B2B Integration : A Practical Guide to Collaborative E-commerce

Business Process Management (BPM) 145
TSMC: BEFORE AND AFTER —
A COMPELLING DIFFERENCE
Taiwan Semiconductor Manufacturing Company (TSMC) is the world's
largest contract manufacturer of integrated circuits, offering its
customers turnkey services from design and fabrication through test
and assembly. TSMC has revenues in excess of $1.5 billion and has
400 customers around the world. TSMC offers custom-made integrated
circuits for its customers. The business environment in the integrated
circuit industry requires short product life-cycles, growing customer
demand and an increasing need to differentiate itself from its
competitors by offering value-added services.
In the past, TSMC found that its methods of communicating with
customers and suppliers, which included its Website, fax, e-mail,
FTP, EDI, etc. were slow, time-consuming and limited in the volume
of information and the timelines with which they could transmit the
information. These inefficient communication methods were creating
delays along the supply chain.
In 1997, TSMC choose Extricity B2B for improving the way it
interacted with its customers and, also to incorporate the customers
in its internal processes at the manufacturing stage. The automated
and shared business processes were in the area of collaborative
engineering, forecast sharing, order management, WIP (work-inprogress)
updates, shipment notifications, linking back to its own
suppliers. With these areas of shared processes, TSMC was able to
achieve significant improvements in customer satisfaction and supplychain
efficiencies. Customers now have the information that they
require, whenever they require, in the format required, in and through
their enterprise systems. Apart from reduction in TSMC's customer
lead-times by up to 25% and elimination of manual processes, there
has also been a reduction in WIP inventory carrying costs and improved
capacity planning. Based on total project costs and quantifiable
benefits, TSMC had a return of 14 times on its investment in the first
three years.
With Extricity B2B, TSMC has implemented a business-to-business
integration solution to connect its suppliers, contract manufacturers
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