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Unlock the Working Capital in your Supply Chain

Unlock the Working Capital in your Supply Chain . Tuesday 23 rd October 2012 Mike Spragg, Vice President – Logility EMEA. Agenda. Supply Chain Planning – Crucial in Today’s Economy for Releasing Working Capital Introduction to Logility Customer Testimonial.

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Unlock the Working Capital in your Supply Chain

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  1. UnlocktheWorking Capital in your Supply Chain Tuesday 23rd October 2012 Mike Spragg, Vice President – Logility EMEA

  2. Agenda • Supply Chain Planning – Crucial in Today’s Economy for Releasing Working Capital • Introduction to Logility • Customer Testimonial

  3. .... And in Supply Chain terms? Where are you? But you can’t be because there is an efficiency barrier You are here Total Supply Chain Costs due to: Lead time Supply variability Demand variability Order size Order frequency Etc Better Service for same money Same Service with reduced Supply Chain Costs You’d love to be here! 100% Service Level

  4. Why do companies hold inventory? To cover uncertainty in demand

  5. Inventory Means Different Things to Different People Warehouse Manager Finance Director

  6. Why do companies hold too muchinventory? • In a complex supply chain, they don’t 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)

  7. Better Demand Forecasters Have… • 15% less inventory • 17% stronger order fulfillment • 35% shorter cash-to-cash cycle times • Fewer stock outs 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

  8. A real end-to-end Supply Chain...... Inventory is everywhere ⟰ Supply ⟰ ⟰ Demand ⟰ Suppliers Manufacturing Distribution Customers This is where Logility can help

  9. Innovative  Proven  Reliable Global provider of collaborative supply chain software solutions Over1,250customers in more than75countries Comprehensive best of breed SCM product suite 40+ years of supply chain expertise

  10. OUTPLAN●OUTPACE ●OUTPERFORM

  11. Logility Solution Overview Historic Demand • Forecast • Forecast Error Lawson Movex / M3 • Multi Echelon, time-phased, Safety Stock targets Collaboration • Current Supply Chain status: • (Inventory, Expected Receipts, Orders) • Production • requirements • Time-phased multi-echelon • Replenishment plan/Allocations Constrained Production Plans

  12. Voyager in the Real World Inventory is everywhere ⟰ Supply ⟰ ⟰ Demand ⟰ Suppliers Manufacturing Distribution Customers

  13. Industry Validation

  14. Logility: A LeaderGartner SCP Magic Quadrant • “Logility is a vendor that always gets great user feedback, since its users are typically very satisfiedwith 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

  15. Logility - Industry Presence Consumer goods Durable goods Electronics Personal Care Food & Beverage Process/ Chemicals Service/ Aftermarket Life Sciences Retail Home Furniture Softgoods/ Apparel Wholesale/ Distribution

  16. What Do These Companies Have In Common? They all run Logility SCP solutions alongside their Lawson M3 ERP installations.

  17. Sandvik Mining and Sandvik ConstructionAfter Market Business Spare Parts, Service Tools

  18. Characteristics of a supply chain – our starting point Low visibility - tail and head disconnected Long lead times Waste Unpredictable raw material supply High inventory Low agility to market demand

  19. What is the most important competitive requirement for each sub-supply chain ? Parts Tools Supply Chain performance dimension Example metrics Competitive Best • Delivery performance to standard lead time • Delivery performance to customer request • Fill rate Delivery performance • Upside flexibility • Supply chain response time • Inventory and supply visibility Flexibility andresponsiveness • Order fulfilment lead time • Order fulfilment lead time(Time from order to delivery) • Distribution cost Cost • Inventory Days of supply (RM+WIP+FG) • Cash-to-cash cycle time Assets

  20. Requiring two separate distribution supply chains with different characteristics • 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) Tools 1 • 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 Parts 2

  21. One size doesn’t fit all is valid for supply chain as well

  22. 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

  23. 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.

  24. Feel free to get in touch... James Lamptey jlamptey@logility.com 07917 708 870 Logility web site - www.logility.com Rich source of supply chain information, knowledge, best practice, case studies, videos, white papers...

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