The Modern Supply Chain: Inventory Optimization Competitive Assessment

The Modern Supply Chain: Inventory Optimization Competitive Assessment Supply Chain Strategies European Supply Chain Strategies -insights.com COMPETITIVE ANALYSIS #MI218001 www.manufacturing Simon Ellis Kimberly Knickle Pierfrancesco Manenti MANUFACTURING INSIGHTS OPINION The continued global recession impacting multiple value chains has placed enormous pressures on supply chain organizations. Business F.508.988.7881 objectives have temporarily narrowed toward maintaining profitable customers and preserving cash and working capital. Dramatic changes in business have inevitable impact to a company's supply chain network, and the overall management of supply chain inventories P.508.988.7900 across all tiers of the global supply chain has taken on ever more importance because of its direct relationship toward minimizing cash and improving the bottom line. Findings include: ● Inventory optimization (IO) technology has increasingly become an important tool to aid manufacturers in either managing their Global Headquarters: 5 Speen Street Framingham, MA 01701 USA overall supply chain inventories more efficiently or having the capability to support decision-making processes with what-if quantification of the impact of certain business decisions on overall inventory investment. ● This technology has moved beyond its previous "black box" perceptions, and it has increasingly been adopted and deployed by leading-edge companies. Decision processes such as overall sales, inventory, and operations planning (SI&OP); "profitable proximity" sourcing; and new product innovation can all be aided by this technology. ● Manufacturing Insights survey of existing deployments among manufacturers indicates that depending on the existing inventory problem, ROI for this type of technology can be significant and meaningful. Usability across vendor offerings is improving, helping in more rapid adoption. Deeper functionality, broader integration with supply chain network design, demand aware, supply management, and planning workbenches have all helped in adoption and user acceptance levels. ● Deployment of this technology can be accomplished in four to six months for initial managed scope deployments, thus facilitating inventory and other benefits to the business in less than a year. May 2009, Manufacturing Insights #MI218001 Manufacturing Insights: Supply Chain Strategies: Competitive Analysis TABLE OF CONTENTS P In This Report 1 S i t u a t i o n O ve r vi ew 1 Introduction............................................................................................................................................... 1 Inventory Optimization Applications.......................................................................................................... 3 The Business Problem!............................................................................................................................. 4 Application Operation: It's the Data, Stupid! ............................................................................................. 5 The Importance of ROI in an Economic Recession .................................................................................. 6 Value Chain Applicability and Support...................................................................................................... 7 Application Assessment............................................................................................................................ 9 Vendor Landscape ............................................................................................................................ 9 Evaluation Criteria and Assessment ......................................................................................................... 12 Axxom Software AG .......................................................................................................................... 16 IBM/ILOG/LogicTools ........................................................................................................................ 16 i2 Technologies ................................................................................................................................. 17 Optiant ............................................................................................................................................... 19 Oracle................................................................................................................................................ 20 SmartOps .......................................................................................................................................... 21 ToolsGroup........................................................................................................................................ 22 A Few Words on SAP Integration ............................................................................................................. 23 Future Outlook 24 Essential Guidance 25 Learn More 27 Related Research ..................................................................................................................................... 27 #MI218001 ©2009 Manufacturing Insights, an IDC Company LIST OF TABLES P 1 Inventory Optimization Vendor Profiles ........................................................................................ 10 2 Inventory Optimization Vendor Comparison Chart ....................................................................... 12 3 Global Inventory Optimization Application Spending, 2009–2013................................................ 24 ©2009 Manufacturing Insights, an IDC Company #MI218001 LIST OF FIGURES P 1 The Modern Supply Chain............................................................................................................