This white paper will help SAP customers understand how to gain better visibility into demand, enabling planners to modify inventory to reduce carrying costs without negatively impacting customer-service levels and sacrificing product availability.
The document discusses inventory management and outlines several key points. It describes the need for inventory to address supply chain uncertainties and ensure customer demand is met. It also discusses underlying principles of inventory management, current philosophies like multi-echelon systems, and pros and cons of different approaches. The document then covers theories like Theory of Constraints and metrics like inventory turnover. It emphasizes the need for effective inventory management systems to integrate planning factors and provide real-time visibility.
Multi-echelon inventory optimization (MEIO) models inventory levels across multiple stages of the supply chain. Traditional models plan inventory independently at each stage and can lead to excess inventory build up. MEIO considers the impacts that inventory levels at each stage have on upstream and downstream stages to minimize total inventory while meeting customer service goals. Failing to use MEIO can result in redundant safety stock, customer service failures even when inventory exists elsewhere in the supply chain, and unreliable demand projections provided to suppliers. MEIO determines optimal inventory levels for each stock keeping unit based on factors like demand, lead time variability, replenishment frequency, and desired service level.
This document discusses matching supply with demand by considering both the volume and variability of demand for products. It proposes analyzing demand through a volume-variability profile to classify products into categories. Manufacturing and distribution strategies are then aligned based on this profile. Considering both factors can help minimize inventory levels while maintaining customer service.
Solving For The Supply Demand Mis-Match: Strategy and Case Studykelly12504
Presented at ACS 2004 Symposium. ACS is an educational extension of APICS Region XI representing twenty-four APICS chapters from North Carolina, South Carolina
Supply chain management involves coordinating activities from suppliers to customers. It aims to acquire materials, convert them into finished products, and deliver them to customers. The key is integrating business processes like procurement, production, and distribution. Information and material must flow throughout the supply chain. The overall goal is meeting customer demand efficiently while achieving business objectives like revenue growth, better asset use, and cost reduction. An effective supply chain considers design, planning at strategic, tactical and operational levels, and transaction processing. It requires collaboration across functions to compress time and ensure quality from suppliers to customers.
The document discusses push and pull strategies in supply chain management. It describes push strategies as relying on production decisions based on forecasts, while pull strategies are demand-driven based on customer orders. A push-pull hybrid combines the advantages of both by using forecasts for early supply chain stages and customer demand for later stages. The bullwhip effect and benefits of postponement are also covered. Finally, factors for determining the optimal push-pull boundary based on demand uncertainty and economies of scale are presented.
The document discusses the role of supply chain management (SCM) in hotels. SCM aims to optimize costs in four areas: transaction costs by reducing suppliers and standardizing purchases; product procurement costs by bulk buying and coordination; inventory costs by standardizing products and linking sales and purchasing data; and the genesis of higher costs from customer demands, inconsistent products from many suppliers, and lack of integrated IT systems. SCM seeks to apply lean, agile, resilient and green paradigms to optimize a hotel's supply chain.
Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products. It involves the active streamlining of a business's supply-side activities to maximize customer value and gain a competitive advantage in the marketplace.
The document discusses inventory management and outlines several key points. It describes the need for inventory to address supply chain uncertainties and ensure customer demand is met. It also discusses underlying principles of inventory management, current philosophies like multi-echelon systems, and pros and cons of different approaches. The document then covers theories like Theory of Constraints and metrics like inventory turnover. It emphasizes the need for effective inventory management systems to integrate planning factors and provide real-time visibility.
Multi-echelon inventory optimization (MEIO) models inventory levels across multiple stages of the supply chain. Traditional models plan inventory independently at each stage and can lead to excess inventory build up. MEIO considers the impacts that inventory levels at each stage have on upstream and downstream stages to minimize total inventory while meeting customer service goals. Failing to use MEIO can result in redundant safety stock, customer service failures even when inventory exists elsewhere in the supply chain, and unreliable demand projections provided to suppliers. MEIO determines optimal inventory levels for each stock keeping unit based on factors like demand, lead time variability, replenishment frequency, and desired service level.
This document discusses matching supply with demand by considering both the volume and variability of demand for products. It proposes analyzing demand through a volume-variability profile to classify products into categories. Manufacturing and distribution strategies are then aligned based on this profile. Considering both factors can help minimize inventory levels while maintaining customer service.
Solving For The Supply Demand Mis-Match: Strategy and Case Studykelly12504
Presented at ACS 2004 Symposium. ACS is an educational extension of APICS Region XI representing twenty-four APICS chapters from North Carolina, South Carolina
Supply chain management involves coordinating activities from suppliers to customers. It aims to acquire materials, convert them into finished products, and deliver them to customers. The key is integrating business processes like procurement, production, and distribution. Information and material must flow throughout the supply chain. The overall goal is meeting customer demand efficiently while achieving business objectives like revenue growth, better asset use, and cost reduction. An effective supply chain considers design, planning at strategic, tactical and operational levels, and transaction processing. It requires collaboration across functions to compress time and ensure quality from suppliers to customers.
The document discusses push and pull strategies in supply chain management. It describes push strategies as relying on production decisions based on forecasts, while pull strategies are demand-driven based on customer orders. A push-pull hybrid combines the advantages of both by using forecasts for early supply chain stages and customer demand for later stages. The bullwhip effect and benefits of postponement are also covered. Finally, factors for determining the optimal push-pull boundary based on demand uncertainty and economies of scale are presented.
