With complex supply chains, SKU proliferation and demanding service levels, life sciences companies stand to gain a competitive advantage by reducing inventory and improving service levels using multi-echelon inventory optimization (MEIO). Such optimization helps supply chain stakeholders achieve lower inventory levels while executing new product introductions cost-efficiently and exploiting market opportunities aggressively. Delve into this white paper to better understand how MEIO can help uncover and release enormous amounts of working capital in excess inventory; model “what-if” scenario analyses to improve the positioning of inventory buffers; build executive support and create a shared understanding of the supply chain, and more.
Of all factors that affect business success over the long term, most executives agree that generating forecast accuracy is right at the top of the list. Basic forecasting can have a powerful impact on an organization’s ability to satisfy customers and manage resources cost effectively. A forecast is not simply the projection of future business. It is a request for product and resources that ultimately affects almost every decision the company makes. That means decisions by sales, finance, manufacturing, logistics and marketing are all enhanced or diminished by the quality of the company’s forecast.
Although basic forecasting isn’t the sole factor, it is the main shaper of how a company serves its customers, capitalizes on opportunities and drives performance. Logility’s experience with hundreds of organizations across many industries shows that typical benefits from a 15% improvement in forecast accuracy can include a 15%+ reduction in inventory, a 10%+ service level improvement, and a 20% increase in order fill rate. Better forecasting is one of the few core competencies that can drive a business agenda. Frustratingly, many companies suffer from common shortcomings that impair their ability to move beyond a basic level of accuracy, where forecasts based only on rules of thumb and simple math are applied to all products in the portfolio.
This white paper explores the common barriers that often stand in the way of an organization moving beyond basic forecast accuracy, and provides suggestions to break through them.
The first step toward successful inventory optimization is getting your internal conversation on the right track by assessing your current supply chain demand planning situation, understanding the potential benefits, and setting your expectations with confidence.
The benefits of multi-echelon inventory optimization (MEIO) have been well established by hundreds of companies of all sizes in industries ranging from consumer products to life sciences, high technology to process and discrete manufacturing. Leading organizations have shown that right-sizing inventory buffers and restructuring where and how inventory is held drives powerful financial benefits and adds tremendous value to the sales, inventory and operations planning (SIOP) process. MEIO provides a knowledge platform for better decision making and lets organizations use inventory as a lever for balancing supply and demand.
Multi-echelon inventory optimization (MEIO) right-sizes buffers and recommends where inventory should be held across all tiers of the supply chain. The benefits of multi-echelon inventory optimization are well established, including reducing inventory while simultaneously raising service levels, resulting in dramatically improved profitability and happier customers. However, some supply chain demand planning teams may need help with the initial internal MEIO conversation.
Supply chain managers seeking to assess the potential financial benefits of an MEIO initiative can start with the high-level process outlined in this white paper. Based on Logility s years of experience, this paper presents a good way to get the ball rolling, with seven simple estimates that help explore the impact an MEIO initiative can have on your organization. This white paper provides some practical guidance on how to have a conversation about MEIO and supply chain demand planning, including helping team members across different departments understand the potential impact on inventory reduction, increased working capital, savings from lower obsolescence, and more.
At the core of every retailer’s omni-channel supply chain is the need to be more flexible when managing inventory. Monthly cycle-to-merchandise planning is no longer adequate to keep up with rapid, short-term shifts in demand. Instead, retailers must make decisions at least weekly, while addressing the specific variables unique to each business segment, including individual stores, e-commerce sites and wholesale partners. Conquering The Omni-channel Inventory Challenge, by online publishing network Retail TouchPoints, explores five important areas where retailers can leverage a single view of their inventory to gain more nuanced, granular control of the business.
