Information Technology Reference
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However, such a plan is normally based on stan-
dard customer lead-times to allow the individual
ERP-plans to create realistic plans at the first
attempt. The option of optimising the joint plan
is therefore primarily based on the difference in
between standard customer lead-time and actual
lead-times in the company.
Solving the challenges related to collaboration
in Non-hierarchical network is not new. A concept
of Extended Value Chain Management (EVCM)
is introduced by Görlitz (2002) as an add-on to
the existing ERP-system. The idea is that the
EVCM acts as a broker in between a customer
and suitable suppliers in the market place. For
the broker to identify one or more suppliers each
SMEs needs to register on the market place. This
solution, however, does not support the option
of adjusting plans in between a customer and a
supplier to enable a mutual (optimal) solution.
The outmost simple solution is therefore to al-
low partners to (manually) view the (production)
plan and based on this utilise/request the available
“free space”. A more far-reaching solution would
be to allow customers to also move low priority
jobs in order to create extra “free space” and
thereby make way for more orders. This solution
requires that jobs and customers are segmented
and assigned a given priority such as illustrated
in Table 3.
Assigning customer priority is a manual task.
Job priorities need to be assigned automatically
to allow the system to work without consuming
extra resources. High priority jobs are typically
related to bottleneck resources or customer or-
ders with little or no slack. Low priority jobs
could either be related to customer orders with
slack or it could be stock orders. Cancellation
or reduction of stock orders (jobs) might lead to
higher costs depending on the details (in case of
high setup costs the ERP-system might generate
a stock order in connection with a customer order
to reduce the total costs).
The planning approach could work in a more or
less manual version where the customer-initiated
changes are updated manually, but a more inte-
grated approach would be more beneficial for
all parties but also more costly. In both cases the
production plan needs to be generated individually
for each partner, allowing him to only view details
of own orders/jobs whereas other orders/jobs only
appear as a coloured (red/yellow/green) anony-
mous job. Further, no matter how information is
changed in the system, the partners in the network
likely request to keep track of the changes made.
VMI vendors have already invented solutions for
this and could be used as an initial source for ideas.
A strong combination of EVCM and the
concept described above might lead to a more
automated Collaborative Demand and Supply
Planning (CDSP) model. This requires that
standard interfaces are developed in between the
ERP-systems and the CDSP, at least in selected
areas such as items and order specifications. The
process of exchanging data involves three steps:
Table 3. Job and customer priority rules
Jobs:
Customers:
High priority
(red)
Low priority
(green)
Medium priority (yellow)
Orders are unlikely to be moved
(customer requests change)
Orders might be moved (cus-
tomer requests change)
Orders can be moved (customer
initiate change)
High priority
Orders are unlikely to be moved
(customer requests change)
Orders might be moved (cus-
tomer requests change)
Medium priority
Orders can't be moved
Low priority
No access to view plans
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