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April 26, 2006
GLOBAL TRACKING PROCESSES DETAILED IN COMPREHENSIVE NEW WHITE PAPER
Beganto and Ten Component Suppliers Share Insights
Standard business processes for global tracking of designs from inception to fulfillment are detailed in a new white paper just published by Beganto, Inc., as the first documented set of step-by-step recommendations for a common platform which can be applied by component suppliers, their reps and distributors, and their OEM customers, to improve communication, productivity and profitability. The recommendations follow from the analyses of the tracking problem highlighted by NEDA and ERA, and take into consideration the limitations of proprietary database solutions, which are expensive and impossible to leverage across the supply chain. Copies of the white paper are available on request; email support (at) Need-A-Sample.com.
Although both trade associations have been addressing the need for split commissions for over two decades, and secured a strong consensus in the U.S. components industry to support Point of Sale (POS) reporting, the need for tracking has now become critical because of the geographic diversity of the component sales cycle. With the point of design, the point of purchase, and the point of manufacture likely to be in different sales territories, and even on different continents, they now require the involvement of different rep firms or different subsidiaries of a multinational organization.
The Beganto White Paper examines the dilemma, using the ERA Split Commissions recommendations as a starting point. With POS reporting, it was typical for 70% of the commission dollar to be paid at the point of design-win, and 15% at both the point of purchase and the point of manufacture. Without tracking, the "wrong" rep (typically at the point of purchase) could have received 100% of the commission.
Challenges to tracking designs include poor business policies, disparate sales/distribution patterns in various parts of the world (e.g., stocking resellers prevalent in much of Asia and Europe), regionalized corporate P/L structures, need to accommodate both outsourced and direct sales organizations, and the huge costs of developing effective proprietary systems coupled with the impossibility for reps and distributors to adequately support the multiple systems of multiple vendors. These issues are exacerbated by the prevalence and purchasing policies of EMS and international procurement offices in the global electronics economy.
In analyzing the problem and developing recommendations and software applications to ameliorate the complex situation, Beganto worked closely with ten component suppliers, and the White Paper is built on their inputs, says Sunil Grover, Beganto's CEO. Grover acknowledged thfe role of ALPS Electric (USA), Catalyst Semiconductor, Fox Electronics, Hirose Electric (USA), JAE Electronics, Macnica (USA), Kyocera LCD Division, NJR Corporation, Optek Technologies, ROHM Electronics USA, and Wieland Electric in sharing their experiences and processes, and in contributing ideas that can be utilized industry-wide.
Solving these problems with standard business processes benefits customers, reps, distributors and component suppliers. The solution outlined in this paper has three main components. It starts with a critical mass of suppliers defining their global split commission policies. The paper then outlines the standard business processes recommended for global tracking of the sales cycle through the design, procurement and manufacturing phases. Finally, adopting a web-based database and software application that tracks the progress along these standard business processes and alerts or follows-up with the right individual(s) is a critical component of the solution. The paper recognizes and responds to the diverse needs of the functionaries at all stages of the process, on both the sell-side and the buy-side.
The fundamental premise of these standard business processes, and the system that Beganto has developed to address the core issue, is that the profitability of all parties - including the customer -- improves when the sales and design support function is properly motivated by being properly compensated.
While many component suppliers are dealing with tracking and compensation issues to their own satisfaction, others are coping in a mode of frustration - and it is these whom Grover invites to review the new document, possibly as a prelude to inviting a Beganto consultation and a no-charge, no-obligation trial of the Beganto system.
Complete information about the Open Search Engine, Need-A-Sample® , BeON™ , Design Winner Premier™ , and Beganto are available at www.beganto.com . Printed literature is available from Beganto, Inc., 48521 Warm Springs Blvd., #306 , Fremont CA 95439 , phone 510.687.5111, fax 510.226.6188, email info (at) beganto.com
About Beganto:
Beganto, Inc. (www.beganto.com) provides the electronics industry a sophisticated web-based system that gets industry participants needed information for selecting, sampling, sourcing, and tracking products through the supply chain. BeON™, the Beganto Open Network, welcomes engineers, buyers, distributors, and manufacturers’ representatives as members at no charge, and lets them enjoy the full features of the system. Component manufacturers become members of BeON™ through paid use of Design Winner™, which facilitates tracking component opportunities from sampling to the point of design win. The privately held company has its headquarters in Fremont, California, and offices in Seattle, India and Japan.
BEG6008 NR, White Paper
April 26, 2006
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