Supply Chain Management Software-as-a-Service: IBM

tart -->can track supply chain execution and respond quickly
IBM aims to practice what it preaches. Theto imbalances, errors and shortages. The scope and
company's early support of fully automateddepth of this visibility is critical to high levels of supply
processes--such as order management, serviceassurance.
requests and OEM manufacturing work orders--hasWorking seamlessly together, the E2open supply
served to improve customer satisfaction andchain management solutions provide IBM and suppliers
operational efficiencies. And over the years thewith a consolidated view of customer demand,
company has remained committed to continuousavailable supply and any imbalances. They allow IBM
improvement through the intelligent application ofto proactively manage demand / supply execution,
new technologies, becoming a model for a fullyinventory and replenishment across IBM's global
automated enterprise using the most advancedsupply chain by providing a more accurate view of
supply chain solutions and practices.supply positions. Through use of the information
IBM defines the next level of business processaggregated by the E2open solution, every supplier
efficiency as an on-demand model: "An enterprisetier has the business data they need to make
whose business processes can respond with speedeffective supply chain decisions.
to any customer demand, market opportunity orTHE RESULTS
external threat." This model requires seamlessThe solution currently extends across 37
end-to-end business process integration of internalmanufacturing facilities and 10 replenishment (VMI)
IBM systems while extending into key partners,service centers, representing more than 85 percent
suppliers and customers.of IBM's annual manufacturing procurement
THE CHALLENGEexpenditures. It provides both IBM and Tiers 1, 2 and
With one of the largest and most complex supply3 suppliers a consolidated view of demand and
chains in the world, IBM spends $41 billion annually onavailable supply.
orders for more than two billion component parts aWith the E2open solution, IBM is able to proactively
year, working with 33,000 suppliers and 45,000manage demand / supply execution, inventory and
business partners.replenishment across its global supply chain, and is
"IBM has long focused on creating and building anable to incrementally scale the solution as more
integrated, end-to-end supply chain," says Kevinsupply chain partners come on board through
O'Connell, IBM's director of manufacturing andacquisitions and expansions.
procurement processes. "Now we wanted to bump itIBM achieved very fast time-to-value with rapid
up to new levels of collaboration. To achieve ourintegration and deployment across global sites and
on-demand goals, we needed to extend integrationtiers of suppliers, lowered total cost of ownership,
of business processes across a multi-tiered supplystreamlined operations, and increased responsiveness
chain and into customer and partner systems as well."and flexibility within their supply chain. IBM estimates
IBM realized that their in-house supply chain systema 50 percent savings on deployment and operations
was not sustainable. With their legacy system, IBMcosts over its existing solution and alternative
relied on suppliers' and partners' reports andapproaches. Business benefits include:
management systems for visibility into its own supply* Reduced supply / demand planning time from 45+
chain. Sourcing compliance by Electronicsdays to 10 days
Manufacturing Services (EMS) providers for IBM core* Increased pull replenishment levels to 85 percent
suppliers was nothing close to real time. Instead, IBM* Improved outbound on-time delivery rates to 90 to
operated in a reactionary mode, relying on EMS95 percent
self-reporting and supplier end-of-quarter information.* Improved inventory turns more than 42 percent
After extended analysis, IBM determined that it* Achieved time to benefit of less than nine months
needed an industry-standard supply chainThese solutions helped IBM in its quest to build a
management solution that allowed for synchronizationhighly responsive supply chain that can meet changes
of demand and supply and visibility into Tier 2 and 3in customer demand rapidly and efficiently.
suppliers and contract manufacturers, for all IBMABOUT E2open
global manufacturing sites and divisions. The solutionE2open is the leading provider of supply chain
had to be flexible and robust enough to supportmanagement software-as-a-service for visibility and
changing customer demand scenarios with proactivecontrol over global supply networks. Industry leaders
supply/demand planning.that power their supply chain with E2open include
THE SOLUTIONAgere, The Boeing Company, Hitachi, IBM, LG
IBM turned to E2open to provide twoElectronics, Matsushita Electric Industrial (Panasonic),
customer-proven supply chain management solutions:Motorola, Seagate Technology, Solectron and
* E2open Demand / Supply Synchronization Solution:Wistron. E2open's software-as-a-service model offers
Enables IBM to sense and respond rapidly to demandfaster payback, larger ROI and reduced risk while
and supply changes--quickly flagging imbalances andrequiring less IT and business resources. Over 15,000
potential shortages. These capabilities allow IBM tocompanies worldwide currently use E2open.
reach its goal of building an integrated end-to-endHeadquartered in Redwood City, Calif., E2open is a
supply chain that responds to demand and supplyprivately held company.
changes rapidly and accurately.For additional information on how E2open can assist
* E2open Multi-tier Visibility Solution: Provides Tier 1, 2you in gaining visibility and control over your complex
and 3 suppliers with consolidated visibility intosupply chain, please visit our website at or contact us
forecasts, commits, aggregate order quantities andat 650.381.3737.
inventory positions--so each tier of the supply chainCopyright 2007 E2open, Inc.