The document discusses the role of supply chain management (SCM) in hotels. SCM aims to optimize costs in four areas: transaction costs by reducing suppliers and standardizing purchases; product procurement costs by bulk buying and coordination; inventory costs by standardizing products and linking sales and purchasing data; and the genesis of higher costs from customer demands, inconsistent products from many suppliers, and lack of integrated IT systems. SCM seeks to apply lean, agile, resilient and green paradigms to optimize a hotel's supply chain.
Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products. It involves the active streamlining of a business's supply-side activities to maximize customer value and gain a competitive advantage in the marketplace.
The document discusses the basics of supply chain management. It defines the supply chain as including suppliers, manufacturers, warehouses, distribution centers, and retail outlets, as well as the flow of raw materials, work-in-progress inventory, and finished products between these facilities. It also discusses supply chain management as a set of approaches to efficiently integrate these entities to minimize costs and satisfy demand requirements. Key challenges in supply chain management include uncertainty, complexity, and the bullwhip effect where demand variability increases as you move up the supply chain.
041.011 kurt salmon retail white paper Kurt Salmon
This document discusses maximizing inventory efficiency in the retail industry. It identifies three key areas for optimization: assortment rationalization, product flow optimization, and inventory management best practices. Assortment rationalization focuses on understanding product performance to reduce surplus inventory. Product flow optimization examines delivery channels and networks to move products more efficiently. Inventory management best practices assess areas like forecasting, markdowns, and allocation to improve stock levels. The consulting firm Kurt Salmon provides tools and expertise to assist retailers in inventory efficiency initiatives across these three supply chain areas.
Bill Stankeiwcz Copy Scope 2010 Parker CompanyBillStankiewicz
This document discusses strategic sourcing from best cost countries (BCC). It provides an overview of key topics including:
1. The history and strategic drivers of global sourcing, both external factors like globalization and technology, as well as internal drivers like voice of the customer priorities.
2. The supply chain framework and BCC sourcing process, including objectives, evolving strategic sourcing approaches, and the DMAIC strategy for the sourcing process.
3. Tools for BCC sourcing like checklists, matrices for supplier selection and comparison, performance scorecards, and mechanisms for tracking spend profiles, cost reduction projects, and total landed costs.
4. Finally, it discusses managing the risks
The document provides strategies and tactics for implementing a consumption-driven pull distribution system across a retailer's supply chain. Key points include:
1) Establishing a consumption-based replenishment system from shops to regional distribution centers (RDCs) to a central distribution center (CDC) based on daily sales reports. This reduces order lead times and inventories.
2) Setting appropriate inventory targets in shops, RDCs and CDC based on consumption within replenishment lead times from the next link.
3) Educating shop staff and setting initial inventory targets in shops by product. Excess is moved to backrooms and potentially returned to RDCs.
This overhaul of internal logistics is aimed
(1) A supply chain consists of all parties involved in fulfilling customer requests, including suppliers, transporters, warehouses, retailers, and more. It transfers information, products, and finances between stages.
(2) Major stages of a supply chain include sourcing/procurement, materials management, logistics, sales and marketing, quality control, customer service, inventory management, and transportation. Lack of coordination between stages can increase costs.
(3) Differences between push and pull supply chains relate to when customer demand is known. In a pull process, demand is known with certainty, while in push demand must be forecasted.
This whitepaper provides a structured approach for making important distribution center design decisions. Content includes: How to develop a throughput design tool that will help you identify your optimal pick strategy and identify ROI- justified automation technology; why the distribution center design process should start with picking; and a checklist of potential solutions to consider
The document discusses global supply chain management and key factors to consider when developing an international sourcing strategy. It covers Porter's value chain model and how identifying competitive advantages across different links in the value chain can help multinational companies determine the most cost-effective global supply chain configuration. Competencies around positioning, integration, agility, and performance measurement are also important for efficiently managing global supply chains.
The document discusses different supply chain strategies including push, pull, and push-pull strategies. It explains that traditional push strategies involve production decisions based on forecasts which can lead to problems like inability to meet changing demand, obsolescence, and the bullwhip effect. Pull strategies are demand-driven and involve producing to actual customer orders, reducing inventory levels and variability. Push-pull strategies take a hybrid approach, with early stages replenished by forecasts and later stages based on actual orders. The document also discusses factors to consider in selecting the appropriate strategy, such as demand uncertainty and importance of economies of scale.
Supply Chain Network Design is a strategic exercise to evaluate and recommend changes to a company's physical supply chain, including inbound and outbound movement and storage of raw materials and finished goods. It aims to optimize asset utilization, total landed costs, and service levels to improve margins. Key triggers for a network design study include changes in regulations, business environment, growth plans, new products/markets, and mergers. The study analyzes scenarios to determine the most profitable supplier-plant-warehouse-market mapping and answers questions about facilities, capacity, and transportation.
The document discusses supply chain management (SCM). It defines SCM as the management of relationships between suppliers, manufacturers, warehouses, distribution centers, and customers to deliver value to customers at a low cost. The goal of SCM is to optimize efficiency through integrating these entities. The document also describes how SCM has evolved from a "push" model driven by forecasts to a "pull" model driven by actual customer demand.
