Overview on i2 Five.Two SCM Solution Suite

1. Overview on i2 Five.Two SCM Solution Suite Hyun-Woong Jin Global Customer Solution Management i2 Technologies

2. Agenda • Introduction on i2 • Dynamic Value Chain Management • SCM Solution Suite • Implementation Methodology • Case Study

3. i2Mission • $75 billion of value for the customers by 2005 • Based on Value creation • The only company that assesses and monitors the values for the customers • $29.9 billion of value as of 2001

4. i2 is the Undisputed Market Leader in SCM “Once again, i2 Technologies is the only vendor in the Leaders Quadrant…. “ • “i2 maintains its position by exhibiting unrivaled vision and delivering deep planning solutions tailored to vertical industry requirements” Gartner Group Research 2001

5. Industry Leaders are i2 Customers : Over 80% of Fortune Top 1000 Companies are i2 Customers Automotive 9 out of top 10 GM Ford Daimler- Chrysler Toyota Volkswagen Renault Mitsubuishi Fiat Honda BMW Hyundai Motors Chemical 6 out of best 10 du Pont Dow Chemical Monsanto Oxychem Union Carbide Sherwin-Williams GE plastic Eastman Rohm & Haas Polimeri Computer 10 out of top 10 Dell IBM - PSG HP Apple Compaq NEC Acer Gateway Micron Toshiba Semiconductor 15 out of top 16 Intel Samsung Elec. Texas Instruments Motorola Toshiba Philips Micron Hynix Advanced Micro- Devices Amkor Fujitsu IBM National Semi NEC On Semi STM Metal 6 out of top 6 Nippon Steel POSCO British Steel US Steel LTV Timken Steel Data Networking 5 out of top 5 Cisco Nortel 3COM Nokia Lucent Yellow : i2 Customer

6. i2 Korea • Started on Feb. 1997 • Organization : 50 Employees – Pre-Sales / Sales / Localization / Consulting / GCSM • Korean Customers :

7. Agenda • Introduction on i2 • Dynamic Value Chain Management • SCM Solution Suite • Implementation Methodology • Case Study

8. Introducing Dynamic Value Chain Management (DVCM) • It is businessphilosophy • Like “Total Quality Management” was back in 80’s • The main goal is to allow business partners to better collaborate with each other to eliminate the inefficiencies not only within the companies but also between their boundaries to achieve mutual benefits • It embodies workflows, methodology and enabling technology (software) to help value chains better compete in the marketplace In the end, it is value chains that compete against each other in the marketplace.

9. Velocity the Key WeaponAgainst Variability Monitor Velocity Act Decide • How well you fight variability depends on the speed and quality of the following cycle Speed and quality depend on your internal n capability and the cooperation of your customers and suppliers

10. DVCM Basics • DVCM monitoring characteristics • The ability differentiate important from unimportant • Track variability within your company and outside your company • Focus on tracking the appropriate variables. • Forecast and Predictive monitoring. • DVCM Decision Making Characteristics • Integrated decision support at the strategic, tactical and execution level • Decision making response at the speed of business • Constraint driven, multidirectional planning/scheduling • Iterative multi participant planning, supporting what-if scenarios • Event Based Planning to enable realistic commitment • DVCM Execution Characteristics • Enable multi company transaction/state management • Enable embedded decision-making within an execution workflow • Enable alerts to facilitate monitoring of execution to close the DVCM cycle

11. Dynamic Value Chain Management Funnel

12. ERP Single division only No multi Company processing Very slow processing Can not scale Not open Antiquated processes DVCM Total Company Total Value chain Realtime processing Highly scalable Service architecture 100% pull system ERP vs DVCM

13. Dynamic Value Chain Management:The Solution

14. DVCM Different ways to go to market with i2 Five.Two solutions i2 SRM i2 SCM i2 CRM Solution suites i2 Factory Planning & Scheduling i2 Collaborative Supply Management i2 Service Management i2 Transportation, Distribution & Logistics i2 Collaborative Demand Management Solutions • Factory Planning • Scheduling • Allocation Planning • Master Planning • Supply Collab. • Profit Opt. • Forecast Collab. • Promotions Collab. • Merchanidise Planning • Forecasting • Category Price Opt. • Markdown Opt. Business process workflows Products: Supply Collaboration Supply Chain Planner Merchandise Allocator Replenishment Planner Demand Fulfillment Inventory Visibility and Execution Scenario Analyzer

