication between supply chain participants connected to that RSC network.  
         [0059]    On the side of all supply chain participants, including the supplied company, communication between all participants is accomplished using a communication tool. The communication tool is part of the RSC system and automatically creates event driven messages to the participants of the supply chain, i.e. warning that the commitment of specific suppliers is below a certain percentage or a stock level is below a predefined range, or that a new forecast has been posted. The events and addressees of the messages can be defined by the user. The communication tool, in addition, is connected to a database located on the side of the supplied company providing necessary information for conducting the RSC process described above referring to FIG. 3A.  
         [0060]    The communication tools locally implemented at each supply chain participant, in the present embodiment, are directly interconnected with each other wherein the communication lines between two participants being group members of a predescribed supply chain group serve to manage locally supply requirements between those group members locally. In contrast to that, communication lines between participants not neighbored, including the lines between suppliers and the supplied company, are used for consolidation of the underlying SCM process.