The Fundamentals of Oracle Supply Chain Management

As you look to optimize your supply chain management processes, implementing a robust technology solution is critical to success. Oracle Supply Chain Management Cloud provides an integrated platform to plan, source, make, deliver, and return products and services.With Oracle SCM, you gain real-time visibility across your supply chain to make faster, data-driven decisions, reduce costs, and improve customer satisfaction.

The key components of Oracle SCM include planning, sourcing, manufacturing, maintenance, quality, logistics, order management, and finance. Together, these tools provide a comprehensive solution to manage your supply chain end-to-end. From planning raw material needs to delivering finished goods to customers and handling returns, Oracle SCM has the capabilities to support your most complex supply chain requirements with a modern, innovative platform built for the cloud.

With nearly 40 years of experience helping companies optimize their supply chain operations, Oracle provides a proven, trusted solution to tackle your biggest business challenges. This article explores the fundamentals of Oracle SCM and how its robust features can help transform your supply chain into a competitive advantage.

Oracle Supply Chain Planning

Oracle Supply Chain Planning (SCP) is a suite of applications that enable companies to optimize their supply chain by synchronizing demand and supply. SCP provides solutions for demand planning, supply planning, production planning, global order promising, and collaborative planning.

Demand planning helps generate accurate forecasts based on historical data, predictive analytics, and market trends. It allows you to develop forecasts at multiple levels - item, customer, channel - and for different time horizons. Supply planning uses these demand forecasts along with supply constraints and business rules to determine the optimal supply plan. It ensures you have the right inventory at the right locations to meet demand.

Production planning schedules raw materials, resources, and production activities. It generates master production schedules and material requirements planning reports to support make-to-stock, make-to-order, and mixed-mode manufacturing environments. Global order promising provides real-time visibility into inventory and resource availability across locations so you can set reliable delivery dates for customer orders based on manufacturing and distribution constraints.

Collaborative planning enables internal teams and external partners to jointly review forecasts, identify and resolve supply-demand mismatches, and synchronize plans. It fosters coordination across the extended supply chain to build consensus on a single set of numbers.

With Oracle SCP, businesses can align demand and supply, optimize inventory levels, maximize throughput, improve customer service, and ultimately drive a competitive advantage. By translating demand signals into a feasible supply response and synchronizing plans across departments and trading partners, Oracle SCP helps companies achieve operational excellence.

Oracle Procurement

Oracle Procurement is a comprehensive solution for streamlining and automating the procure-to-pay process. It provides tools for -

1. Sourcing and supplier management. You can create and maintain supplier profiles, record supplier qualifications and certifications, monitor performance, and source new suppliers. This helps ensure you have a qualified, compliant supply base.

2. Contract management. Create and maintain purchasing contracts with suppliers to lock in pricing and terms. Contracts can be linked to specific requisitions and purchase orders for automated compliance and pricing.

3. Procurement. Create, approve and issue purchase orders to suppliers either manually or systematically via requisition import or punchout catalog. POs contain details like quantities, prices, delivery dates and shipping information to properly procure goods and services from suppliers.

4. Receiving and inventory. Record receipt of goods and services against the purchase order. This updates inventory levels and triggers accounts payable. Non-catalog items can also be received and added to inventory.

5. Invoice management. Match supplier invoices to corresponding purchase orders and receipts, then process approved invoices for payment according to payment terms. This helps ensure on-time, accurate payments to suppliers.

6. Reporting and analysis. Gain insight into procurement metrics like spend under management, savings achieved, and supplier performance. Use this intelligence to optimize procurement processes and supplier relationships.

With robust functionality for the complete procure-to-pay lifecycle, Oracle Procurement provides an integrated system for efficiently and strategically managing your supply base and procurement operations. By automating processes and enabling data-driven decisions, it can help significantly reduce costs, improve controls, and strengthen supplier relationships.

Oracle Order Management

Order Capture

The order capture process begins when a customer places an order. Oracle Order Management allows you to capture orders from multiple channels like web stores, contact centers, field sales, and partners. It provides a single view of all orders across channels to ensure consistent order capture and orchestration.