15. Agenda • Introduction on i2 • Dynamic Value Chain Management • SCM Solution Suite • Implementation Methodology • Case Study

16. Some Trends in Supply Chain Management Yesterday’s Critical Success Factors Today’s Critical Success Factors • Pull environment • Power with Consumers • Collaborative Planning • Event driven planning • Hybrid supply chains • Made-to-stock, Made-to-order, Configure-to-order • True understanding of demand shaping factors such as pricing, promotions, and product lifecycle • Collaborative Inventory Management over value chain • VMI, Channel inventories • Competing supply chains • Push environment • Power with Manufacturers • Enterprise-centric planning • Fixed time period planning • Made-to-stock supply chains • Buffer inventory to safeguard against demand variability • Inventory managed within enterprise or pushed to suppliers • Competing companies

17. ERP vs SCM - ERP is a tool providing Backward Visibility by automating Account based Transaction. - APS is a tool providing Forward Visibility by optimizing the utilization of the resources in Supply Chain to maximize the customer satisfaction. Advanced Planning System Enterprise Resource Planning • Transaction processing • Planning and optimization • Generating historical reports • Optimal execution with velocity • Answers “What did we do?” • Answers “What should we do?” • Designed for internal company use • Enables multi-enterprise eCommerce

18. SCM Enabler: APS • APS(Advanced Planning System) is used to find the “optimal” solutions given competing constraints... • Return on assets • Profitability • Customer service • Fixed assets • Capacities • Inventories • Lead times • Labor • Government requirements • Supplier capabilities • Process variability • Labor productivity • Overtime • Premium Freight • Sales incentives • Rebates • Production volume • Production mix

19. APS is Based on Some Simple Concepts... • Synchronous manufacturing and the theory of constraints • simultaneous consideration of constraints (material, capacity, demand, labor, setup, etc.) • coordinated material release and synchronized schedules at each point in the process • Advanced warning of problems • Extensive what-if analysis for dealing with process disruptions (i.e. downtime, absenteeism, late material deliveries, demand mix and volume volatility) • Interactive problem solving and optimization • Marrying the knowledge of the human planner with the speed of the system • Automatic problem solving and optimization • leverage existing legacy systems • Speed • Sequential Planning → Concurrent Planning

20. What is APS (Advanced Planning System)? Develop an accurate, reliable view of market demand by identifying market trends and predicting changes in customer preferences. Ensure that the enterprise is prepared to meet the forecasted demand by generating a constrained, optimal supply plan Demand Planning Value Supply Planning Provide fast, accurate, and reliable delivery commitments to customer orders, and manages these commitments in a profitable way. Velocity Visibility Demand Fulfillment APS involves the effective anticipation market demand, the optimal positioning of enterprise resources to meet demand, and the efficient fulfillment of demand as it is realized.

21. SCM Solution Footprint Demand Planning Supply Planning Demand Fulfillment Forecast and Manage the accurate and reliable market demand Make an optimized Supply plan against the given demand (Product,Material,Capa, Logistics..) Demand Forecasting DP Allocation and Order Promising based on customer classification Forecast Supply Allocation Forecast Netting NettedForecast Allocation Planning Operational Planning DF DF Order Promising FP SCP FP Supply Plan/Allocations DF Latest Available To Promise Supply Plan Order Planning Production and material replenishment plan per each line/facility Order Creation New Orders, Promise Information Frozen Plan FP SCP FP

22. Benefit Improved forecasting accuracy based on consensus. Reduction of the inventory Demand Planning • Objective • Develop an accurate, reliable view of market demand based on the understanding how products are organized and how they are sold • Characteristics • Providing the global visibility. • Multi-Dimension view • Multi-Hierarchy view • Collaboration to make the consensus. • Statistical Estimation or Simulation • Pick Best • Tracking Forecast adjustment

23. Master Planning • Objective • Generate an optimal supply plan (Global Capacity Plan, Product Mix, Material Plan, MPS, Logistics Plan) that helps the enterprise to position its resources to meet the forecasted demand generated by demand planning process • Characteristics • Planning Validity and Optimality • including production, distribution, transportation, procurement. • Planning Velocity • memory resident architecture to execute the planning calculation • iterative What-if simulation • considering diverse objective (facility utilization, inventory, order promising, etc.) • Benefit • Improved Profitability • Improved Facility Efficiency • Reduced WIP

