Material Management Trends 2013: Flexible Planning for Reliable Inventories

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INFORM sees huge growth potential with cloud computing services

Flexibility and availability have been highlighted as the hottest supply chain topics of 2013 by the Inventory & Supply Chain division at INFORM. Given the high levels of volatility, inventory cost optimization – achieving high service levels while simultaneously maintaining the minimal levels of inventory – is proving an increasingly difficult balancing act. However, over the next 12 months, the Inventory and Supply Chain division envisage huge growth potential for cloud technology as they present some completely novel approached to inventory management. In addition, they plan to achieve growth across Europe through further expanding their international sales activities.

“Although businesses today are faced with a whole host of factors, the current economic climate seems to be causing the most headaches. As a result, organizations are now under more pressure than ever to cut redundant stock and improve liquidity. Thus, it is not surprising that achieving maximum availability while simultaneously cutting inventory levels has become such a major concern for our customers. However, through utilizing operations research algorithms, even large amounts of company data can be analyzed in order to support inventory decision making. This is especially true for organizations with complex distribution networks where additional stock reductions can be achieved through adopting a multi-echelon approach,” comments Ludger Schuh, head of the Inventory & Supply Chain division at INFORM. At this year’s LogiMAT event in Stuttgart, INFORM will introduce the multi-echelon concept: a new innovative approach for optimizing inventory across the entire network.

As fierce globalization renders traditional simple supply chains obsolete, interest in cloud technology is growing among the business community. Modern supply chains now stretch across numerous continents and encompass multiple time zones. As a result, managing supply chain data efficiently is becoming an increasingly difficult task. However, cloud has the capability to integrate everyone across the supply chain and provide all those involved with real-time access to the constantly growing amount of data.

More Flexibility through Cloud-based Services

“As highlighted by our recent survey, despite a huge amount of interest in cloud computing, the actual adoption rates remain relatively low. This is surprising considering how well suited cloud computing is for IT applications, especially those which are used only once a year such as inventory taking software. With license fees and installation costs replaced by a single usage fee for each stock take, the cloud also offers more flexible access to the most up-to-date data. Cloud-computing is also particularly advantageous for processes, such as sales planning where numerous planners work together from different international locations simultaneously. As a result, we envisage great potential for cloud technology in 2013, especially in the field of global sourcing”, says Karsten Horn, director of international sales, Inventory & Supply Chain division at INFORM.

Given the recessionary climate, Horn also highlights how flexibility is especially advantageous for the businesses competing in the UK market. For example, in the food and beverage sector there is already growing demand for tools that support demand planning optimization.

The adoption of operations research and cloud technology offers businesses a range of tangible benefits. For instance, thanks to innovative operational research algorithms, it is possible to reduce inventory levels by up to 40%. Even mid-sized organizations can release millions of euros worth of tied up capital through optimizing their inventories.

Increased Growth through International Sales & Distribution

Another topic high on the agenda of the Inventory & Supply Chain division at INFORM for 2013 is the expansion of its international sales activities. “After the successful establishment of our sales and distribution partnership in Austria, we want to extend our sales activities in the UK. Our long-term goal is to develop new markets for our inventory optimizing and demand planning solutions across other European countries through developing local partnerships”, explains Horn.

In addition to participating in prominent logistics events such as LogiMAT in Stuttgart, Logistics Link North in London and IMHX in Birmingham, INFORM increasingly depends on its own events such as roadshows, site visits and webinars to further develop relationships with customers in 2013.

All in all, Ludger Schuh, head of Inventory & Supply Chain, remains optimistic about the coming fiscal year. “The uncertain environment businesses operate in now means organizations must scrutinize every opportunity to ensure the benefits negate the cost. However, our systems can provide businesses with peace of mind through accurate forecasts enabling them to achieve maximum availability with the minimal inventory levels which in these times of economic turbulence is a huge strategic advantage.”

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