ILOG Supply Chain Applications
Customer Success Briefs
Customer: An industrial parts manufacturer
Industries: Supply Chain and Manufacturing
Solution: ILOG Inventory Analyst
Competition and the opportunity to lower manufacturing costs led a leading metal component manufacturer to move the manufacturing of certain products from the United States to China. Although the decision had already been made, company executives wanted to understand its inventory implications.
The company had to consider various business complexities. Suppliers had unique contractual terms, and some customers required different service level requirements. To further complicate matters, customs clearance had a direct impact on the order-to-receipt time of raw materials.
Realizing they needed a sophisticated way to manage their inventories, the company chose ILOG Inventory Analyst to estimate the level of inventory required in the new configuration, and to determine where it should be positioned.
Learn more about how how this industrial parts manufacturer uses ILOG Inventory Analyst.
Customer: A global plastic goods maker
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
A global manufacturer of plastic accessories undertook an initiative to rationalize the manufacturing network of their fixtures division in order to improve customer service levels and streamline costs. With seasonal business and tight production capacities, determining the best way to build inventory for peak demand was a key issue. Increasing the fixtures' capacity to meet the next year's demand was yet another challenge.
The company worked with ILOG to determine the optimal month-by-month production plan for each product in order to meet customer demand, re-allocate assets to better utilize capacity, and determine the number and type of machines to buy for each facility.
ILOG LogicNet Plus XE helped the company meet 100 percent of their customer demand and reduce costs by US2.4 million, which gave them earnings of US3 million before interest, taxes, depreciation and amortization (EBITDA), as well as an increase of US0.6 in sales. They also significantly reduced the number of expedited shipments and transfers between facilities, which provided additional savings above and beyond the EBITDA impact.
Learn more about how this plastic goods maker uses ILOG LogicNet Plus XE.
Customer: A global auto parts manufacturer
Industries: Supply Chain and Manufacturing
Solution: ILOG Inventory Analyst
A global auto parts manufacturing firm serving both original equipment manufacturer (OEM) car manufacturers and after-market parts retailers. This multi-tier network includes a central distribution center (DC) in China, five regional warehouses and 20 country warehouses worldwide. Components are shared across multiple assemblies.
The company's supply chain is currently configured to efficiently serve OEM customers, but is not adequately serving its after-market parts retailers. Management needs a supply chain strategy to accommodate both types of customers and reduce overall supply chain costs. They assume that this can be achieved by improving forecast accuracy and increasing lead times to customers.
Learn more about how this auto parts manufacturer uses ILOG Inventory Analyst.
Customer: An industrial and farm machinery maker
Industries: Supply Chain and Manufacturing
Solutions: ILOG LogicNet Plus XE
A manufacturer of heavy industrial and farm machinery obtains 6.5 percent of its total revenue from its sale of repair parts. These parts are produced at 50 different locations, most by third-party suppliers. The parts are distributed though more than 1,800 dealer locations throughout North America. The company supported this network with 14 distribution centers (DCs). Of these centers, three handled most of the demand.
The parts maker undertook a major initiative to increase the speed at which it delivered parts. The objective was to rationalize the DC network and determine the right sourcing strategy for each part.
The company used LogicNet Plus XE to determine the optimal number of DCs and their ideal locations and most efficient service territories to reduce the company�s transportation and warehousing costs while still meeting customer service requirements. Using LogicNet Plus XE, the manufacturer reduced service parts distribution costs by 21 percent (US17 million annually) and significantly increased its ability to meet customer service requirements.
Learn more about how this industrial and farm machinery maker uses ILOG LogicNet Plus XE.
Customer: A major retailer
Industry: Retail
Solution: ILOG Inventory Analyst
A major United States retailer with billions in annual sales had seven distribution centers (DCs) to serve its stores. The retailer was growing rapidly through acquisitions and organic growth. This produced a hybrid inventory strategy with some stock-keeping units (SKUs) stored at all the DCs and others only at a few centralized locations. The assignment of SKUs was largely based on the practices of the acquired companies. The retailer wanted to determine whether its inventory strategy was appropriate for its business.