The document outlines 8 rules for effective supply chain management. The rules are: 1) optimize internal processes before focusing externally, 2) inventory management requires collaboration across the chain, 3) coordination is needed across all players to minimize costs and bottlenecks, 4) time impacts costs and cash flow so reliable lead times are important, 5) customers drive the chain so their needs must be understood and met, 6) smooth continuous flow is preferable to optimize value, 7) take a holistic view to find trade-offs, and 8) information flow lubricates the chain and appropriate technology is critical. Following these rules can improve key metrics like inventory levels, on-time delivery, profits as a percentage of sales.
This document provides an overview of supply chain management concepts from a textbook. It defines a supply chain, discusses the objective of maximizing overall value, and describes the three key decision phases of supply chain strategy, planning and operations. It also presents models for understanding supply chain processes, including the cycle view, push/pull view, and categorization of processes into customer relationship management, internal supply chain management and supplier relationship management. Examples of different company supply chains are provided.
This document discusses how implementing a responsive supply chain can benefit all links in the supply chain. It argues that switching from a forecast-driven "push" model to a consumption-driven "pull" model, supported by buffer management and incentives for on-time delivery of daily consumption orders, can dramatically improve availability while reducing inventory levels. This approach is estimated to increase retailer sales by 10% and profits by over 200% through higher sales, margins on premium-priced goods, and maintained operating expenses despite increased sales volume. The benefits are proposed to extend to all supply chain partners through increased profits, incentives from retailers, and potential cost reductions from handling less inventory.
The document discusses the building blocks of supply chain management. It identifies the key building blocks as customer focus and demand management, resource and capacity management, procurement and supplier focus, inventory management, operations management, and distribution management. It also discusses three integrating processes: systems and procedures, sales and operations planning, and performance management. The document emphasizes that all building blocks must be examined together to have an effective total supply chain management approach.
This document discusses international logistics and supply chain management. It defines supply chains and logistics, and outlines the history and evolution of supply chain management. It describes key supply chain concepts like push and pull strategies, the bullwhip effect, and collaboration. It also examines supply chain drivers, processes, decisions, and emerging best practices. The overall document provides a comprehensive overview of modern supply chain management principles and strategies.
Transformational Steps on the Journey to Demand Driven Supply NetworkIntrigo Systems
Learn how Clorox, a leader in the Consumer Products industry, maintained its well coveted customer service levels of beyond 99.5% throughout a large scale SAP SCM implementation - across 8 business units. [Presented at the 2011 ASUG Community Focus Conference]
This document summarizes the objectives and activities of the "Feed for Health: A Best Practice COST Action" network. The network aims to [1] develop collaboration around research on the role of feed and animal nutrition in animal and human health, and [2] examine consumer perceptions of how feed production impacts food quality, safety, and health. It establishes four working groups focusing on feed and food for health, feed supply, feed safety, and consumer concerns. The groups facilitate research sharing in areas like nutrient supplementation to optimize animal health and food nutrition quality and safety. Over its duration, the network held various events, published over 270 papers and books, and established over 30 additional collaborative projects, demonstrating its success in integrating research on this
Read this customer reference slide to see how Celestica optimizes inventory across their extended supply chain using SAP Enterprise Inventory Optimization by SmartOps, a SAP solution extension
This document discusses inventory optimization steps that can be implemented with SAP, including standardizing materials, seasonal material planning, vendor managed inventory, repair and maintenance budget controlling, purchase order delivery reminders, alerts for stock levels, and purchase requisition return cycles. It provides details on how each step is configured and functions within the SAP system to help optimize inventory levels and management.
Getting the right product to the right customer location at the right time is key to commercial success for any company. But with more than 6,000 product lines across 13 business units and operations in 90 countries, this is a challenging task for DuPont. The company decided to integrate its inventory management using the SAP® Enterprise Inventory Optimization application by SmartOps. As a result, it has reduced costs by cutting excess safety stock while improving customer service.
The document discusses the basics of supply chain management. It defines the supply chain as including suppliers, manufacturers, warehouses, distribution centers, and retail outlets, as well as the flow of raw materials, work-in-progress inventory, and finished products between these facilities. It also discusses supply chain management as a set of approaches to efficiently integrate these entities to minimize costs and satisfy demand requirements. Key challenges in supply chain management include uncertainty, complexity, and the bullwhip effect where demand variability increases as you move up the supply chain.
041.011 kurt salmon retail white paper Kurt Salmon
This document discusses maximizing inventory efficiency in the retail industry. It identifies three key areas for optimization: assortment rationalization, product flow optimization, and inventory management best practices. Assortment rationalization focuses on understanding product performance to reduce surplus inventory. Product flow optimization examines delivery channels and networks to move products more efficiently. Inventory management best practices assess areas like forecasting, markdowns, and allocation to improve stock levels. The consulting firm Kurt Salmon provides tools and expertise to assist retailers in inventory efficiency initiatives across these three supply chain areas.
Bill Stankeiwcz Copy Scope 2010 Parker CompanyBillStankiewicz
This document discusses strategic sourcing from best cost countries (BCC). It provides an overview of key topics including:
1. The history and strategic drivers of global sourcing, both external factors like globalization and technology, as well as internal drivers like voice of the customer priorities.