Order Orchestration

Once an order is captured, Oracle Order Management orchestrates the order across your organization and supply chain. It determines order feasibility by checking inventory availability, supply commitments, and other constraints. If needed, it can automatically create substitution or backorder records. Oracle Order Management then reserves inventory, creates shipping documents, and schedules delivery.

Order Fulfillment

To fulfill orders, Oracle Order Management integrates with Oracle Warehouse Management to pick, pack, and ship the order. It prints pick slips and packing slips and confirms shipment details like carrier and tracking number. Oracle Order Management also handles order splitting, where parts of an order are fulfilled separately, and order consolidation, where multiple orders are combined into a single shipment.

Order Status and Visibility

Oracle Order Management provides real-time visibility into order status across channels. Customers can check order status on the web, and customer service representatives have a single view of orders, inventory, shipping, and more to address customer inquiries promptly. Oracle Order Management also proactively notifies customers of key order events like shipment or backorder.

Order Financials and Billing

Oracle Order Management integrates with Oracle Receivables to bill customers and account for revenue. As items are picked and shipped, Oracle Order Management provides item costs and shipping charges to Oracle Receivables for accurate and timely billing. It also handles order holds, cancelations, and returns and works with Oracle Receivables to process the required debit memos, credit memos, and refunds.

In summary, Oracle Order Management is a robust solution that helps businesses efficiently capture, fulfill, and account for customer orders across channels. By orchestrating the flow of orders through an organization, it provides a superior customer experience and optimizes your supply chain operations.

Oracle Inventory Management

Inventory Management

Oracle Inventory Management is a key component of Oracle SCM that helps organizations efficiently manage the storage and movement of materials. It provides real-time visibility into on-hand balances, material locations and inventory costs to optimize stocking levels and reduce excess inventory.

Maintaining Optimal Stock Levels

Oracle Inventory Management enables you to define minimum and maximum stock levels for each item to ensure sufficient supply to meet demand without tying up excess working capital in inventory. You can use historical usage data and demand forecasts to calculate economic order quantities and automatically create replenishment orders when stock reaches re-order points.

Improving Visibility

Oracle Inventory Management gives you a single, real-time view of inventory across all storage locations, whether on-site or at third-party warehouses. You can track the quantity, cost and physical location of all items, see what's reserved or available to promise, and locate any material with a barcode or serial number scan. Enhanced visibility helps reduce out-of-stocks, excess safety stock and manual inventory checks.

Managing Inventory Costs

Oracle Inventory Management lets you apply standard costs, average costs or specific identification to value your inventory. You can perform periodic or perpetual costing to match your business requirements. It also provides reports on inventory value, turns, days of supply and other metrics to identify excess or slow-moving items that may require markdowns or promotions. Tighter cost control leads to improved margins and cash flow.

Integrating With Other Systems

Oracle Inventory Management is designed to operate seamlessly with other Oracle SCM and ERP solutions. It shares information on sales orders, purchase orders, inbound and outbound shipments, and manufacturing work orders with relevant parts of the supply chain. This tight integration helps ensure strong coordination between planning, procurement, production and fulfillment for optimized inventory management.

In summary, Oracle Inventory Management delivers the tools and information you need to gain control of your inventory. By maintaining proper stock levels, improving visibility, managing costs and integrating with related systems, you can boost efficiency, reduce expenses and improve customer service.

Oracle Transportation Management

Transportation Planning

Oracle Transportation Management (OTM) enables you to plan transportation routes more efficiently. It provides modeling and simulations tools to help you determine optimal routes based on parameters such as cost, delivery time, and resource utilization. You can use OTM to plan:

• Multi-stop routes to minimize distance traveled

• Consolidated shipments to reduce transportation costs

• Cross-docking to transfer shipments between vehicles

• Mode of transport selection based on shipment details

Shipment Execution

Once routes have been planned, OTM handles the execution of shipments. It provides visibility into shipment status, events, and milestones in real-time through monitoring and tracking tools. With OTM, you can:

• Generate shipping documentation like bills of lading and packing slips

• Provide carriers and customers details on expected delivery dates and times

• Receive alerts if a shipment is delayed or deviates from the planned route

• Record proof of delivery to confirm when a shipment has been received

Using OTM for transportation planning and shipment execution allows for efficient management of transportation logistics. Resources can be optimized, costs reduced, and the delivery process streamlined.