A unified global supply chain management planning system is a key factor that facilitates insightful and strategic business decisions. In a time when consumer packaged goods (CPG) manufacturers face the threat of disintermediation by big retailers, restoring power to the brand often means going direct to the consumer via premium outlets, factory stores, ecommerce or omni-channel selling, and even new “store-within-a-store” models. With product variants proliferating and more direct access to the consumer, CPG global supply chain management teams must maneuver astutely around seasons, assortments, promotions, and retail demand signals spanning multiple planning horizons.
Even under the best circumstances, the “bets” planners place on products and materials two, three or more seasons into the future are difficult to make with confidence. Huge sales and margin impacts among many other factors hang in the balance. And once those bets are placed, the ability to respond to changes in retail demand and other factors can literally mean the difference between profit and loss for CPG manufacturers.
Download this white paper and learn how to build a strategic and tactical foundation to support comprehensive global supply chain management and coordinated planning across the short, medium and long-term horizons to fuel profitability and competitiveness.
Merchandise allocation is a key component of retail planning and is crucial for all retail business models. Allocators face a unique challenge: how to place every single item in the best possible retail location at the exact time to achieve lowest possible cost, minimal markdown and maximum profit. Mathematical algorithms can execute retail planning goals and optimize retail allocation store-by-store, channeling the flow of stock according to factors such as available selling space and store sales performance to ensure the right blend of items, styles, colors and sizes are provided while avoiding overstock and out-of-stock conditions.
As a retail planner, you have the merchandise, but can you place every single item in the best possible retail location at the exact time to achieve lowest possible cost, minimal markdown and maximum profit? Whether it is a specific style/color/size in a store for next Friday, controlling the amount of back stock in a DC, reserving units for a catalog based on drop date and unit projection, or planning for the next online campaign, automating and optimizing your allocation strategy can make or break your ability to compete.
Data driven merchandising and assortment plans should be enhanced by automated, on target allocation strategies. A smart, flexible retail allocation process needs a highly capable software to model multiple business services. Solutions come in many shapes and sizes, sourced from best of breed software vendors, ERP system providers, or internal IT departments.
This white paper goes into detail on 10 core ways to automate and optimize the retail planning process, from distribution to store door, for increased efficiency and sales success.
Spreadsheet use pervades every aspect of corporate life and supply chain management efforts. While it’s seemingly easy to get an answer from a spreadsheet, it may not be the right answer. Many spreadsheets are compromised by data and logic flaws introduced by users, and growing complexity can trigger catastrophic problems related to scalability, integration, fragility, siloing, and other actions. Experts agree that basing decisions on a shaky spreadsheet foundation is a major cause of poor performance and failure to meet customer service level goals. Supply chain management teams can find themselves severely hampered by chronic spreadsheet shortcomings when performing mission critical activities such as demand planning, sales and operations planning (S&OP), manufacturing, replenishment and supply planning and inventory optimization.
Spreadsheets provide great benefit, but also create serious issues. It’s easy to get an answer from a spreadsheet but it may not be easy to get the correct answer given:
- General spreadsheet risk due to the limited accuracy of the tool itself
- The risk of data and logic flaws introduced by users
- Spreadsheet-related supply chain risks that emerge as the supply chain matures.
Spreadsheet culture easily spreads into every facet of global supply chain management, without proper security or audit trails, but with an ever-present probability for serious error. Eventually, trying to manage the sheer volume of spreadsheets, trying to generate insights and actionable conclusions within a useful timeframe, and maintaining communication among isolated owner/operators becomes organizationally exhausting.
This white paper provides inspiration for anyone who wants to move beyond the limitations and dangers of spreadsheets in planning, forecasting and optimizing the supply chain.
In a business based on time-limited seasonal harvests, such as a food supply chain, proper manufacturing planning is essential. A full year’s supply for an entire fresh-packed product family must be produced in a few short weeks, while bulk ingredients are also produced in a form that has a longer shelf life, allowing year-round processing to take place. This requires both an accurate long-term demand forecast (to determine the proper mix and quantities of products to be produced) and a constraint-based production planning and scheduling solution (to minimize the impact of constraints and changeovers when processing lines produce multiple product families with different seasonality). The ability to plan for the long term forecast, yet react flexibly to near term changes is essential. The single most important factor is having the ability to model a wide variety of constraints and configurations.
