Collaborative Planning, Forecasting, and Replenishment: How to Create a Supply Chain Advantage

432 Pages·2003·2.87 MB·English

by  Dirk Seifert

COLLABORATIVE
PLANNING,
FORECASTING, AND
REPLENISHMENT
..........................9925$$ $$FM 02-21-0310:45:25 PS
This page intentionally left blank
..........................9925$$ $$FM 02-21-0310:45:25 PS
COLLABORATIVE
PLANNING,
FORECASTING, AND
REPLENISHMENT
How to Create a
Supply Chain
Advantage
Dirk Seifert
AmericanManagementAssociation
NewYork•Atlanta•Brussels•BuenosAires•Chicago•London•MexicoCity
SanFrancisco•Shanghai•Tokyo•Toronto•Washington,D.C.
..........................9925$$ $$FM 02-21-0310:45:26 PS
SpecialdiscountsonbulkquantitiesofAMACOMbooksare
availabletocorporations,professionalassociations,andother
organizations.Fordetails,contactSpecialSalesDepartment,
AMACOM,adivisionofAmericanManagementAssociation,
1601Broadway,NewYork,NY10019.
Tel.:[phone].Fax:[phone].
Website:www.amacombooks.org
Thispublicationisdesignedtoprovideaccurateandauthoritative
informationinregardtothesubjectmattercovered.Itissoldwiththe
understandingthatthepublisherisnotengagedinrenderinglegal,
accounting,orotherprofessionalservice.Iflegaladviceorotherexpert
assistanceisrequired,theservicesofacompetentprofessionalperson
shouldbesought.
CPFR(cid:2)isaregisteredtrademarkoftheVoluntaryInterindustryCommerceStandards(VICS)
Association.
Variousnamesusedbycompaniestodistinguishtheirsoftwareandotherproductscanbeclaimedas
trademarks.AMACOMusessuchnamesthroughoutthisbookforeditorialpurposesonly,withno
intentionoftrademarkviolation.AllsuchsoftwareorproductnamesareininitialcapitallettersorALL
CAPITALletters.Individualcompaniesshouldbecontactedforcompleteinformationregarding
trademarksandregistration.
LibraryofCongressCataloging-in-PublicationData
Seifert,Dirk.
Collaborativeplanning,forecasting,andreplenishment:howtocreate
asupplychainadvantage/DirkSeifert.
p. cm.
Includesbibliographicalreferencesandindex.
ISBN0-8144-7182-X(hardcover)
1. Businesslogistics. I. Title.
HD38.5.S45 2003
658.5—dc21 2002015915
(cid:3)2003AMACOM,adivisionofAmericanManagementAssociation.
Allrightsreserved.
PrintedintheUnitedStatesofAmerica.
Thispublicationmaynotbereproduced,storedinaretrievalsystem,ortransmittedinwholeorinpart,
inanyformorbyanymeans,electronic,mechanical,photocopying,recording,orotherwise,without
thepriorpermissionofAMACOM,adivisionofAmericanManagementAssociation,
1601Broadway,NewYork,NY10019.
Printingnumber
10 9 8 7 6 5 4 3 2 1
..........................9925$$ $$FM 02-21-0310:45:26 PS
Table of Contents
FOREWORDOFTHEVICSCPFRCOMMITTEE xiii
RitaMarzian,cochairVICSCPFR,MetroAG
JimMcLaughlin,cochairVICSCPFR,Gillette
JosephC.Andraski,vicechairVICSCPFR,seniorvicepresident,OMI
International
PREFACE xv
1 EFFICIENTCONSUMERRESPONSEASTHEORIGIN
OFCPFR 1
Prof.Dr.DirkSeifert,HarvardBusinessSchooland
UniversityofMassachusetts
1.1 THEGOALSANDTASKSOFTHEECRCONCEPT 3
1.2 THEREVERSALOFTHEPUSHPRINCIPLETOTHEPULLPRINCIPLE
INTHESUPPLYCHAIN 5
v