24. Demand Fulfillment • Objective • Provide fast, accurate, and reliable delivery date response to customer orders, and to manage this activity in a profitable way. • Characteristics • Dynamic Order Fulfillment • promise on a dynamic, real-time supply plan • Various Model for Customer/Product Allocation • customer/product based allocation to manage the order in a profitable way • Forecast Netting • prioritizing demands for the optimal allocation • Benefit • Improved Order Promising Capability • Improved Customer Service

25. Production Planning / Scheduling • Objective • Provide PCT for each order and the detailed schedule for each facilities by considering all the constraints on facilities, tools, materials. • Characteristics • Generating a plan considering multiple constraints. • Facility Capacity, Tool, Order Priority, Alternate Material, Batch, etc. • Scheduling • Issuing Work Order • Daily,Shift, Facility • Considering Setup time • Sequence dependent setup time • What-if Simulation • Benefit • Improved Facility Efficiency • Prompt response on Changed Order • Reduced Cycle time • Reduced WIP

26. Average Quantified Benefits Range of SCM (Industry General) • Increase customerservice 5% to 15% • Increase throughput 2% to 5% • Reduce operating expenses10% to 50% • Reducelogistics spend 5 – 20% expenses revenues ROA assets • Reduce inventory (raw, WIP, FG) 10% to 25% • Reduce planning cycle times 70% to 95% • Reduce order lead times 10% to 40% • Reduce production lead times 10% to 50%

27. Agenda • Introduction on i2 • Dynamic Value Chain Management • SCM Solution Suite • Implementation Methodology • Case Study

28. New innovation methodology • Tinkering Approach • Transforming Approach Visioning To-Be Process Design Solution Package Selection Project Implementation Process Consulting Firm’s Involvement Solution Provider’s Involvement To-Be Process Design Visioning Project Implementation Solution Package Selection Process Consulting Firm’s Involvement Solution/Concept Provider’s Involvement

29. i2 Implementation Methodology:TMPM (Trade Matrix Project Methodology) Business Release Activities • Establish implementation strategy through Value Assessment (VA) or Strategic Opportunity Assessment (SOA) • Presents As-Is analysis and implementation road map • Presents implementation benefit analysis (by specific value) • Phase implementation strategy byBusiness Release Methodology • Break down implementation project into manageable phaseswhich are called Business Release (BR): 3~6 months • Each BRdefines clear Business Target (ex: inventory reduction) • Rapid implementation strategy which focuses on realization of specific business value-return • Use ofTemplate • Provides industry specific SCM solution template • Best Practice, Test Plan,Data, and Documents • Reduces implementation period VA / SOA Mobilize Design Develop Accept Go Live SIA Less than 6 Months

30. i2’s Approach to Integration • Through its 9000+ customer implementations, i2 has built a good understanding of various aspects associated with integration. • i2 has come up with a framework that integrates not only i2 internal systems such as SCM, CRM and SRM but also external systems such as ERP and Legacy systems. • Integration needs to be flexible and should allow • Specification of the workflow steps to follow • Configuration at each stage in the workflow based on specific business needs • Integration needs to be extensible • Objective is not only to deliver fully integrated solutions of i2 products covering SCM, CRM and SRM, but also to provide a solution to integrate seamlessly with other packaged applications and legacy infrastructure • The goal is to adopt an integration approach and architecture for integrating diverse systems that will become an integration advantage to customers

31. Common Integration Services • CIS Framework is an i2 abstraction on top of many underlying integration platforms (such as webMethods, Informatica) • It is a set of services enabling enterprise applications to participate in integrated environment • List of services: communication, logging, monitoring, data transformation, workflow design & runtime, single sign-on, etc. • Complete integration framework to interact with any i2 product or 3rd party system. • It is specifying common meta-data format used to simplify TMAPI based collaboration.

32. i2 Integration Architecture Role based Common User Interface OMx IMx ERP Sub-system (SAP) Legacy Sub-system (OS390) Design Source Sub-system SRM Customer Management Sub-system CRM Planning Sub-system SCM … … Transactional Platform Explore ODS Work flow ETL-Bulk Data Transfer (back) Bus Enterprise Messaging (front) Bus Common Integration Services Firewall Public Internet TMOCN Exchanges Hosted Services Content FreightMatrix Trading Partners

33. Agenda • Introduction on i2 • Dynamic Value Chain Management • SCM Solution Suite • Implementation Methodology • Case Study