Carrier Management

In addition to assisting with planning and executing shipments, OTM also helps manage carriers and transportation providers. You can store carrier information like services offered, coverage areas and rates. OTM enables you to:

• Compare carriers based on key performance indicators and lane coverage to choose optimal providers for each shipment

• Negotiate competitive rates based on aggregated shipping volumes

• Track carrier performance and service levels to ensure compliance with service agreements

• Pay carriers automatically and audit payments to verify billing accuracy

Effective management of carriers is key to reducing transportation spend and ensuring high quality service. OTM provides the tools needed to evaluate carriers, negotiate strong contracts and monitor performance.

Overall, Oracle Transportation Management offers robust capabilities for optimizing transportation logistics. From planning through execution and carrier management, OTM can help streamline your supply chain and reduce costs. By leveraging its advanced functionality, you gain visibility and control over the transportation process.

Oracle Global Trade Management

Oracle Global Trade Management (GTM) is a comprehensive solution that helps optimize and automate global trade operations. GTM provides capabilities to efficiently manage compliance with changing trade regulations and optimize the flow of goods across borders.

Compliance Management

GTM enables you to stay up-to-date with complex and frequently changing global trade regulations. It provides reference data on trade regulations, embargoes, and denied parties lists to identify any compliance violations. GTM also allows you to configure and manage compliance checks based on your specific business needs and risk profiles.

Restricted Party Screening

GTM screens transactions against published denied parties lists to prevent illegal trading activity. It checks customer and supplier information against major restricted and denied party lists from around the world to mitigate risk and avoid heavy penalties.

Trade Content Management

GTM provides a central repository for all global trade-related content, including regulations, product classifications, and customer data. This helps ensure that trade professionals have access to consistent and up-to-date information to optimize compliance and facilitate legitimate trade.

Duty and Tax Management

GTM helps determine landed costs by providing the ability to calculate duties, taxes, and additional charges for a shipment based on trade agreements and local country laws. It also supports the filing of import declarations and customs entries to facilitate the movement of goods.

License and Permit Management

GTM allows you to apply for and track the status of critical trade licenses and permits. It provides the ability to configure license and permit types, set up application processes, track approvals, set reminders for renewals, and report on license usage.

In summary, Oracle Global Trade Management is a comprehensive solution that provides capabilities to efficiently manage compliance, optimize global trade operations, reduce costs, and power international growth. By automating and streamlining global trade, GTM enables organizations to improve compliance, minimize risks, and strengthen their competitive position in the global market.

Oracle Supply Chain Collaboration

Collaboration Centers

Oracle Supply Chain Collaboration centers allow your organization to work together with suppliers and customers. These collaboration centers provide real-time visibility into orders, forecasts, inventory positions, and material and service requirements across the extended supply chain.

Supplier Collaboration

Through the Supplier Collaboration portal, you can share forecasts, place and track purchase orders, monitor supplier performance, and resolve issues with suppliers. Suppliers gain access to your forecasts, enabling them to better plan production and inventories. They can also view and acknowledge purchase orders, update order statuses, and communicate directly with your organization.

Customer Collaboration

The Customer Collaboration portal provides customers with real-time access to order information, shipment details, and inventory availability. Customers can view forecasts, place and track orders, check order status, view shipping information, and see current inventory levels for items they purchase. Your organization gains insight into customer demand and can ensure high levels of customer service.

Collaboration Benefits

• Improved supply chain visibility for all trading partners

• Increased forecast accuracy through shared demand signals

• Reduced excess inventories through coordinated planning

• Fewer supply chain disruptions due to real-time issue resolution

• Higher customer satisfaction through transparent order management

• Lower administration costs by automating manual processes

Oracle Supply Chain Collaboration allows you to work closely with suppliers and customers, creating a transparent, integrated supply chain network. By breaking down information silos, all parties benefit from improved data sharing, planning, and execution. Supply chain performance is optimized, and stronger, more collaborative relationships are built with key trading partners. Overall, Oracle SCM Collaboration helps your organization achieve maximum value across the extended supply chain.