..........................9925$$ CNTS 02-21-0310:45:36 PS
vi TableofContents
1.3 ECR—COLLABORATIONFIELDLOGISTICS:SUPPLYCHAIN
MANAGEMENT 7
1.3.1 TheImplementationofSupplyChainPlanning 7
1.3.2 TheGoalsofRetailersandManufacturersBoundtoSupplyChain
Management 7
1.3.3 TheCostSavingsPotentialofSupplyChainManagement 8
1.4 ECR—COLLABORATIONFIELDMARKETING:CATEGORY
MANAGEMENT 11
1.4.1 TheGoalsofRetailersandManufacturersBoundtoCategory
Management 11
1.4.2 TheNine-StepCategoryManagementPlanningProcess 11
1.4.3 TheManagementofCategoriesasStrategicBusinessUnits 21
2 THECPFRCONCEPT 27
2.1 THECPFRVALUEPROPOSITION 27
Prof.Dr.DirkSeifert,HarvardBusinessSchoolandUniversityof
Massachusetts
2.1.1 IntegrationofCPFRintheECRConcept 27
2.1.2 TheBirthofCPFR:Wal-MartandWarner-Lambert’sFirstPilot 30
2.1.3 InstitutionsandOrganizationsofCPFRDevelopment 31
2.1.4 TheCPFRProcessModel 34
2.1.5 CPFRandValueCreation 40
2.2 SALESANDORDERFORECASTSINTHECPFRPROCESSFOR
RETAIL 41
Prof.Dr.GerhardArminger,UniversityofWuppertalandSAF-AG
2.2.1 IntegratedDemandandSupplyChainManagement 42
2.2.2 SalesForecastsforStores,DistributionCenters,andtheCPFR
Process 46
2.2.3 OrderBuildingandForecast 53
2.2.4 IssuesinPracticalImplementation 55
2.3 CPFREMERGESASTHENEXTMOVEMENTINSUPPLYCHAIN
MANAGEMENT 56
JosephC.Andraski,VICSCPFRandOMIInternational
2.3.1 StudiesRevealSupplyChainManagement
Benefits—OpportunitiesandaPathForward 57
2.3.2 ProgressingBeyondSupplyChainManagement 59
..........................9925$$ CNTS 02-21-0310:45:36 PS
TableofContents vii
2.3.3 CPFRasaChangeAgent 61
2.3.4 IndustryStandardsAreCritical 63
2.3.5 CPFRAddressesSeveralKeyPainPoints 65
2.3.6 ImplementationandPaybackCanBeQuick 66
2.4 CPFR—STATUSANDPERSPECTIVES:KEYRESULTSOFACPFR
SURVEYINTHECONSUMERGOODSSECTORANDUPDATES 70
JulieFraser,IndustryDirectionsInc.
2.4.1 SurveyBackground 70
2.4.2 CPFR:TheNextWave 73
2.4.3 ProvenCPFRBenefits 74
2.4.4 PerformanceandChallenges 77
2.4.5 LeveragingDiverseInitiativesandSystems 80
2.4.6 SharingtheKnowledge 84
2.4.7 CPFRImplementation 86
3 CPFRINNORTHAMERICA 95
3.1 MAJORTRENDSINNORTHAMERICANCPFRADOPTION 95
ThomasH.FriedmanandGregBelkin,MoonWatchMediaInc.
3.1.1 CollaborationMeansRestructuringSupplyChainProcesses 95
3.1.2 ScalableCPFRRequiresIncrementalDevelopment 98
3.1.3 ThePowerofOne 100
3.1.4 CPFROptimizationRequiresOrderForecasts 102
3.1.5 CollaborativeEffortsDriveB2BExchanges 104
3.1.6 CaseStudy:Wal-MartInitiatesCPFRwithSaraLee 106
3.1.7 CaseStudy:Schering-PloughReinforcesCollaborativeTrading
Practices 108
3.2 CONSUMER-CENTRICCPFR 111
LawrenceE.Fennell,Wal-MartStores
3.2.1 CurrentRetailEnvironmentandLookingForwardFiveYears 111
3.2.2 It’sTimetoCracktheBooks 116
3.2.3 DefiningCPFR 118
3.2.4 HowDoYouGetStarted? 120
3.2.5 WhatAretheObstacles? 120
3.2.6 WhereDoYouGofromHere? 121
3.3 CPFR—VIEWSANDEXPERIENCESATSAFEWAY 122
ChristopherA.Brady,Safeway
3.3.1 CPFRIsAboutCommunication 123
..........................9925$$ CNTS 02-21-0310:45:36 PS
viii TableofContents
3.3.2 TheApplicationofCPFRatSafeway 123