Efficient utilization of capital equipment in may require that the same processing lines be scheduled to produce multiple product families. A constraint-based production planning and scheduling solution in a food supply chain must predict and minimize the impacts of equipment and material constraints and changeovers.
Successful production planning in a seasonally constrained business requires a powerful planning and optimization system that possesses these key capabilities, to name a few:
- Modeling flexibility
- Extended horizon
- Demand forecasting
- Constrained pre-building logic
- Recipe or bill-of-materials
This white paper describes how to develop a food supply chain strategy that balances long-term requirements for materials and finished goods with short-term scheduling that allows plants to execute efficiently, and some of the key planning challenges facing food manufacturers and how a powerful supply chain planning solution can help to address them.
As supply chain teams demand the power of supply chain optimization solutions, the question becomes how best to integrate these powerful solutions with the organization’s existing enterprise resource planning integration (ERP integration) and advanced planning and scheduling (APS) systems. Creating an integrated SCM-ERP ecosystem doesn’t have to be a costly and complex journey, if you choose a path that avoids common pitfalls.
Some dangers are obvious, but others can remain hidden until they suddenly emerge to put the solution at risk.
- Custom integration of SCM with ERP. In this common approach, a development team of in-house IT and outside consultants design, develop, test, implement and support the integration as a unique custom solution.
- Logility’s template-based ERP integration. Logility SCM-ERP integration projects use proven, pre-built data mappings and logic for as much as 90% of the integration scope, while the remainder is configured based on the organization s unique SCM requirements. This approach reduces the timeline, the team size, lowers cost and presents less risk. Logility can deliver high performance ERP-to-Logility integrations in less time and at lower cost, and provide long-term value by continually upgrading software components to maintain currency with data model updates over time.
Common pitfalls that have proven to be hot buttons for integration can be divided into four groups: cost and effort, scalability and speed, sustainability and flexibility
This white paper describes Logility’s template-based integration with ERP systems, using pre-built data mappings and logic for as much as 90% of the integration scope, helps shorten timelines, reduce team size, lower cost and mitigate risk.
Running an entire enterprise from one large suite of seamlessly integrated applications is a powerful vision, and nobody has implemented this vision better than an SAP integration.
Best-of-breed supply chain optimization solutions can increase service levels, minimize inventory, drive fact-based decisions, handle demand uncertainty and supply volatility, and manage product life cycles for maximum profitability. A crucial question is how to integrate these powerful solutions with the organizations enterprise resource planning (ERP) and advanced planning and scheduling (APS) systems. Some dangers are obvious, while others may remain hidden, then suddenly emerge to put the solution at risk. This paper compares two approaches:
- Integration of SAP SCM with SAP ERP using SAP standard integration The standard SAP ERP to SAP SCM integration provides a strong, highly complex, technological starting point for SAP SCM integration. The integration provides near-real-time transfer of data between ERP and SCM, tightly coupled with the SAP ERP data model. The integration is typically implemented over 8 to 24 months using standard SAP project methodology and tools by a team of SAP ERP, SAP SCM and SAP integration and ABAP coding professionals.
- Logility s template-based integration of Voyager Solutions with SAP ERP Logility SCM – SAP ERP integration projects use proven, pre-built data mappings and logic for as much as 80% of the integration scope, while the remaining 20% is configured based on the organization s unique SCM requirements. This approach reduces the team size, lowers cost, and presents less risk.
Common pitfalls for integration fall into four groups: cost and effort, scalability and speed, sustainability, and flexibility.
This white paper discusses how Logility delivers high-performance ERP SAP integration in less time and at lower cost, while providing long-term value by continually upgrading software components to maintain currency with data model updates over time.