New Approach to Supply Chain Planning Includes End-to-End Probabilistic Modeling

Jan. 22, 2009
The new solution, permits the probabilistic (or stochastic) nature of the supply chain to be integrally modeled in all of the SCP functions.

ToolsGroup, a provider of demand-driven inventory optimization solutions, recently announced a new type of supply chain planning (SCP) solution, which incorporates probabilistic modeling across all main supply chain planning functions.

The SO99+ SCP solution, permits the probabilistic (or stochastic) nature of the supply chain to be integrally modeled in all of the SCP functions, including demand forecasting and planning, inventory management and optimization, and replenishment and transportation planning.

The company points out that most supply chain planning suites have used deterministic APS (advanced planning and scheduling) logic but with recent supply chains demands including are shorter product life cycles, product promotions, longer supply lines, and the current economic uncertainty, a disconnect is created between these deterministic models and real life supply chain behavior. Rather than constantly adjusting and tweaking to accommodate the randomness of the supply chain, this new system directly addresses the stochastic supply chain behavior.

The solution also addressed the problem of intermittent or "lumpy demand." Demand buckets are getting smaller as product proliferation creates more alternatives and shorter replenishment cycles create more time slices. A recent ToolsGroup analysis of eight branded companies found that typically more than 70% of their SKUs were in the lumpy demand category.

Interested in information related to this topic? Subscribe to our Information Technology eNewsletter.

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Shifting Your Business from Products to Service-Based Business Models: Generating Predictable Revenues

Oct. 27, 2023
Executive summary on a recent IndustryWeek-hosted webinar sponsored by SAP

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!