Oracle Product Lifecycle Management

Oracle Product Lifecycle Management (PLM) provides a collaborative environment for managing the entire lifecycle of a product from its inception through design, manufacturing, service, and disposal.

Central Repository

Oracle PLM establishes a single source of truth by providing a central repository for all product-related data. This includes items such as product designs, bills of materials, engineering changes, quality issues, and compliance documentation. Storing all data in one place ensures consistency and accuracy across departments.

Role-Based Access###

Access to data in Oracle PLM is granted based on a user’s job role and responsibilities. This role-based security model allows teams to collaborate while protecting sensitive information. For example, designers can access product designs, but manufacturing engineers may only view the bill of materials needed to build the product.

Change Management

As products evolve through their lifecycle, Oracle PLM facilitates the change management process. It tracks engineering change orders (ECOs) and change requests, routing them to the appropriate team members for review and approval. Once approved, changes are automatically reflected in product designs, bills of materials, and other related documentation. This helps companies quickly and efficiently adapt their products to meet changing requirements and customer needs.

Product Costing###

Oracle PLM integrates with other Oracle SCM applications to provide detailed product costing information. It sends product designs and bills of materials to Oracle Cost Management to calculate material, manufacturing, and tooling costs. The cost data then flows back to Oracle PLM to help companies evaluate the profitability of products and make data-driven decisions on product portfolios.

In summary, Oracle Product Lifecycle Management delivers a robust set of capabilities to help companies gain complete control and visibility over their products. By using a single system to manage all product-related data and processes, businesses can boost productivity, reduce errors, and bring high-quality products to market faster.

FAQs: Common Questions About Oracle SCM

Oracle Supply Chain Management (SCM) is a suite of applications that provide end-to-end planning and execution capabilities for your supply chain. As with any robust software, you likely have some questions about its components and functionality. Here are answers to some of the most frequently asked questions about Oracle SCM.

What are the key components of Oracle SCM?

The main components of Oracle SCM include:

• Demand Management: Forecast demand and make demand-driven decisions.

• Supply Planning: Plan material and capacity requirements to fulfill demand.

• Procurement: Source materials and services from suppliers.

• Order Management: Orchestrate the fulfillment of customer orders.

• Manufacturing: Plan and execute production operations.

• Logistics: Manage the flow and storage of goods across the supply chain.

• Product Lifecycle Management: Manage products from concept to end-of-life.

How can Oracle SCM benefit my business?

Oracle SCM can provide numerous benefits, such as:

• Improved customer service through more accurate demand forecasts and order promising dates.

• Reduced costs from optimizing supply plans, minimizing excess inventory, and maximizing capacity utilization.

• Increased revenue opportunities through shorter order-to-cash cycles and faster time-to-market for new products.

• Better visibility and control across supply chain processes with a single, integrated solution.

• Improved compliance with regulations through complete traceability of products and materials.

How does Oracle SCM integrate with other Oracle solutions?

Oracle SCM is designed to integrate seamlessly with other Oracle applications like:

• E-Business Suite for financials, HR, and CRM.

• Transportation Management for freight shipping.

• Warehouse Management for warehouse operations.

• Fusion Middleware for business processes and integration.

• Business Intelligence for reporting and analytics.

The tight integration between Oracle SCM and related solutions provides a comprehensive system to manage your entire business.

Conclusion

As you have seen, Oracle Supply Chain Management encompasses a broad range of solutions to help optimize your end-to-end supply chain. From planning and procurement to order management and fulfillment, Oracle SCM provides the tools and capabilities to maximize efficiency, reduce costs, and improve customer satisfaction. By leveraging the latest technologies in artificial intelligence, blockchain, and the Internet of Things with your supply chain data, you can gain valuable insights to make better strategic decisions and thrive in today's competitive markets. With a robust and integrated system built on a single platform, Oracle SCM delivers the scalability and flexibility to support your growth well into the future. The key is tapping into the potential of these innovative solutions to transform your supply chain into a competitive advantage.