News

Most companies are still trying to use Excel to optimize their inventories. Supply Chain Insights’ 2018 Inventory Optimization Technologies Study suggests the number may be as high as 75%. These companies struggle to meet service level requirements while respecting financial impacts, and have almost no chance to do it optimally.…
Source: Gartner Research Gartner Research analyst Paul Lord has developed a thought-provoking approach (shown in the above diagram) for tailoring supply and inventory tactics to different inventory segments. Traditional ABC inventory models segment inventory into A, B and C categories based on annual consumption value. Valuable items with lots of…
When most people think of supply chain risk, they often think about the impact of major unforeseen “headline grabbing” events - like the tsunami in Japan impacting automotive supply chains or horse meat making its way into British beef supplies. These are big, important and often unpredictable risks. But there…
The growing momentum around systems-based thinking in supply chain planning has given rise to a new concept called the “digital twin”. There has been a lot of discussion around this topic lately and I wanted to offer a few insights, including around the importance of the data model in high-quality…
In the food and beverage (F&B) sector, the warehouse is an important component in efficient supply chains, and gaining control of inventory is a core issue facing many manufacturers. The top three challenges that the F&B sector faces regularly are food safety, product traceability and shorter response times, with food…
Cyber-criminals are turning their attention to the supply chain as a new means to exploit business data 17 May 2018 – 2017 saw a worrying increase in ransomware and other cyberattacks targeting the supply chain, with the business and professional services sector receiving a significant increase of attacks, particularly in…
Gartner, Inc.’s annual Supply Chain Executive Conferenceheld last week in Phoenix, AZ provided the platform for the release of its Supply Chain Top 25, which identifies industry “best practices.” Unilever scored the top spot for the third year in a row, followed by Inditex, Cisco, Colgate-Palmolive and Intel. Home Depot…
As part of its fight to keep brick-and-mortar shopping relevant and convenient, Target is testing a new approach to supply chain management, one that would replenish inventory much faster than is currently possible. It would also allow stores to reduce the amount of space they need for storage of merchandise…
Here is the scenario. The C Suite says it wants “digital transformation". Your company has an older supply chain planning (SCP) system of record (SOR) like SAP APO that was developed in the 1990s. You may have added some best-of-breed add-ons for specialized applications such as multi-echelon inventory optimization (MEIO).…
Using the Gartner Demand Planning five stage maturity scale, analyst Mike Griswold estimated on a recent call that retailers as a group averaged just 2.3 out of 5.0, leaving money on the table due to poor inventory performance. In a competitive vertical with thin margins, leaving any money on the…
For firms with Advanced Analytics or Artificial Intelligence (AI) in their future, Gartner has just published a useful report with three findings that clarify the difference between the two technologies and offers insight on employing them for augmenting versus automating supply chain decision making. Advanced Analytics is broader than Artificial…
Brad Householder, Founder and CEO of b2i, spoke at the ToolsGroup TG18 user conference recently and presented an innovative approach to strategically analyze your value chain to focus digital investments. Brad, by the way, comes from a great pedigree. Prior to founding b2i, he was a leader in PwC Advisory's…
Jörg Schlager describing SKF's Integrated Planning (Source: Optilon) “Digital transformation” is tough for any firm, but when you are $9 billion industrial manufacturer, it is a sizable undertaking. At last week’s TG18 ToolsGroup user event, global bearing manufacturer SKF laid out an impressive review of their transformation to “Integrated Planning”.…
Editor’s Note: Last year ToolsGroup became Microsoft’s partner for Multi-echelon Inventory Optimization (MEIO) in Industrial accounts. Microsoft’s Bill Moffett and I collaborated on an introductory blog on MEIO for manufacturing businesses. You can see Bill’s version here on the Microsoft website and my slightly abridged version below. Imagine a worker…
Blockchain data can be a useful source of certified data to support the supply chain model or sometimes called a "supply chain twin". With all the hype around Bitcoins, you’ve probably at least heard of the distributed database technology known as blockchain. But blockchain isn’t just for cryptocurrency and other…
ToolsGroup announced today that it has taken a top position in the "Leaders" quadrant of Nucleus Research's Inventory Optimization Value Matrix for 2018 for the fourth year running. Software vendors in the Leaders quadrant provide advanced machine learning technologies combined with exceptional usability that allows customers to easily gain insights…
Many retailers consider competing against Amazon their biggest challenge. While the impact of Amazon is real, it is only a thread in the larger retail competition tapestry. Amazon offers breadth, but brick and mortars offers “now”, and a tactile consumer shopping experience is still a retailer’s greatest asset. That is…
Eight years ago ToolsGroup was one of the first supply chain planning software vendors to employ machine learning to improve demand forecasting. As the tag line to a popular commercial goes, by now “we know a thing or two because we've seen a thing or two.” When we first began…
Last week we discussed a Gartner framework for gauging inventory health, but noted that the Inventory Quality Ratio (IQR) could take a while to implement (Click here to read last week’s blog). This week we look for a relatively quick way to assess inventory health, so we turned to Gerrott…