2. The supply chain framework and BCC sourcing process, including objectives, evolving strategic sourcing approaches, and the DMAIC strategy for the sourcing process.
3. Tools for BCC sourcing like checklists, matrices for supplier selection and comparison, performance scorecards, and mechanisms for tracking spend profiles, cost reduction projects, and total landed costs.
4. Finally, it discusses managing the risks
The document provides strategies and tactics for implementing a consumption-driven pull distribution system across a retailer's supply chain. Key points include:
1) Establishing a consumption-based replenishment system from shops to regional distribution centers (RDCs) to a central distribution center (CDC) based on daily sales reports. This reduces order lead times and inventories.
2) Setting appropriate inventory targets in shops, RDCs and CDC based on consumption within replenishment lead times from the next link.
3) Educating shop staff and setting initial inventory targets in shops by product. Excess is moved to backrooms and potentially returned to RDCs.
This overhaul of internal logistics is aimed
(1) A supply chain consists of all parties involved in fulfilling customer requests, including suppliers, transporters, warehouses, retailers, and more. It transfers information, products, and finances between stages.
(2) Major stages of a supply chain include sourcing/procurement, materials management, logistics, sales and marketing, quality control, customer service, inventory management, and transportation. Lack of coordination between stages can increase costs.
(3) Differences between push and pull supply chains relate to when customer demand is known. In a pull process, demand is known with certainty, while in push demand must be forecasted.
This whitepaper provides a structured approach for making important distribution center design decisions. Content includes: How to develop a throughput design tool that will help you identify your optimal pick strategy and identify ROI- justified automation technology; why the distribution center design process should start with picking; and a checklist of potential solutions to consider
The document discusses global supply chain management and key factors to consider when developing an international sourcing strategy. It covers Porter's value chain model and how identifying competitive advantages across different links in the value chain can help multinational companies determine the most cost-effective global supply chain configuration. Competencies around positioning, integration, agility, and performance measurement are also important for efficiently managing global supply chains.
The document discusses different supply chain strategies including push, pull, and push-pull strategies. It explains that traditional push strategies involve production decisions based on forecasts which can lead to problems like inability to meet changing demand, obsolescence, and the bullwhip effect. Pull strategies are demand-driven and involve producing to actual customer orders, reducing inventory levels and variability. Push-pull strategies take a hybrid approach, with early stages replenished by forecasts and later stages based on actual orders. The document also discusses factors to consider in selecting the appropriate strategy, such as demand uncertainty and importance of economies of scale.
Supply Chain Network Design is a strategic exercise to evaluate and recommend changes to a company's physical supply chain, including inbound and outbound movement and storage of raw materials and finished goods. It aims to optimize asset utilization, total landed costs, and service levels to improve margins. Key triggers for a network design study include changes in regulations, business environment, growth plans, new products/markets, and mergers. The study analyzes scenarios to determine the most profitable supplier-plant-warehouse-market mapping and answers questions about facilities, capacity, and transportation.
The document discusses supply chain management (SCM). It defines SCM as the management of relationships between suppliers, manufacturers, warehouses, distribution centers, and customers to deliver value to customers at a low cost. The goal of SCM is to optimize efficiency through integrating these entities. The document also describes how SCM has evolved from a "push" model driven by forecasts to a "pull" model driven by actual customer demand.
The document outlines 8 rules for effective supply chain management. The rules are: 1) optimize internal processes before focusing externally, 2) inventory management requires collaboration across the chain, 3) coordination is needed across all players to minimize costs and bottlenecks, 4) time impacts costs and cash flow so reliable lead times are important, 5) customers drive the chain so their needs must be understood and met, 6) smooth continuous flow is preferable to optimize value, 7) take a holistic view to find trade-offs, and 8) information flow lubricates the chain and appropriate technology is critical. Following these rules can improve key metrics like inventory levels, on-time delivery, profits as a percentage of sales.
This document provides an overview of supply chain management concepts from a textbook. It defines a supply chain, discusses the objective of maximizing overall value, and describes the three key decision phases of supply chain strategy, planning and operations. It also presents models for understanding supply chain processes, including the cycle view, push/pull view, and categorization of processes into customer relationship management, internal supply chain management and supplier relationship management. Examples of different company supply chains are provided.
This document discusses how implementing a responsive supply chain can benefit all links in the supply chain. It argues that switching from a forecast-driven "push" model to a consumption-driven "pull" model, supported by buffer management and incentives for on-time delivery of daily consumption orders, can dramatically improve availability while reducing inventory levels. This approach is estimated to increase retailer sales by 10% and profits by over 200% through higher sales, margins on premium-priced goods, and maintained operating expenses despite increased sales volume. The benefits are proposed to extend to all supply chain partners through increased profits, incentives from retailers, and potential cost reductions from handling less inventory.
The document discusses the building blocks of supply chain management. It identifies the key building blocks as customer focus and demand management, resource and capacity management, procurement and supplier focus, inventory management, operations management, and distribution management. It also discusses three integrating processes: systems and procedures, sales and operations planning, and performance management. The document emphasizes that all building blocks must be examined together to have an effective total supply chain management approach.
