Redeployment

October 17, 2011

Background Redeployment is the redistribution of stock that is already in a forward location in the supply network to another forward location, or back up to the parent location. Deployment follows a rigid flow of parent to children locations which is essentially designed to minimize logistics costs. However, redeployment is quite different because it means [...]

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Using MEIO to Connect Sales and Supply Chain Planning

October 4, 2011

Background Part of this article is a movement of previous text from a separate article. http://www.scmfocus.com/inventoryoptimizationmultiechelon/2009/11/where-service-level-is-set-for-inventory-optimization/ However, I reviewed an older article are realized this section should be moved and given its own article. Working with Contract Development or Sales Contract development will most often have service levels that are set at the customer. Supply [...]

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MEIO Versus Allocation Software

October 1, 2011

Background The topic of how different supply planning methods relate to one another is always of interest to decision makers, and to my knowledge how allocation and inventory optimization and multi echelon (MEIO) related to another is not generally written upon. What is Allocation Software? Prioritization in Capable to Match (CTM) works on the principle [...]

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MEIO for Consumer Packaged Goods and High Tech

July 10, 2011

How Inventory Optimization and Multi Echelon Planning Applies to CPG and High Tech A frequent question within companies is how inventory optimization and multi-echelon planning (MEIO) relate to their particular industry. At a high level and regardless of industry, MEIO applications are appropriate for any company that wants to manage their supply chain on the [...]

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Key Success Factors for Optimization Projects

June 21, 2011

Key Success Factors I was recently asked what I thought they key success factors were for optimization projects. This seems like somewhat of an obvious topic to write on, but the nice thing about my work is I get a lot of questions that then cause me to think through various topics, and then promote [...]

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How Costs Are Really Set in Cost Optimization Implementations

May 31, 2011

Background In working on a number of cost optimization accounts over the years and in conferring with other individuals who have worked in the area for some time, I have come to a conclusion regarding how costs are set in both supply planning and production planning implementations. The graphic above describes major elements of cost optimization [...]

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Socializing Supply Chain Optimization

May 13, 2011

Background Inventory optimization is really the second major type of optimization to be implemented for supply planning. I work in inventory optimization; however, I also do a fair amount of work in SAP SNP’s optimizer, which is a cost optimizer. That is it attempts to minimize costs while meeting demand and respecting capacity constraints. Something [...]

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SAP is About to Change Its Inventory Optimization Story

April 6, 2011

Background I was recently doing research on SAP’s APO Add-In related to inventory optimization. I was surprised to read what appeared to be the beginnings of an inventory optimization product in one of the add-ins. (I discuss the add-in in detail in this post.) http://www.scmfocus.com/sapplanning/2011/03/21/understanding-apo-add-ins/ SAP’s Old Story on Inventory Optimization I sat in a [...]

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Why Safety Stock Is Not The Focus of Inventory Optimization

March 27, 2011

Background I have always found the many supply chain professionals and executives have been far too focused on safety stock. Safety stock is just that, the stock that is carried to deal with unforeseen events. However, it could just as easily be called variability stock, or the stock that is held in order to account [...]

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Service Level Setting vs. Penalty Costs in a Cost Optimizer

March 27, 2011

Background I am sometimes work with companies that have implemented cost optimization software. However, when you discuss the most important factor to executives, they tell you it is service level. This is interesting, because cost optimization is for companies who’s most important goal is minimizing the costs of the supply plan. Something else which surprises [...]

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