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    The opportunity is enormous: to reduce inventory assets and distribution costs across a multi-stage supply chain, while providing a more reliable source of supply to downstream partners and customers.

But the challenges are also great: the sheer number of policy variables to set; the requirement of remaking these regularly in the face of constant change; the stochastic nature of supply and demand; and, the unreliability of simple rules of thumb, and even typical spreadsheet models to guide optimal policies. As with golf, the superficial simplicity of inventory control is entirely deceiving.

Enter technology. Advances in scientific research and computing power have combined for the first time during the past several years to facilitate truly massive improvements in supply-chain performance in multi-stage distribution systems. The bottom line includes major improvements in customer service, simultaneous decreases in total supply chain costs, and great strides in asset utilization.

Inventory optimization is ultimately about how much, and under what conditions, product should flow to one location from another. In an established build-to-stock operation, almost everything depends on these critical decisions. The average level of assets, the number of orders (hence warehouse activity levels), the frequency of shortages, the number of open backorders-all are direct and immediate consequences.

Trade-offs are inescapable. For example, long term, and all else being equal, larger order quantities require less warehouse activity, and result in fewer shortages, while consuming more working capital and running greater risks of obsolescence. In a multi-echelon operation, inventory at a central warehouse is also a partial substitute for inventory at downstream distribution points (and vice-versa); this is an extremely important, and also technically difficult axis of optimization.

Assiduo dramatically improves companies' power to resolve all of these trade-offs to best advantage. While traditional applications have presupposed crude user-determination of optimal fill-rates-a near fatal weakness for companies in a multi-echelon environment concerned with total supply chain cost -our software takes no such short-cuts. Armed with sophisticated cost models tailored to the environment, the Assiduo system recommends optimal target fill-rates, and the associated inventory parameters for every SKU-location pair.

Assiduo also empowers managers to set global inventory strategy as never before. We believe passionately that single point solutions are inadequate, and that managers require meaningful choices and control that go well beyond setting broad-brush service-level targets or getting stuck in the weeds of individual items. Our system contain highly innovative features backed up by cutting edge algorithms that permit you to shape the performance of your demand chain based on the unique features of your environment.
 
 

 
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Briggs & Stratton Success   Story
 
 Contact Us 
 21 Tichester Road,
Suite 1202
Toronto, Ontario, M5P 1P3
Canada
Tel (647) 439-4300
info@assiduo.com
 
 White Paper 
 
 The Unified Supply
  Chain: Key Implications
  and Choices
 
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