 Process Industries
Software to optimize inventory placement for the Chemical Industry and Process |
|
SmartOps has been named a partner in the SAP Industry Value Network for Chemicals.
This network joins SmartOps with SAP and executives from leading chemicals companies to develop solutions that address the unique business requirements of the chemicals industry. |
SmartOps provides practical and powerful solutions that allow process-oriented manufacturers to optimize global inventory placement over time to achieve desired, reliable service levels at the lowest risk and cost to the business.
Manufacturers of chemicals, metals, plastics, and forestry/paper products must develop inventory production and stocking plans that meet global customer demand while recognizing capacity limitations at the manufacturing plants. Because adding more capacity is a strategic decision and not a tactical planning option, excess inventory is often held as a buffer against any supply chain uncertainties. Unfortunately, that decision creates unnecessary costs to the company and does not ensure demand is met at the right time for each product.
What has been missing from existing planning software solutions and from internal approaches is a comprehensive, analytical view of the global supply chain to continuously determine optimal inventory placement.
Because SmartOps lets companies calculate and understand how much inventory they should carry, why, where and when, process manufacturers can address common challenges that have inhibited improvements in supply chain performance and operating income:
Process Manufacturers Have Large, Often Global Supply Chains
Having different product supply chains -- each having some mix of raw materials, production, packaging, and distribution stages -- makes it difficult to optimize "total chain" inventory on a continuous basis. SmartOps uses a multistage modeling approach that considers and calculates the relationships among inventories, service levels, capacities, and costs across all stocking locations and stages/echelons. SmartOps solutions are designed to handle complex, real-world supply chains.
Capacity Constraints MUST Be Considered in Inventory Plans
Capacity in these manufacturers is expensive, which means excess inventory has often been the buffer against supply chain uncertainties and periods of high demand. Because SmartOps looks at all the purposes inventory is needed in the supply chain -- safety stock, cycle stock, pre-build stock, and in-transit inventories -- companies can more accurately determine optimal inventory targets, given capacity limitations at any planning period. When to start building up inventory, and by how much, when, and why are planning decisions SmartOps supports with great accuracy.
Inherent Uncertainties in Demand Further Complicate Planning
Uncertainties and variances in demand over time -- as well as unexpected supply chain disruptions -- make it that much harder for planners and executives to decide with confidence how much inventory they should carry at any point in their supply chain. To consider such complexities, the solution approach must be able to account for all the drivers of inventory to adequately manage safety stock levels and other purposes for carrying inventory. SmartOps optimization algorithms manage uncertainties in the data and offer visibility into what causes inventory to be held at the item-location-time period level of detail.
SmartOps Multistage Inventory Planning & Optimization (MIPOTM) is an advanced software solution for optimizing total supply chain inventory targets to meet desired customer service/product availability targets, while accounting for capacity constraints, multistage interdependencies, and supply and demand variability.
MIPO fills a persistent gap in the supply chain planning landscape by generating improved inventory targets:
- Across all products and SKUs
- For all locations in the global supply chain
- For each planning period
- For the reasons you might need to carry inventory (safety stock, cycle stock, in- transit/pipeline stock, merchandising/dealer stock)
- Providing better inputs into existing systems and processes.
