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Unlock the Working Capital in your Supply Chain Tuesday 23 rd October 2012 Mike Spragg, Vice President – Logility EMEA
© 2012 Logility, Inc.Proprietary & Confidential Agenda Supply Chain Planning – Crucial in Todays Economy for Releasing Working Capital Introduction to Logility Customer Testimonial
© 2012 Logility, Inc.Proprietary & Confidential Total Supply Chain Costs Service Level 100%.... And in Supply Chain terms? Better Service for same money You are here Where are you? But you cant be becausethere is an efficiency barrier due to:Lead time Supply variability Demand variability Order size Order frequency Etc Same Service with reduced Supply Chain Costs Youd love to be here!
© 2012 Logility, Inc.Proprietary & Confidential Why do companies hold inventory? To cover uncertainty in demand
© 2012 Logility, Inc.Proprietary & Confidential Inventory Means Different Things to Different People Warehouse Manager Finance Director
© 2012 Logility, Inc.Proprietary & Confidential Why do companies hold too much inventory? In a complex supply chain, they dont have the right tools to accurately predict demand for hundreds and possibly thousands of items, so they go on the safe side, and keep high inventories just in case they get an order The more accurately they can predict (forecast) demand, the less safety stock they need FORECAST ACCURACY affects SAFETY STOCK levels (The better the accuracy, the lower the safety stock)
© 2012 Logility, Inc.Proprietary & Confidential Better Demand Forecasters Have… 15% less inventory 17% stronger order fulfillment 35% shorter cash-to-cash cycle times Fewer stock outs 5% improvement in forecast accuracy=10% perfect order improvement 3% perfect order improvement=1% increase in profit margin Source: AMR Research, Debra Hofman, Perfect Order = ability to deliver and order to the customer that is complete, accurate, on-time and in perfect condition
© 2012 Logility, Inc.Proprietary & Confidential A real end-to-end Supply Chain Supply Demand Manufacturin g Distribution Inventory is everywhere Customers Suppliers This is where Logility can help
© 2012 Logility, Inc.Proprietary & Confidential Global provider of collaborative supply chain software solutions Over 1,250 customers in more than 75 countries Comprehensive best of breed SCM product suite Innovative Proven Reliable 40+ years of supply chain expertise
© 2012 Logility, Inc.Proprietary & Confidential OUTPLAN OUTPACE OUTPERFORM
© 2012 Logility, Inc.Proprietary & Confidential Collaboration Logility Solution Overview Historic Demand Forecast Forecast Error Multi Echelon, time-phased, Safety Stock targets Current Supply Chain status: (Inventory, Expected Receipts, Orders) Time-phased multi-echelon Replenishment plan/Allocations Lawson Movex / M3 Constrained Production Plans Production requirements
© 2012 Logility, Inc.Proprietary & Confidential Voyager in the Real World Supply Demand Manufacturin g Distribution Inventory is everywhere Customers Suppliers
© 2012 Logility, Inc.Proprietary & Confidential Industry Validation
© 2012 Logility, Inc.Proprietary & Confidential Logility: A Leader Gartner SCP Magic Quadrant Logility is a vendor that always gets great user feedback, since its users are typically very satisfied with their SCP solutions and deployments. Customers report good ease of use, strong references, fast ROI and responsiveness to suggestions for product enhancements. -Tim Payne, Research Director SCP Magic Quadrant, Sept. 2010
© 2012 Logility, Inc.Proprietary & Confidential Logility - Industry Presence Consumer goods Durable goods Electronics Food & Beverage Home Furniture Life Sciences Personal Care Process/ Chemicals Retail Service/ Aftermarket Softgoods/ Apparel Wholesale/ Distribution
© 2012 Logility, Inc.Proprietary & Confidential What Do These Companies Have In Common? They all run Logility SCP solutions alongside their Lawson M3 ERP installations.
© 2012 Logility, Inc.Proprietary & Confidential
© 2012 Logility, Inc.Proprietary & Confidential Sandvik Mining and Sandvik Construction After Market Business Tools Spare Parts, Service
© 2012 Logility, Inc.Proprietary & Confidential Characteristics of a supply chain – our starting point Low agility to market demand Waste Low visibility - tail and head disconnected Long lead times Unpredictable raw material supply High inventory
© 2012 Logility, Inc.Proprietary & Confidential Delivery performance Competitive Best Flexibility and responsiveness Cost Assets Order fulfilment lead time Tools Delivery performance to standard lead time Delivery performance to customer request Fill rate Upside flexibility Supply chain response time Inventory and supply visibility Distribution cost Inventory Days of supply (RM+WIP+FG) Cash-to-cash cycle time Order fulfilment lead time (Time from order to delivery) Example metrics Supply Chain performance dimension Parts What is the most important competitive requirement for each sub-supply chain ?
© 2012 Logility, Inc.Proprietary & Confidential Tools Parts Characteristics Fewer products, higher volumes Predictable demand Longer customer lead-times Competitive market place Own manufactured products Traditional product supply chain - Lean practices appropriate Transportation by sea and road (no air) Characteristics Many products, low volumes Un predictable demand Short customer lead-times Parts from external suppliers Spare parts supply chain – assortment is key High speed logistics Requiring two separate distribution supply chains with different characteristics
© 2012 Logility, Inc.Proprietary & Confidential One size doesnt fit all is valid for supply chain as well
© 2012 Logility, Inc.Proprietary & Confidential Why Sandvik Chose Logility… World Class Software Solution Supports Original Equipment and Aftermarket Modular Approach Configurable Software, adapts to changing business environment Ease of Use Intuitive, user friendly system for successful user adoption The solution handles complexity while being easy to understand Successful Implementations Quicker time to benefit than other solutions Track record of Successful Implementations Customer Focus Many long standing customers, successful partnerships
© 2012 Logility, Inc.Proprietary & Confidential Sandvik Results to Date Immediate improvements on fill rates compared to previous months After the 1st complete month, achieved a 100% fill rate on their targeted items. 44% Reduction in transportation costs Improved inventory planning to support safety stock policy to achieve a 98% service level.
© 2012 Logility, Inc.Proprietary & Confidential Feel free to get in touch... James Lamptey Logility web site - Rich source of supply chain information, knowledge, best practice, case studies, videos, white papers...
© 2012 Logility, Inc.Proprietary & Confidential
© 2012 Logility, Inc.Proprietary & Confidential
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