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demand planning & inventory optimization

Supply Chain Management aims at improving competitiveness of the supply chain as a whole, by integrating organizational units along the supply chain and by coordinating material, information and financial flows in order to fulfill (ultimate) customer demands (Sect. 1.1). Supply Chain Management projects range from functional improvements on the IT level to large-scale change programmes. Functional improvements might be the introduction of a new forecasting method or the adjustment of the master planning optimization profile. Examples for larger SCM projects are the optimization of the supply chain network, the redesign of the planning processes or the adjustment of the business strategy based on SCM concepts. In either case, the goal of SCM projects is to improve competitiveness of the supply chain. In recent years since the peak of the e-business hype Supply Chain Management and especially Advanced Planning Systems were viewed more and more critically by industry firms, as many SCM projects failed or did not realize the promised business value. There are three reasons for that. The first reason for the failure of SCM projects is the perception “that the more you spend on IT (e.g. APS) the more value you will get from it” (Willcocks et al. 2001). This attitude leads to technical capabilities searching for business problems to be solved. The role of IT (and APS) was clearly overestimated in the past as the single source of business value. In order to get “value” out of an APS implementation the SCM concept must be formulated prior to the APS implementation. The SCM concept defines the needs and priorities for the APS implementation; the APS supplies advanced planning functionality to be utilized by the SCM concept. For example, the SCM concept describes the network organization, the planning processes and the supply chain performance targets and indicators.