This document discusses international logistics and supply chain management. It defines supply chains and logistics, and outlines the history and evolution of supply chain management. It describes key supply chain concepts like push and pull strategies, the bullwhip effect, and collaboration. It also examines supply chain drivers, processes, decisions, and emerging best practices. The overall document provides a comprehensive overview of modern supply chain management principles and strategies.
Transformational Steps on the Journey to Demand Driven Supply NetworkIntrigo Systems
Learn how Clorox, a leader in the Consumer Products industry, maintained its well coveted customer service levels of beyond 99.5% throughout a large scale SAP SCM implementation - across 8 business units. [Presented at the 2011 ASUG Community Focus Conference]
This document summarizes the objectives and activities of the "Feed for Health: A Best Practice COST Action" network. The network aims to [1] develop collaboration around research on the role of feed and animal nutrition in animal and human health, and [2] examine consumer perceptions of how feed production impacts food quality, safety, and health. It establishes four working groups focusing on feed and food for health, feed supply, feed safety, and consumer concerns. The groups facilitate research sharing in areas like nutrient supplementation to optimize animal health and food nutrition quality and safety. Over its duration, the network held various events, published over 270 papers and books, and established over 30 additional collaborative projects, demonstrating its success in integrating research on this
Read this customer reference slide to see how Celestica optimizes inventory across their extended supply chain using SAP Enterprise Inventory Optimization by SmartOps, a SAP solution extension
This document discusses inventory optimization steps that can be implemented with SAP, including standardizing materials, seasonal material planning, vendor managed inventory, repair and maintenance budget controlling, purchase order delivery reminders, alerts for stock levels, and purchase requisition return cycles. It provides details on how each step is configured and functions within the SAP system to help optimize inventory levels and management.
Getting the right product to the right customer location at the right time is key to commercial success for any company. But with more than 6,000 product lines across 13 business units and operations in 90 countries, this is a challenging task for DuPont. The company decided to integrate its inventory management using the SAP® Enterprise Inventory Optimization application by SmartOps. As a result, it has reduced costs by cutting excess safety stock while improving customer service.
This document provides an overview of SAP's solutions for digital transformation, including solutions to manage customers, employees, suppliers, assets, and the digital core. It highlights case studies of companies that achieved reductions in order processing time, invoice processing time, defects, and increases in productivity and account closing speed. It promotes SAP Solution Extensions for digitally transforming companies and generating $2 billion in profits annually for customers.
The document discusses inventory optimization and continuous improvement initiatives to minimize supply chain costs while maintaining customer service levels. It defines inventory optimization and outlines how to calculate accurate carrying costs. It also describes classifying inventory based on variability, gross margin, or usage to target reductions. An example case study shows how a specialty chemicals company cut inventory in half through analysis and process changes, reducing expenses while maintaining high customer service. Key performance indicators and typical benefits like reduced costs and increased asset utilization are also summarized.
This document summarizes an inventory optimization solution called Goods4Cast. It began in 2000 and has since grown, winning awards and becoming a resident of the Skolkovo innovation center. It uses forecasting algorithms to recommend optimal inventory levels and orders. The solution targets retailers and wholesalers and solves problems like overstock, out-of-stock, and excessive labor. It has a cloud-based SaaS model for SMBs and on-premise implementations for large enterprises. The team has experience implementing solutions for major Russian companies and see
1) Inventory optimization aims to maximize availability while minimizing costs through better demand forecasting and planning.
2) Accurate demand forecasting is key, and requires selecting the best forecasting models and optimizing parameters for each item.
3) State-of-the-art approaches use automatic, adaptive techniques to update models and parameters over time as new demand data becomes available.
Dokumen tersebut membahas tentang tugas pembuatan makalah studi Al-Qur'an, yang mencakup latar belakang, pengertian, dan sejarah pembukuan Al-Qur'an pada masa Nabi Muhammad, Abu Bakar, dan Utsman bin Affan. Tulisan itu juga membahas ilmu-ilmu Al-Qur'an seperti objek, metode dan tujuan dari Ulumul Qur'an.
Inventory Optimization - A New Approach to Operational Inventory PlanningSAP Solution Extensions
In today’s ultracompetitive business environment, companies can ill afford supply chain inefficiencies. But if planners are using outdated inventory management models, it can be challenging to run a tight ship.
To boost efficiency, run leaner, and drive down supply costs, many organizations are exploring inventory optimization. This technique improves inventory targets to address the realities of today’s complex, ever-evolving global supply chains.
This paper examines how the stochastic multistage, multi-inventory model supports inventory optimization. It also looks at how the SAP® Enterprise Inventory Optimization application by SmartOps uses the model to help supply planners execute more effectively. The software enables a collaborative approach that extends beyond organizational boundaries while helping planners predict demand patterns more accurately. And an option that provides analytics for the application delivers executive-level insights and reporting using a focused dashboard.
This document discusses the development of an intelligent inventory management system that can help bridge the gap between inventory management theory and practice. It summarizes existing inventory expert systems and identifies limitations, such as a lack of properly structured knowledge bases and the inability to automatically select suitable inventory models based on historical demand data. The proposed new system aims to address these limitations by providing automatic demand pattern identification, model selection facilities, and the ability to switch models if demand patterns change over time.
