Hewlett-Packard

Hewlett-Packard was founded in 1939; the company has been a technology pioneer and has developed a reputation for exceeding customer expectations by providing the most innovative technology product available. HP wanted to continue this legacy by leveraging the power of the internet to provide customers with easy and convenient access to its products. By establishing its consumer e-commerce store, HP not only recognized that it could strengthen customer relationships and reduces costs, but increases revenue growth and successfully manages demand. HP online stores was launched in early 1988, and experience revenue growth of over 500% annually. HP decreases returns cycle time by 80% and per unit return products costs by 70% through FedEx Return Manager. Online status tracking offers complete visibility throughout the returns process.

OPERATIONAL EFFICIENCY HP Supply Chain Management for business intelligence enables you to enhance your supply chain management more effectively by taking advantage of the HP global methodology, reference data models, ETL templates, and analytic use cases that act as delivery accelerators. By connecting the intelligence across your business ecosystem, you can gain a more detailed

Page 1

understanding of your end-to-end supply chain, achieve greater operational efficiency, and optimize your business processes.

Key features

Better sales and operations planning Inventory optimization Reduced capital spending Improved risk management Supply network optimization

First, develop a thorough understanding of the problem Preliminary data analyses are useful to understand availability and quality of data. Design for supply chain management Design products and production processes with supply chain in mind.

GOING DIRECTLY TO THE CUSTOMER:HP, having sold the majority of its consumer products through traditional retails channels, recognized the opportunity to capitalize on the direct distribution model. HP also wanted to focus on substantially reducing its refurbished product inventories and addressing its customers growing desire to order product via the internet. The creation of a new online sales channel for customers, now known as hpshopping.com, would enable them to capture a large share of sales, enhance its relationship with customers and complement its existing network of retail distributors. Management of hpshopping.com turned to FedEx to help them strategize and quickly implement the new internet sales channel with minimal resource utilization the risk. Hpshopping.com asked FedEx to develop a comprehensive solution that would manage the entire process- from order management to order fulfillment.

HP WANTED TO PROVIDER THAT COULD DO IT ALL: Analyze business processes, assess opportunities and recommended the solution.

Page 2

Integrate multiple solutions from various alliance partners with HP business processes to meet customer needs. Overseas the supply chain and information management components of the solution, thus freeing HP to focus on strengthening customer relationships.

SUPPLY CHAIN MANAGEMENT SOLUTION1. Need assessment and supply chain analysis 2. In depth solution design and development 3. Order management 4. Warehouse management 5. Inventory management 6. Order fulfillment 7. Reverse logistics management NEED ASSESSMENT AND SUPPLY CHAIN ANALYSIS Once Hewlett- Packard made the decision to establish a new e-commerce channel for its customers, FedEx brought in cross functional terms of professionals to assess HPs supply chain architecture and identify critical integration points. Each team worked closely with key areas across HPs supply chain to determine key strategies that would enable the company to meet the growing customer demands for its products. IN DEPTH SOLUTION DESIGN AND DEVELOPMENT After FedEx and HP identified opportunities for the creation of the e-commerce sales channel, a cross functional team from FedEx began the design and development of a Direct-To-Consumer solution for HP. This solution created a new channel for HP that would allow the company to sell its refurbished printers and computing products to customer through the internet. ORDER MANAGEMENT Order management is a critical component in a communications service provider's (CSP) fulfillment processes. As multi-play services become ordinary and services continue to converge, CSPs face numerous challenges. They must grow revenue and market share, increase operational efficiency, and retain existing customers; all the while transforming business processes. HP Order Management solution offer CSPs a new approach to these challenges. Based on the Concept Wave Order Care product suite, HP Order Management

Page 3

automates order to cash processes and eliminates order fallout. With HP Order Management, CSPs can enable positive customer experiences from start to finish. HP Order Management solutions allow CSPs to process and fulfill orders quickly and efficiently. They readily integrate with other BSS and OSS applications, allowing CSPs to maximize current investments. With best practices in wholesale, mobile and triple play, HP can help CSPs deploy Order Management quickly and with less risk

