Supply chain optimization is an unusual balancing act that requires finesse, skill and timely data. Every supply chain’s the key questions to be answered are:
- What to Buy? -- what are the factors in determining your optimal product mix and set of suppliers.
- How much to Buy? -- what are the most and least popular items at any given time interval
- When to Buy? -- long lags in delivery timing may tax limit your flexibility and influence your inventory management practices.
Product mix, supplier mix, turnover and restocking time (and distance) each contribute to the complexity of supply chain planning and management. When you add in shipping logistics, weather and other factors, these add even more to complicate the predictability of the supply chain.
- The simple Min-Max planning is a common supply planning method that requires the minimum and maximum quantities to be specified by the user.
- The re-order point planning method, where the safety stock needs to be specified.
- The demand forecasting model, of course, is a very big part of supply planning.
- Minimum and Maximum quantities per SKU
- Safety Stock per SKU
- Supplier lead time per SKU
Ashwin Pingali, PhD, is the CTO for DZee Solutions and Apps Consultants, companies focused on improving business operations through big data, AI and graph technologies.
Dr. G loves data. His favorite part of work is daydreaming up innovative solutions to quantifiable problems and planning an implementation strategy. Building intelligent systems is his passion whether it’s automated derivatives trading bots, adaptive image processing algorithms, or autonomous musical composers. Whether deep learning is the optimal solution or not, helping customers succeed through solving their analytics problems is where Graham finds the most satisfaction.