The document discusses using inventory modeling to develop a holistic inventory strategy. It describes how companies aim to improve service levels while reducing inventory levels, but it is difficult to do both simultaneously without modeling. The document outlines factors like demand variability, supply chain complexity, different types of inventory levels, and demand patterns that must be considered in developing an effective inventory strategy. It provides an example of how modeling helped a manufacturer optimize inventory levels at dealers and distribution centers.
This document describes a dissertation that investigates dynamic optimization of warehouse operations using predictive analytics. Specifically, it examines the forward-reserve problem (FRP), where items must be assigned to a high-speed "forward" picking area or lower-speed "reserve" area. The dissertation defines the static FRP problem and develops heuristics to solve it. It also formally defines the dynamic FRP, where assignments can change over time in response to demand changes. A mathematical model and heuristics are developed for the dynamic problem. Extensive testing shows the dynamic approach outperforms static approaches, especially for volatile demand patterns, by continuously adapting to optimize operations.
The document provides a historical perspective on supply chain management (SCM) in Thailand. It discusses how SCM has evolved from the traditional independent business model to today's more collaborative model enabled by advances in information technology. It also summarizes recent developments in SCM adoption in Thailand, including initiatives in the retail, apparel, and other industries. Key enablers of SCM like ERP systems are also discussed. Overall the document outlines Thailand's progress with SCM but notes most companies still have a long way to go to fully realize its benefits.
This document provides a synopsis of a research project on inventory costs in the housekeeping department of major hotels in Ranchi, India. The significance of the study is outlined as determining the appropriate inventory level to reduce shortages and maximize linen life. A literature review covers inventory cost components, optimal inventory strategies, and periodic review models. The objectives are to suggest ways to select quality suppliers and linens while controlling costs. The hypothesis is that proper purchasing procedures may affect housekeeping inventory costs. Primary data will be collected through questionnaires and interviews with hotel managers, while secondary data comes from books, websites, journals, and more. Descriptive analysis will be used to analyze the data.
Have you ever asked the question -- Why Healthcare Facilities cannot be profitable? Maybe it is in the way they are designed. It is time for a change. We can make the difference.
Oplægget blev holdt ved InfinIT-arrangementet "Temadag om værdikæder i netværk og plug'n play supply chains" afholdt den 1. november 2011.
Læs mere på http://infinit.dk/dk/hvad_kan_vi_goere_for_dig/viden/reportager/grib_chancen_nu.htm
A global economy and increase in customer expectations in terms of cost and services
have put a premium on eective supply chain reengineering. It is essential to perform
risk benet analysis of reengineering alternatives before making a nal decision. Sim-
ulation provides an eective pragmatic approach to detailed analysis and evaluation of
supply chain design and management alternatives. However, the utility of this method-
ology is hampered by the time and eort required to develop models with sucient
delity to the actual supply chain of interest. In this paper, we describe a supply-chain
modeling framework designed to overcome this diculty. Using our approach, supply
chain models are composed from software components that represent types of supply
chain agents (like retailers, manufacturers, transporters), their constituent control ele-
ments (like inventory policy), and their interaction protocols (like message types). The
underlying library of supply chain modeling components has been derived from anal-
ysis of several dierent supply chains. It provides a reusable base of domain-specic
primitives that enables rapid development of customized decision support tools.
An incremental mining algorithm for maintaining sequential patterns using pre...Editor IJMTER
Mining useful information and helpful knowledge from large databases has evolved into
an important research area in recent years. Among the classes of knowledge derived, finding
sequential patterns in temporal transaction databases is very important since it can help model
customer behavior. In the past, researchers usually assumed databases were static to simplify datamining problems. In real-world applications, new transactions may be added into databases
frequently. Designing an efficient and effective mining algorithm that can maintain sequential
patterns as a database grows is thus important. In this paper, we propose a novel incremental mining
algorithm for maintaining sequential patterns based on the concept of pre-large sequences to reduce
the need for rescanning original databases.
This document outlines a warehouse automation analytics project that uses advanced data analytics to optimize warehouse operations. The project aims to address existing challenges around inefficiencies, suboptimal resource usage, unpredictable inventory levels, and downtime. Through analyzing historical and real-time data, the project enhances resource allocation, identifies bottlenecks, improves inventory management with predictive models, and provides stakeholders with operational insights via dashboards. The goals are to streamline processes, reduce downtime, minimize stockouts, and improve overall warehouse performance and competitiveness.
While sustainability is an important consideration, the given document does not mention it. The challenges discussed are cost containment, visibility, risk management, increasing customer demands, and globalization.
#Resilience is retailers' word of the year for 2021. In the face of enormous uncertainty, developing retail resilience now and in the future is how brands must respond to the harsh realities brought on by the pandemic to adapt and thrive.
Here are 3 Levers of Retail Resilience.
Get our 2021 Future of Retail for free by subscribing to PSFK's Weekly Debrief: https://lnkd.in/dzwQqB4
#retailstrategy #retailproblems #retailresilience
An emerging step : Data Warehousing to Pattern WarehousingHarshita S. Jain
This presentation shows the sequential step from the advent of Data mining, Data Warehousing to Pattern Warehousing which includes the present gaps and gives idea for future work & research in order to make the work more easy.