3.3.3 ImplementationIssues 125
3.3.4 SuppliersChangeTheirExistingProcesses 126
3.4 CPFRIMPLEMENTATIONATACEHARDWAREANDMANCO 127
BrianBastock,Manco
FredBaumann,JDASoftware
ScottSmith,AceHardware
3.4.1 PrimaryBusinessChallenge 127
3.4.2 TheRoleofNewandStandardizedTechniques 129
3.4.3 BenefitsRealized 134
3.4.4 LevelofDifficulty—ChallengestoBeAddressed 136
3.5 CPFRIMPLEMENTATIONATCANADIANTIREAND
GLOBALNETXCHANGE(GNX) 140
GeoffreyS.Frodsham,CanadianTireCorporation
NickJ.Miller,GlobalNetXchange
LauraA.Mooney,Manugistics
3.5.1 WhatIsDrivingCPFR? 141
3.5.2 TechnologyEnablingCPFR 146
3.5.3 MergingofOptimizationandCollaboration 150
3.5.4 TheUseofCPFRatCanadianTire 152
3.5.5 TheUseofCPFRatGNX 159
3.5.6 GNXClientResults:MetroAGandProcter&Gamble 160
3.6 THEPOWEROFSTANDARDS-BASEDCOLLABORATION—THE
UNIFORMCODECOUNCILANDCPFR 162
JosephC.Andraski,VICSCPFRandOMIInternational
MichaelE.DiYeso,UniformCodeCouncil
3.6.1 Standards:TheFoundationforCollaboration 163
3.6.2 Standards:CriticalforBusinessInnovation 164
3.6.3 Collaboration:TheNewCultureofBusiness 165
3.6.4 TheEAN-UCCSystem:GatewaytoCPFRGlobalAdoption 166
3.6.5 DataSynchronization:EssentialforAccurateDataExchange 167
3.6.6 CPFRinAction 169
3.6.7 Standards,Collaboration,andCommunication:Formulafor
SupplyChainSuccess 171
4 CPFRINEUROPE 173
4.1 CPFR:READYTOTAKEOFFINEUROPE 173
Prof.Dr.DirkSeifert,HarvardBusinessSchoolandUniversityof
Massachusetts
4.1.1 MajorDifferencesBetweentheUnitedStatesandEurope 173
..........................9925$$ CNTS 02-21-0310:45:38 PS
TableofContents ix
4.1.2 ECREuropeasaCPFRPacemakerinEurope 174
4.1.3 CPFRGetsRollinginEurope 175
4.2 RESULTSOFACPFRSTUDYINEUROPE 176
NilsWeisphal,IDSScheerAGandUniversityofHamburg/Germany
Prof.Dr.WilhelmPfa¨hler,UniversityofHamburg/Germany
Dr.FerriAbolhassan,IDSScheerAG
4.2.1 DataBasisoftheStudy 177
4.2.2 WhichStrategiesAreCompaniesFollowingwithCPFR? 185
4.2.3 InfluenceofCPFRonthePrevailingCompetitiveSituationin
Industry 192
4.2.4 InternalReorganizationDuetoCPFR 198
4.2.5 Prospects 202
4.3 CPFRINGERMANY,AUSTRIA,ANDSWITZERLAND 203
SaskiaTreeck,Centralefu¨rCoorganisation(CCG)
MichaelSeishoff,Centralefu¨rCoorganisation(CCG)
4.3.1 ECRD-A-CH—ThePlatformforCPFRinGerman-Speaking
Countries 203
4.3.2 TheNecessityofaCPFRManagementPaperfortheGerman-
SpeakingMarket 205
4.3.3 ECRConcept—CPFRBusinessModel 206
4.3.4 SalesForecast 208
4.3.5 Conclusion 214
4.4 CPFRIMPLEMENTATIONATDM-DROGERIEMARKTANDHENKEL
INGERMANY 215
GunterBaumgart,Henkel
Dr.BirgitEster,dm-drogeriemarkt
ChristianSchick,dm-drogeriemarkt
4.4.1 DevelopmentoftheCollaborationBetweenHenkeland
dm-drogeriemarkt 215
4.4.2 CPFRasaFurtherStepintheJointBusinessProcess 219
4.4.3 TheStartoftheCPFRPilot 220
4.4.4 ExperiencesfromthePilotProjectandaPerspectiveonCPFR 224
4.5 CPFRIMPLEMENTATIONATDM-DROGERIEMARKTAND
PROCTER&GAMBLEINGERMANY 226
ChristianSchick,dm-drogeriemarkt
PeterHambuch,Procter&Gamble
4.5.1 Front-EndAgreement 226
..........................9925$$ CNTS 02-21-0310:45:38 PS