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Developing an Integrated Sales & Operations Planning Solution

Know how Tredence adopted a phased implementation<br>approach and deployed the S&OP solution in the<br>retailer's five fulfillment centers. <br>Learn more- https://www.tredence.com/services/supply-chain-management

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Developing an Integrated Sales & Operations Planning Solution

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  1. CASE STUDY Developing an Integrated Sales & Operations Planning Solution for a retailer with 500+ warehouses to reboot demand and supply dynamics

  2. Customer Context As a leading retailer with $50+ billion in sales and 500+ warehouses, the client wanted to develop an automated sales and operations planning solution for their fulfillment centers (FCs) based on demand forecasts and supply capacity constraints. Historically, the client’s solution had forecasting accuracy issues, requiring manual intervention in operations and supply planning. Therefore, they wanted to partner with a change agent and develop an automated sales & operations planning (S&OP) solution that can – Generate bottom-up and top-down demand forecasts Provide recommendations for transportation plans and truck pickup schedules The objective was to improve demand & supply dynamics and streamline the S&OP process to enhance customer experience, thereby reducing planning cycle time. Our Solution Approach We helped the client build a custom, agile, and scalable S&OP solution following a three-step approach: Outbound Order Planning Module Arrive at one planning number agreed by all stakeholders Carrier Scheduling Module Align supply-side & demand-side dynamics Web-App Module Orchestrate and monitor the planning performance 2 © 2022 Tredence. All Rights Reserved.

  3. Creating a Comprehensive Demand Consensus Module for all Outbound Planning Orders Tredence took a unique approach to generate highly accurate forecasts using an ensemble of more than 15 algorithms (mix of time-series, machine learning, and packaged algorithms like Facebook Prophet) on data extracted from multiple sources. The result The module successfully generated accurate outbound forecasts for each fulfillment center at the category level. The approach alsoprovided the client a buffer of one month to streamline their operational planning. 3 © 2022 Tredence. All Rights Reserved.

  4. Building a Carrier Scheduling Module to Drive Consensus Tredence developed an automated carrier scheduling module based on capacities & constraints pertaining to each route and carrier combination. The optimization algorithm was purpose-built to minimize carrier costs and reduce various constraints on capacity, routes, shipping, and carriers. The result The module allowed the client to plan trailer-level outbound shipments one month in advance. Establishing a Single Source of Truth with Custom Web-App Module With extensive experience in full-stack development and functional supply chain knowledge, Tredence designed and developed a cloud-based and lightweight web application architec- ture for the client to orchestrate and monitor the entire S&OP process through a single dash- board to build trust and improve collaboration between the stakeholders. Data Sources Data Engineering Model Building Deployment Monitoring Analytical Datasets Batch ETL Model Developments / Experiments Web - App for Planners Data processing Planner Data cleaning & validation The result The solution provided the client to adjust the forecast numbers based on trade promotions or FC ramp-ups and rerun the demand planning and carrier scheduling module. 4 © 2022 Tredence. All Rights Reserved.

  5. The Bottom Line: The client leveraged our Integrated Sales & Operations Planning (IS&OP) to streamline operations and reach a consensus between demand plans & supply factors. Tredence adopted a phased implementation approach and deployed the S&OP solution in the retailer's five fulfillment centers. The approach enabled the client to organize and coordinate their sales and operations planning processes, providing transparency and visibility to all stakeholders involved in the S&OP cycle. The impact : 10% Improvement in the stock availability across five fulfillment centers (FCs) 8% Reduced overall outbound transportation cost 5-15% Increased order forecasting accuracy 50% Reduction in S&OP cycle-time (from 4 weeks to 2 weeks) Want to know more about us? Visit: www.tredence.com/industires/supply-chain © 2022 Tredence. All Rights Reserved.

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