This document discusses challenges with inventory management and emerging solutions using big data analytics. Effective inventory control balances meeting customer needs while keeping inventory levels as low as possible. However, inventory management is complicated by conflicting objectives within companies and unpredictable supply and demand. New inventory optimization tools use big data from ERP systems to more accurately analyze trends, forecast demand, and recommend optimal inventory levels and replenishment schedules to reduce costs while maintaining customer satisfaction. These tools help companies better balance the trade-offs between avoiding stock-outs and overstocking.
This document is a thesis presented by Nabil Belghasmi to obtain a Doctorate in Computer Science from the National School of Computer Science in Manouba, Tunisia. The thesis focuses on two main areas: inventory management and evolutionary multiobjective optimization. In inventory management, the thesis develops several multi-objective models of the transshipment problem, including an extension of the classic newsvendor model with multiple objectives. In optimization, the thesis proposes new evolutionary algorithms for solving continuous, stochastic multi-objective problems, including algorithms that hybridize genetic algorithms with local search methods. It also introduces a new concept of multiobjective confidence hyperrectangles to help manage uncertainty in stochastic multi-objective optimization problems.
This document provides an overview of inventory management systems. It defines key inventory management terms and concepts. The document describes the objectives and functional areas of inventory management. It outlines the integrated process of inventory management including data requirements, models, and relationships with other business functions and systems. Specific tools, roles, and responsibilities are also discussed.
This document discusses the need for companies to adopt a "sense and respond" capability in their supply chains to deal with increased volatility and uncertainty. It argues that the traditional model of separate planning and execution is no longer sufficient. Instead, companies need integrated supply chains that can sense changes in demand or disruptions and rapidly re-plan and adjust fulfillment in real-time. The document provides examples of how sense and respond capabilities could help companies minimize the impact of supplier disruptions or better match replenishments to unexpected changes in store-level demand. It also outlines the key elements needed for sense and respond which include visibility, flexibility, advanced analytics, collaboration, and adaptive technologies.
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2. The stochastic multistage, multi-inventory model recognizes a simple fact: inventory
targets at one location affect, and are affected by, targets at different locations. To
minimize the need for excess safety stock, this model uses an efficient computational
process where multiple mathematical equations are solved simultaneously to reveal
optimal inventory targets.
3. EXECUTIVE SUMMARY
ON THE ROAD TO OPTIMIZATION
For years, supply chain planners have used outdated
inventory management models, resulting in supply chain
inefficiencies that their companies can ill afford in today’s
ultracompetitive environment.
To boost efficiency, run leaner, and This paper examines how the stochas- Inventory optimization
drive down the cost of supply, many tic multistage, multi-inventory model
organizations are exploring inventory supports inventory optimization. It also
augments existing ERP
optimization – a technique for improving looks at how the SAP® Enterprise and advanced planning and
operational inventory targets to Inventory Optimization application by
address the realities of today’s highly SmartOps uses the model to help sup-
scheduling systems, helping
complex, ever-evolving global supply ply planners execute more effectively in planners improve operational
chains. a highly collaborative enterprise envi-
ronment that extends beyond organiza-
inventory targets.
tional boundaries.
Overview
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4. INVENTORY MANAGEMENT HAS CHANGED
HAS YOUR APPROACH CHANGED WITH IT?
Traditional approaches
to inventory planning –
based largely on rules
of thumb rather than
formal data analysis –
lead to out-of-stock
situations and supply
inefficiencies.
Traditional approaches to inventory (APS) systems, helping planners staggering number of variables, con-
planning are based largely on rules improve operational inventory targets straints, and what-if scenarios, this
of thumb. Planners develop a set of with item-location-period granularity for model empowers planners to manage
heuristics for determining safety stock finished goods, intermediates, or raw the complexity of today’s supply
levels, and these rules get handed down materials and components. The result chains. This differs from traditional
from one generation to the next. Some is better visibility into demand, enabling inventory management models that
organizations also use rudimentary planners to modify inventory to reduce depend on deterministic, discrete-time
analysis, where items are weighted on carrying costs without negatively im- inventory theory in the following ways.
an A-B-C scale with the top priority pacting customer service levels and
of keeping A-level items in stock. The sacrificing product availability. This Molecular, Not Atomic
assumptions made for this sort of analy- empowers organizations to improve Traditional inventory management views
sis, however, are typically revisited only performance and more effectively meet the supply chain according to a single-
rarely. In fast-changing environments, the terms of service-level agreements. stage, single-item model that can be
this approach leads to out-of-stock situ- characterized as atomistic. This model
ations and supply chain inefficiencies. The Science sees each stock item and each stage
or stock location (such as a distribution
The complexities and uncertainties rep- The science behind inventory optimiza- center) as isolated entities with few if
resented by today’s constantly evolving tion involves stochastic (probabilistic) any meaningful dependencies.
global supply chains demand a dynamic multistage, multi-inventory modeling
new approach, and that’s called inven- where a sophisticated algorithm is used The multistage model, in contrast, views
tory optimization. The inventory optimi- to assess vast amounts of historic and the supply chain in terms of molecules –
zation approach augments existing real-time information while accounting which are made up of atoms. This re-
enterprise resource planning (ERP) and for multiple variabilities and interdepen- flects the reality of today’s multistage
advanced planning and scheduling dencies. By enabling the analysis of a supply chains that include suppliers,
4 SAP Thought Leadership – Inventory Optimization
5. numerous manufacturing stages, sub- Variable, Not Unvarying planning functionality for understanding
contractors, vendor-managed inventory, Traditional models lack the mechanisms inventory liabilities, maintaining service
central warehouses, and multiple distri- to dynamically capture changing values levels, and operating according to sup-
bution centers. This model recognizes or correct for time-varying errors. The plier and vendor-managed inventory
a simple fact: inventory targets at one multistage model, by contrast, is flexi- business models.