WAREHOUSE MANAGEMENT Because hpshopping.com wanted to establish an e-commerce channel without having to increase personnel and capital expenses, it was necessary to provide comprehensive warehouse management services. Through the FedEx fulfillment center in Memphis, FedEx provided hpshopping.com with the resources necessary to achieve such a requirement. The fulfillment centers close proximity to the FedEx Super Hub enables hpshopping.com to enjoy a variety of benefits associated with the elimination of the inbound transportation leg to the FedEx Super Hub. INVENTORY MANAGEMENT Through the integration of order management inventory management systems FedEx enabled hpshopping.com proactively monitor and control product inventory levels. By integrating those systems from hpshopping.com and the third party call center, FedEx was able to develop a totally seamless inventory management application. ORDER FULFILLMENT In order hpshopping.com increase responsiveness to its customer base, FedEx placed both refurbished and finished goods inventories in the FedEx fulfillment center, located in Memphis. Late cut-off time enables hpshopping.com customers to order as late 10:00 pm and still have their order shipped the same day. In addition, hpshopping.com customers benefit by having multiple pieces arrive in one coordinated delivery instead of receiving multiple shipments. REVERSE LOGISTICS MANAGEMENTIn July 1999, hpshopping.com needed to improve the turnaround of time sensitive

Page 4

customer returns. By streamlining the way product is handled between customers and the returns facility, a speedier returns management service was implemented. Hpshopping.com was to remain focused on customer satisfaction by providing customer with an efficient product return process. Such a process enabled hpshopping.com to quickly credit its customer accounts and help them select products that fulfill their needs. FedEx returns manager provided a return logistics solution that enabled the fast return of product from customer, helping hpshopping.com to maintain visibility to returned products in transit and strengthen customer relationships.

HP offers 10 Tips to 'Getting Useful Supplier Feedback':1. Agree to formal and informal feedback from suppliers 2. Formal feedback can occur meeting with suppliers - such as monthly with strategic suppliers, quarterly with partnership suppliers and annually or semi-annually with transactional suppliers 3. Informal feedback can take place on a much more regular basis (even daily), via phone calls, emails and personal interaction 4. Consider designating an executive sponsor/champion to each strategic supplier, who talks with suppliers frequently and provides opportunities to share informal feedback 5. Create a formal process to assess supplier feedback. The first step should be to determine if the idea is worth pursuing. If so, come up with appropriate actions, and arrange for a team to work on those actions 6. Change may involve not much more than tweaking an existing process, not completely restructuring it 7. Respond to the supplier to let them know you are working on their idea

Page 5

8. Implement the actions. Then provide the supplier with a way to provide feedback on the change 9. Be sure to get back to suppliers if you decide not to take any action on their recommendations 10. Finally, keep the whole process in perspective, remembering that it is designed to continue building stronger supplier relationships

PARTNERS RELATIONSHIP MANAGEMENT

Hewlett-Packard (HP) sells a number of products such as PCs, servers, laser printers, PDAs & storage solutions through the channel. The ePoints program is part of HP's global Partner One initiative that aims at increasing interaction with channel partners and their sales team.

THE PROBLEM:Through the ePoints program, HP aimed at: Directly connecting to sales representative, knowing them and motivating them to sell more of HP products. Developing a common communication platform for informing sales representative of different types of promotions. Designing a cost-effective platform for running channel promotions.

THE BUSINESS CHALLENGE:Accomplishing a partner relationship management program which will facilitate enhanced relationship with sales representatives

EFFECTS OR BENEFITS BY ePoints:-

After implementing the HP ePoints program, HP has managed to engage thousands of final tier channel partners and individual sales people.

Page 6

 Using segmented information, HP knew exactly which category of sales person to spend its marketing costs on. The maximum budget was allotted to the small and middle reseller. In due course of time, the investment on each sales person decreased while loyalty and revenues increased. The strong communication network of ePoints resulted in faster delivery times and reduced average response times by half.

THANK YOU

Page 7