Customer Focus

Applied Materials builds large, highly-specialized silicon wafer and solar film

manufacturing equipment for leading semiconductor companies. Customer

order fulfillment is predicated on short lead times, and each final assembly is a

unique build with an average bill of materials (BOM) containing more than

2000 components. Approximately 75% of BOM parts are directly sourced from

multiple suppliers.

Procuring the parts to manufacture this complex equipment can involve as

many as 25,000 purchase orders in process at any time. Updates to

manufacturing requirements planning (MRP) can drive over 30,000 changes to

the suggested date and quantity on open purchase order lines per week. All

order and order change information must be seamlessly communicated to a

global supply chain of more than 400 OEM suppliers and contract

manufacturers with diverse technology integration capabilities.

Applied Materials sought a solution that would deliver improved accuracy of

inbound deliveries in key areas of time, freight levels, quality and quantity,

while reducing inventory levels and costs throughout the direct spend

procurement process.

Applied Materials Challenge

$22M in savings, and

counting–global manufacturer

recoginized as industry leader for

innovative supply chain processes

and controls.

Success Summary

Company Overview

For more than 40 years, Applied

Materials has provided innovative

equipment, services and software

to enable the manufacture of

advanced semiconductor, flat panel

display and solar photovoltaic

products. Applied’s technologies

help make innovations like

smartphones, flat screen TVs and

solar panels more affordable and

accessible to consumers and

businesses around the world.

Applied Materials turns today’s

innovations into the industries of

tomorrow. Applied Materials has

deployed TAKE Solutions’ products

since 1998.

“The speed, cost and quality of information moving between customers

and suppliers is critical to meeting the demands of our end customer.”

– Wendy Reyes, Materials Project Manager, Worldwide Operations, Applied

Materials

Reduction in

order and

change

processing

time.

60%

Results

Awards

About TAKE Supply Chain

As a result of implementing TAKE’s tailored supply chain collaboration

solution, Applied Materials has realized $22 million in savings with an

ROI of nearly 500% and $2.5 million in recurring annualized savings.

Integration throughout demand planning, shipments and supply, and

product engineering enabled saving across the enterprise.

2011 PM100 Progressive Manufacturing AwardHigh Achiever - Supply Network Mastery

10-15% increase in on-time delivery.

30% reduction in premium freight costs.

25-30% reduction in receiving discrepancies.

15-25% increase in warehouse efficiency.

33% reduction in warehouse space.

20-40% reduction in inventory.

Approaching 100% quality control

compliance.

For more than a decade, TAKE Supply Chain has been selected by

leading companies across the globe for solutions that deliver

increased accuracy, visibility and responsiveness across their supply

chains. We offer robust collaboration and data collection solutions

that leverage existing and emerging technology to support the

increased challenges of expanding global supply chains. Together

with our customers, we are regular recipients of supply chain industry

awards for technology, value and innovation.

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TAKE’s Solution

TAKE developed a tailored supply chain collaboration

solution for Applied Materials that delivered accurate,

real-time information and enhanced controls from the

initial order to just-in-time parts delivery for consumption

on the manufacturing shop floor. Xtended Process Control

(X.PC), part of TAKE’s OneSCM® Collaboration Suite, was

selected for its demand planning, procurement, shipping

control and vendor managed inventory functionality. In

addition, X.PC provided for tight integration with Applied

Materials’ ERP data–retaining a single system of record as

well as allowing for Applied Materials’ business rules to be

extended further into the supply base.

Demand Collaborator was installed to enable agile strategic

sourcing. The module provides 12-month forecast

visibility and collaboration with suppliers, including

supplier WIP and inventory visibility, to identify and adjust

for potential shortages months before they occur.

Purchase Order Collaborator was installed to increase the

visibility of purchasing data and make it more actionable

throughout the procurement process. Applied Materials is

able to release and approve purchase orders, review

supplier acknowledgements, apply rule-based MRP

changes to open orders, approve supplier changes and

collaborate on delivery dates, freight service levels and

pricing.

Shipping Controls were implemented to ensure supplier

conformance to shipping requirements into the Vendor

Managed Inventory Depot (VMID). Suppliers are

restricted from printing the order’s barcoded label with a

Package Tracking Number (PTN) until it meets the correct

date window, passes First Article Inspection, and uses an

approved freight level.

Vendor Managed Inventory Depot and Release was

installed to support on-demand materials delivery. A

manufacturing demand pulse is sent to VMID that

triggers order fulfillment through a third-party logistics

provider who delivers parts just-in-time based on daily

assembly line scheduling.