Financial executives measure inventory health with metrics like inventory turns because they view the firm from a financial viewpoint - such as how much working capital is being tied up. But from an operational supply chain planning perspective, turns is a crude metric because it doesn’t recognize the difference between…
Planners working with complex supply chains will find that artificial intelligence systems will free them for more interesting work — and could even lead to rising in the company ranks. Society has mixed reactions about the forward march of artificial intelligence (AI). People naturally and often reasonably fear AI-based systems…
Trade promotion forecasting is difficult: getting it right involves factoring in many variables. Marketing people, who are often responsible for it, may excel at creating and running promotions. Forecasting demand data, not so much. This can leave supply chain professionals the tough job planning for, and responding to, promotions. To…
Grocery stores, long thought to be immune to the “Amazon Effect”, were shaken in August of 2017 when Amazon acquired Whole Foods. While companies like Instascart and Peapod have provided home delivery for years, this acquisition was like a shot across the bow for many grocers. About 40 million homes…
You should be interested in applying disruptive technologies in your supply chain not only at a physical level, like in transportation and logistics, but also at a more virtual level in your supply chain planning. And you should be thinking about them now, because disruptive technologies have a first mover…
Gartner has identified five stages of supply chain planning maturity and they say that 70-80% of companies plan to increase their supply chain planning (SCP) technology spend over the next two years to climb to the next level. In their recent report titled Carefully Assess Which Tools Are Right for…
In recent months four experts have weighed in on Demand Driven Material Requirements Planning (DDMRP). Here is an overview of those reviews, followed by my own short commentary, plus links to the articles at the end of the post. Lora Cecere of SC Insights was the first of the supply…
Gartner says we are entering what they call the ‘Experience Economy”, where personalization, speed, agility and the ability to predict consumer trends before they happen will separate the winners from losers (Aspire, Challenge and Transform in a Disruptive World, 27 September 2017). Gartner cites the customer experience example of guaranteeing…
Since machine learning is a hot topic, we thought it useful to clarify the difference between machine learning and traditional statistics as applied to supply chain planning (SCP). Both technologies help you better understand data and are classified as analytics, but each takes a very different approach. By understanding the…
At first glance, a discussion about clothing and technology seems a bit incongruous, even for a retail focused blog. What could a dress possibly have to do with running your business? But they are more closely related than you may realize. Let me explain how. The little black dress is…
I’ve always maintained that improving demand forecast accuracy, as helpful as it can be, shouldn’t be the end goal itself, but simply a means to the end. A recent report from Gartner agrees, focusing specifically on the challenge of building a better business case for improved forecast accuracy. Gartner says…
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Inventory planning is especially important to small-to-midsize businesses (SMBs). Nobody wants to tie up more working capital in inventory than necessary, but SMBs typically have a higher cost of capital, so it’s more expensive to fund excess stock. And if a company is growing rapidly, capital may not only be …
In my first blog post in 2014 (What Drives Your CEO in the Corner Office) I reported that a Gartner survey showed that CEOs prioritize growth over cost savings. I advised supply chain leaders to ensure that their initiatives were seen by chief executives as engines for growth. Fast forward…
Here are five predictions: #FinStock #ToolsGroup We have tackled the question of automation before, but his time I want to focus specifically on what automation will mean to the job of the supply chain planner. There is a saying that the best forecasts come from having access to inside information…
Have you seen the latest Gartner S&OP Magic Quadrant? #ToolsGroup #machinelearning #FinStock Gartner Research just released its new Magic Quadrant for Sales & Operations Planning Systems of Differentiation (S&OP SOD). They say that compared to just two years ago “there have been significant shifts in the relative positions of several…
latest innovations in S&OP and machine learning advanced analytics
POS data helps sense and respond to localized demand. The blue bars represent historic average order demand profiles, while the colored lines represent regional POS demand patterns. Source: Supply Chain Insights, “The Power of Downstream Data”, July 2017 Editor's Note: Due to the summer holidays, there will be no blog…
ToolsGroup announces a major new release of its 'Powerfully Simple' supply chain planning (SCP) software, SO99+ 8.0, bolstered by a new technology integration with Microsoft. With this release, ToolsGroup migrates its software to Microsoft Azure and its machine learning engine (MLE) to Microsoft AI - an open artificial intelligence (AI)…
Doctors look for specific symptoms when diagnosing what’s wrong with a patient. Now with Gartner’s help, supply chain execs can do something similar with their supply chain planning (SCP) system. In a recent report (What's Wrong With Your Supply Chain Planning Technology, 18 August 2017), Gartner analyst Tim Payne lists…
For several years there has been a commonly held belief that focusing on improving demand forecast accuracy should be a top priority for Chief Supply Chain Officers (CSCOs). But according to recent reports by Aberdeen Group, we are seeing evidence of an important shift in this thinking. According to multiple…