location affect, and are affected by, ble enough to continuously incorporate
targets at other locations. To minimize the results of ongoing data analysis. Flexibility
the need for excess safety stock, this This analysis helps identify forecast An inventory optimization application
model uses an efficient computational errors and biases so that planners can needs to be flexible enough to accom-
process where multiple mathematical correct values and modify assumptions modate different industries – such as
equations are solved simultaneously to over time, thus supporting continuous consumer products, chemicals, manu-
reveal optimal inventory targets. improvement and closing the loop on facturing, wholesale distribution, and
inventory management. high tech. A useful feature in this
Dynamic, Not Static respect would be reporting tools that
To accommodate the reality of con- The Business Requirements can help validate, analyze, and improve
stantly changing demand, inventory industry-specific supply chain informa-
planners often cobble together sets of The purpose of the multistage model is tion regarding demand, supply, and pro-
unconnected static models to ensure to help planners in real-world supply duction elements.
proper levels of safety stock. In con- planning scenarios. Any application that
trast, the multistage model is designed seeks to leverage the multistage model Data Input Connectivity
to be nonstationary or time varying to must meet the following requirements. Better outputs require better inputs.
accommodate shifting demand. Excess Thus, an inventory optimization applica-
inventory from previous periods can be tion should include data connectivity
used to satisfy demand in future lower-
No planner knows every- modules that can work with a wide
demand periods, making the model thing, and the models that range of data sources to transform and
intertemporally consistent. The non- load raw data easily and automatically.
stationary character of the model also planners work with should These modules should also accommo-
allows organizations to model season- reflect this reality. date the supply chain network structure
ality, promotions, and end-of-quarter itself, which is often the most challeng-
spikes. It also accommodates the fact ing aspect of data connectivity.
that uncertainty is greater when looking Enterprise Readiness
farther ahead in time – something tradi- Many inventory optimization applica- Built-In Intelligence
tional approaches cannot do. tions – designed as desktop tools for The ability to access data is important.
offline analysis – fail to address the fact But planners also need to work with
Data-Driven, Not Assumption-Based that supply planning is a collaborative that data. An inventory optimization
The multistage model recognizes that activity that extends beyond enterprise application, then, must support robust
organizations work only with finite his- boundaries. They are neither scalable analysis to help planners understand
torical data. Traditional models, on the nor capable of automating planning pro- issues involving forecast bias and accu-
other hand, start with an idealized cesses. What’s needed is an applica- racy, supplier uncertainty, schedule
assumption that planners possess tion that leverages the multistage model adherence, and more.
complete knowledge of demand distri- at an enterprise level. Requirements
bution. No planner knows everything, include visibility across multiple ERP
and the models that planners use applications and planning systems,
should reflect this reality. along with support for global inventory-
SAP Thought Leadership – Inventory Optimization 5
6. Approval Workflow or the SAP Advanced Planning & Opti- In the end, these capabilities enable
Planners need to review updated inputs mization component. In either case, it your planners to optimize inventory
(such as forecasts), perform due dili- enables planners to dynamically deter- levels throughout the organization,
gence, and formally approve any modi- mine optimal demand-driven, time- helping you improve customer service
fied targets in order to avoid problems phased inventory targets for every item levels while minimizing working capital
downstream. An inventory optimization at every location throughout your supply requirements. This makes you more
application should accommodate this chain. Specifically, planners can: efficient and far more competitive.
Find Out More
To learn more find out more about
Many inventory optimization applications – designed inventory optimization and how SAP
as desktop tools for offline analysis – fail to address Enterprise Inventory Optimization can
help your organization compete more
the reality that supply planning is a collaborative effectively, contact your SAP represen-
activity that extends beyond enterprise boundaries. tative today or visit us online at
www.sap.com/solutions
/solutionextensions.
requirement with automated workflow • Coordinate capacity, inventory,
and alerts that allow planners to man- demand, lead time, and product avail-
age by exception. ability variables to gauge how much
inventory should be carried by item,
Continuous Improvement location, and time period
Supply chains are in constant flux. This • Leverage a multistage modeling
is why inventory optimization applica- approach to calculate the relationships
tions need to support continuous im- among inventories, service levels,
provement processes. Planners should capacity, and costs across all stocking
have the ability to play out what-if sce- locations and stages – and across
narios and study the ramifications of different types of supply chains within
proposed actions. organizations and beyond enterprise
boundaries to support supplier- and
The Application vendor-managed inventory
• Set and manage targets such as
The SAP Enterprise Inventory Optimi- safety stocks more frequently at
zation application addresses these a more granular level, supporting
requirements, helping organizations lean processes
strike the right balance between service • Accurately track and streamline inven-
levels and inventory investment. The tory positions throughout the order-to-
application can be used on a stand- cash value chain, using advanced
alone basis, if desired, or as an inte- algorithms that eliminate waste and
grated part of the SAP ERP application help the organization run lean
6 SAP Thought Leadership – Inventory Optimization