Sequenz C2: AIRBUS Sup@irWorld eSupplyChain - a collaborative approach

Sequenz C2 AIRBUS Sup@irWorld eSupplyChain – a collaborative approach Executive Summary eSupplyChain - The Sup@irWorld collaborative Supply Chain approach Supply Chain Management of Sup@irWorld provides innovative and enhanced business processes covering requirements, delivery commitments, transport mo- nitoring, goods receipt/quality collaboration as well as invoice status. - Alerts trigger work per exception and eliminates or automates many administrative tasks. - Collaboration allows proactive management and quick problem solving. - The web friendly interface makes it very easy to use, replacing therefore former exchanges and processes. This new web based environment will provide visibility of supply chain data from all ERP systems to the rest of the business and will enable efficient collaboration between all supply chain owners. Abstract Airbus, the market leader in commercial aircraft over 100 seats, has proactively rethought its way of working with suppliers in order to better respond to difficult market conditions, reduce costs, increase visibility and improve reactivity. As one of the results, the Sup@irWorld project has been launched targeting, by using web-based collaborative tools and new harmonised and optimised business pro- cesses, major improvements in efficiency in the way of working with its supplier base. This approach comprises all commodities (including flying and non-flying) and the total information exchange with its suppliers. Sup@irWorld in itself contains 4 domains, which can be accessed by a common portal platform layer with dedicated portals depending on the target audience; either via the employee portal (dedicated as target audience employees) or the Supplier portal www.airbussupply.com for Airbus suppliers. 223 Sequenz C2 Within the Sourcing domain the whole process from identification of a supplier, along the RFx process and possible reverse auctions, to the finalisation of the contract is covered. Buyside is a catalogue based requisitioning application, which allows a wide group of users to select from a standardised catalogue and choose the items to be purchased, to put them into a shopping basket and, by an approval workflow, the purchase orders are created automatically in the ERP backends and sent electro- nically to the supplier. Within the eSupplyChain domain the whole process from expressing needs, via despatch advice, transport tracking, the receiving process & quality part plus in- voice status is covered. This overall area is enriched by some more specific pro- cesses e.g Vendor Managed Inventory and Direct Shipment. The basis for all of those mentioned is the domain, which is called Foundation, providing harmonised and cleansed supplier information, harmonised commodity groups and item cross-referencing or harmonised logistics information to eSupply- Chain, which allow to e.g. aggregate accurate spend and increase visibility. The eSupplyChain project is not addressing a ‘historic problem’ as such, but rather allowing Airbus to present one face to suppliers and at the same time engage in collaborative bi-directional discussions, despite the legacy of previously having been five separate entities with different ERP systems. Given that over 70% of Airbus costs are procured externally, a radical approach was needed in order to achieve a step change in performance and results. The whole concept can be described in a few major statements: § Providing an easy way of sharing information: evolution from a mono-di- rectional to a collaborative solution § Integrating Airbus through a neutral environment • Externally, by building one interface towards Suppliers • Internally, by harmonised information sharing and flows § Managing by exception to allow early detection of problems § Enabling aggregation: Consolidated visibility on stock and demand § Avoiding time consuming researches through a user friendly and central interface 224 Sequenz C2 Another important objective was to implement the solution rapidly in order to drive significant benefits. The project was started in Feb 2002 and went live into a pilot phase 11 months later (February 2003). Several pilot suppliers, which were involved very early in the process, were asked to give feedback on processes and methods used. Within this period, essential leanings were done on Airbus and Supplier side; changes were implemented rapidly, in order to satisfy user require- ments and acceptance. The eSupplyChain hub is based on the exiting ERP backends and delivers com- plimentary functionalities regarding the collaboration and communication. For interfacing with other systems, eSupplyChain is using an Enterprise Application Integration (EAI) layer, to show all necessary transactional information in real time to either suppliers or employees. Mass data is transferred by a slightly different technology (ETL) optimised for handling bigger volumes. In order to ease the use of the application, eSupplyChain is integrated into the common portal platform via Single-Sign On (SSO). Thus enabling, once the user is logged in the private part of the portal, no new authentication/log in into the application is needed. This information is propagated and the correct role is affected, enabling that every supplier/role has its personalised view. Airbus offers various access possibilities in order to ease connectivity and integra- tion (including facilities for data integration): 1. Web-browser access via Internet: This is the standard access and mandatory for treating alerts appearing on the management cockpit. In general all the information visible can be printed in the appropriate and proper format 2. For suppliers treating higher volumes, all the acknowledgements or supplier commitments can be uploaded using a simple structured file or Excel sheet, where the values are interpreted and loaded. 3. For full integration, an Airbus partner connector is provided and installed on supplier site allowing a «pull principle». This means the supplier has full control, which information he gets (via a secured transport), when, and how often - of course within the range of agreed business rules. Since a few months, the pilot phase has successfully finished and the eSupply- Chain hub is used productively. The realisation of the final aim, to significantly re- duce inventory, increase «on time delivery» and minimise risk exposure, has been 225 Sequenz C2 confirmed. During the upcoming years, the solution will be rolled out including the majority of AIRBUS suppliers base. Thus achieving full excellence in operations and quality. Backward looking the most difficult part within the overall project was surely as expected Change Management. Even if written in every book and highlighted by every external support it was still underestimated. In reality it takes a long time to change the mindset and enter into a truly real time collaborative approach. 226