Transcript Chapter 2: Enterprise Systems
Chapter 4: The Fulfillment Process
1 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Learning Objectives
Describe the steps in the fulfillment process (Sales and Marketing) Explain the role of different functional areas in efficiently and effectively completing the fulfillment process Identify the key steps in the fulfillment process and the data, document and information flows associated with it Explain the financial impact of the steps in the fulfillment process Explain the role of enterprise systems in supporting the fulfillment process 2 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
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A basic fulfillment process
Definition Order to cash Quote to cash Inquiry to cash All the steps needed to fill a customer order Key concepts and assumptions (Sell from stock or configure to-order) Conceptual Framework Physical flow Data and Document Flow Information Flow Financial Impact Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Key Concepts and Assumptions
Sell-from-stock High volume, low cost products Little choice for buyer Example: iPod Configure-to-order Low volume, high cost products Base model + options Example: computer (Dell, Mac) SSB uses sell from stock 4 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Physical Flow
What is the trigger?
What are the steps? What is the purpose of each step?
Who is involved in each step?
How is communication and coordination accomplished 5 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
A Basic Fulfillment Process
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Document Flow
Customer Inquiry Quotation Customer Purchase Order Sales Order Picking Document Packing Document Customer Invoice Customer Payment Key questions regarding documents What is the purpose?
What are the key data? General: Who, when, what, where Process / step specific: varies How does data change across the process?
Who is responsible for the data?
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Customer Inquiry
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Quotation
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Customer Purchase Order
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Sales Order
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Picking Document
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Packing List
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Customer Invoice
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Information Flow
Instance-Level Information Status of a customer inquiry / order Has the order been acted on? Which step of the process is it in?
Have goods been shipped? When? Where are the goods?
If not, when can we expect shipment?
If shipped, has an invoice been sent? Has payment been received?
Process-Level Information How well is the process doing?
How much time does it take on average? Per material? Per customer?
Which customers are prompt in payment? Who habitually pay late?
What do we sell most? Which customer(s)?
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Financial Impact of the Fulfillment Process
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Financial Impact
Impact on balance sheet and income statement accounts Example: Customer orders $500 in materials.
Process step B/S I/S
Customer inquiry Quotation Customer PO Picking Packing Shipment Customer Invoice Customer Payment 17 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Role of Enterprise Systems in the Fulfillment Process
Execute the Process Create Quotation Create Sales Order Prepare Shipment Send Shipment Create and send Invoice Receive and process payment Capture and Store Process Data Monitor the Process Instance-Level Information Flow Process-Level Information Flow 18 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Enterprise System in Fulfillment
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Customer Order
(not in the book) 20 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Delivery Due List
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Picking document
(Not in book) 22 Magal and Word | Essentials of Business Processes and Information Systems | © 2009
Billing Due List
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Process monitoring (Information flow)
Instance level – status information Status of a customer order (order history) Process level – aggregate information How is the process doing?
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Order history – Completed Order
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Order history– Payment Pending
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Process Level Information
Order Number Order Date
On Time 43%
Delay Causes January 08
Packing Delay 14% Out of Stock 29% Shipping Delay 14%
Order to-Ship (days)
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Exercise Using Simulated SAP
The exercises will take you through the following steps that have been discussed in this chapter: receive customer inquiry create quotation receive a customer purchase order create a sales order prepare the shipment (pick and pack) send the shipment (post goods issue) create a customer invoice receive a customer payment 28 Magal and Word | Essentials of Business Processes and Information Systems | © 2009