Using ILOG Inventory Analyst, the inventory planning solution from ILOG, the retailer was able to reallocate nearly 25 percent of its SKUs between the two strategies, with a projected reduction in transportation and inventory holding costs of more than US1.5 million
Learn more about how this major retailer uses ILOG Inventory Analyst.
Customer: A consumer packaged goods maker
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
As part of the process of globalizing its supply chain, a large consumer packaged goods (CPG) manufacturer undertook the rationalization of each of its division’s manufacturing networks. Since the products were relatively inexpensive, low cost manufacturing facilities, freight and duties became the focus of the study. The main objective was to design a global manufacturing network while minimizing total supply chain costs. SKU complexity due to varied market requirements made it difficult for a few plants to satisfy all customer needs.
The company leveraged ILOG's expertise in network modeling to first capture the current network configuration, and then to determine the best network of manufacturing facilities to minimize system-wide costs.
After deploying ILOG LogicNet Plus XE, the company was able to identify a net impact of US15 million to its
bottom-line through cost reductions. This was achieved primarily by rationalizing expensive assets and shifting production volumes to more cost-effective locations. The company also utilized their lower-cost and lower-duty shipping lanes to further reduce their overall costs.
Learn more about how this consumer packaged goods maker uses ILOG LogicNet Plus XE.
Customer: An electronics supplier
Industries: Supply Chain ans Manufacturing
Solution: ILOG Inventory Analyst
Executives at a contract manufacturer of circuit boards had long recognized that "make-to-stock" was not the ideal strategy for their supply chain. Long manufacturing lead times, short product life cycles and the pressure to shorten response times had constrained the company to a "make-to-stock" environment, creating significant inventory liability issues due to the risk of obsolescence.
After working with ILOG, the company developed a revised (hybrid) strategy where portions of the supply chain are "make-to-stock" (push) while others operate on a "make-to-order" (pull) environment. The end result was a supply chain with lower inventory holding costs, reduced inventory liabilityissues and—above all—increased customer service levels and reduced customer lead times.
By using ILOG Inventory Analyst, ElecComp has realized a dramatic reduction of 40-60 percenton safety stocks with existing customer lead times. In some cases, ElecComp was able to achieve a 30 percent reduction in safety stock, while reducing promised customer service time by 50 percent.
Learn more about how this electronics supplier uses ILOG Inventory Analyst .
Customer: A metal parts manufacturer
Industries: Supply Chain and Manufacturing
Solution: ILOG Inventory Analyst
The traditional view of the supply chain focuses on fulfillment.
Key drivers include:
- Uncertainty and variability, such as the "bullwhip effect"
- Lead times, such as off-shoring vs. on-shoring
- Economies of scale in production and transportation
Another view is the development supply chain. Its function is to coordinate the planning, designing and sourcing of components necessary for introducing a new product into the fulfillment supply chain. Key drivers in the development supply chain include:
- Industry clock speed, such as innovative vs. functional products
- Core competencies, such as make vs. buy
- Product design, such as modular vs. integral
New research suggests that significant financial benefits can be derived by identifying common or shared processes between the development and fulfillment of supply chains, in order to create a lean product design process. Lean product design involves manufacturing, engineering and supply chain divisions, with emphasis on postponement, modular products and standardization.
Learn more how about this metal parts manufacturer uses ILOG Inventory Analyst.
Customer: An electronics supplier
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
An electronics supplier recently undertook a major initiative to increase the speed at which service-repair parts were delivered to market. The objective was to rationalize network distribution centers (DCs) and determine the right sourcing strategy for each spare part.
The company leveraged ILOG LogicNet Plus XE to determine the optimal number of DCs, ideal locations, and the most efficient service territories to reduce overall transportation and warehousing costs while meeting customer service requirements.
Using ILOG LogicNet Plus XE helped the company reduce service parts distribution costs by 21 percent (
US$17 annually) and significantly increase their ability to meet their customer service requirements.
Learn more about how this electronics supplier uses ILOG LogicNet Plus XE.
