Supply Chain Brain

those to come up with a globally optimal solution, he says. “These
five functions are applicable in about 80 percent of all supply chain
problems,” says Basmajian. “We can look at each function with an
eye on global optimization and do a much better job generating
answers that will get us close to end-to-end supply chain optimiza-
tion, without making a large financial commitment up front.”
Another constraint to optimization has been its foundation in
the academic community, he says. “Academic solutions when
applied in the real world sometimes do not generate useable
answers,” Basmajian notes. “One of the approaches we have
found that works is to modify mathematics to fit the real-world
problem rather than trying to recast a real-world problem to fit
into an academic solution.”

Managing Your Parcel Shipping Spend

Parcel shipping has grown dramatically over the past two decades, but many companies have neither the time nor technology to manage parcel spend effectively, says Jim Jacobs, executive vice president, Green Mountain Consulting. As a result, they are turning increasingly to third parties and to parcel management solutions, which can reduce spending in this category by anywhere from 8 to 30 percent.

Achieving those savings requires an ability to crunch millions of records, Jacobs says. “Big parcel shippers could be shipping 5 million to 30 million shipments per year. You can’t do analytics on that amount of data using Microsoft Access.” Jacobs says that the partner group at Green Mountain are the people who wrote the billing system at Federal Express, “so they know how to crunch a lot of numbers and come up with the right answer.” One large pharmaceutical customer, he says, saved 28 percent of its total parcel spend using Green Mountain’s entire suite of services.

Does Your Company Need a
Demand Signal Repository?

A demand signal repository is a collection of customer data from many different sources that can provide users with a comprehensive view of sell-through activity on their products —knowledge that can be used to align supply planning with actual demand.

In a retail environment, a DSR might be populated with point-of-sale data, shelf prices and information around planned promotions, says Guy Yehiav, vice president—sales and strategy, at Oracle. It may also gather information on shipments and inventory depletion, he says.