Customer: A large food supplier
Industries Supply Chain and Manufacturing; Food and Beverage
Solution: ILOG LogicNet Plus XE
With the recent acquisition of a new business unit from a competitor, a large food supplier faced the daunting task of merging two complex networks and planning for warehouse requirements in the combined network.
This food supplier sources their products from dozens of plants all over the world and ships to domestic customers through twenty mixing centers. Some products are shipped directly to customers. Due to limited plant buffer capacities, their products are pushed out to the mixing centers. Production and demand are highly seasonal and specific to geography.
The company’s main objectives were to cost-effectively combine the two networks and to analyze the impact of product seasonality on warehousing requirements. Various factors such as production plans, transportation costs, warehousing costs and capacities were considered.
Using ILOG LogicNet Plus XE allowed Nutrine to identify significant cost savings and improve customer service levels. Nutrine leveraged ILOG’s expertise to first determine the best combined distribution network and then analyze warehouse capacity requirements based on product seasonality.
Learn more about how this food supplier uses ILOG LogicNet Plus XE.
Customer: A computer parts maker
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
A major computer parts maker launched a CEO-driven, company-wide initiative to streamline its supply chain operations and increase profitability. The compamny manufactured their products in Asia and used an intermediate network of distributor facilities to serve their customers in the United States. They recognized that this layer of distributors resulted in very low visibility and long cash flow cycles.
In a pilot project focused on the distribution of disc drives in North America, the company collaborated with ILOG to understand the cost benefits of working more closely with their distributors and to explore the option of shipping directly to their customers.
They implemented ILOG LogicNet Plus XE to help analyze their options. They were able to eliminate the distributor layer in their supply chain and move to a direct-ship model to servicetheir customers. Doing so helped the company save
US4 million annually and it reduced the length of their cash-flow cycle by 50 percent.
As a result of increased supply chain visibility, overall inventory was reduced and the company was able to react quickly to changes in market conditions and customer needs.
Learn more about how this computer parts maker uses ILOG LogicNet Plus XE .
Customer: A printing systems supplier
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
Responding to aggressive competition, a manufacturer and distributor of printing and imaging hardware, needed to streamline finished goods inventory distribution and determine the right product sourcing strategy. The company selected ILOG to determine the optimal service territories, product mixes (SKU levels), and product allocation across its distribution centers while reducing total transportation costs.
By leveraging ILOG’s network design and planning solutions, Teknaprint reduced outbound transportation costs by 25 percent and delivery times by approximately 40 percent. The company also reduced its finished goods inventory by re-distributing inventory across their distribution centers.
Learn more about how this printing systems supplier uses ILOG LogicNet Plus XE.
Customer: A metal works supplier
Industries: Supply Chain and Manufacturing
Solution: ILOG LogicNet Plus XE
Global warming and related environment concerns have become key issues in boardrooms around the world. Companies are looking for ways to be "greener" by reducing their CO2 emissions, or carbon footprints. ILOG is helping companies achieve their environmental objectives through its LogicTools Suite of Supply Chain Applications.
This is the story of Metalworks, a hypothetical furniture maker. Metalworks is profiled after real, similar companies that have used network optimization software like the Carbon Footprint Extension for ILOG LogicNet Plus XE, to reduce their carbon footprints and operate more competitively and cost-effectively. Metalworks' objective is to reorganize its distribution network to deliver orders faster while cutting costs and CO2 emissions.
Learn more about how this metal works supplier uses ILOG LogicNet Plus XE.
Customer: Danone
Industries: Supply Chain and Manufacturing
Solution: ILOG Plant PowerOps
The Danone Group is one of the world's largest food and beverage companies, with 88,000 employees and worldwide sales figures of over EUR14 billion (over US$18 billion) in 2006. Based in Paris, France, Danone is the world's leading manufacturer of dairy products and bottled water, and the second largest manufacturer of biscuits and cereal products. The group's portfolio of brand names includes Danone, Evian and LU.
ILOG Plant PowerOps helped Danone:
- Increase service levels and operational efficiency
- Reduced inventory and production costs
- Improve flexibility and ability to react to unexpected events
- Implement a user-friendly solution for integrated planning and scheduling
Learn more about how Danone uses ILOG LogicNet Plus XE.
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