Imagine if flight schedules were handled at each individual terminal – or even worse, each of the 128 gates independently: there would be instant chaos.
Similarly, by not optimizing your supply chain visibility and inventory management to operate from a unified platform, your organization’s processes might be running the risk of becoming, perhaps not entirely chaotic, but certainly less efficient than they could be.
Managing Complex Supply Chains
Modern manufacturing supply chains are getting increasingly complex in order to achieve the capabilities necessary to accommodate new market requirements. However, when it comes to inventory management, all parts of the supply chain still need to operate in unison with each other to maintain high efficiency. This means that across all stages of the production process, elements such as raw materials suppliers, production facilities, warehousing and distribution need to both provide and receive accurate real-time information that can enable them to maintain appropriate supply levels and deliver the right goods in a timely manner.
Keeping track of vast amounts of data and delivering on complex requirements is not an easy task for any organization. This is why inventory optimization capabilities, coupled with advanced demand and forecasting, are becoming core system requirements for all manufacturers. The main goal of this is to allow for a lean operation that requires you to keep less money tied up in raw materials and finished goods as well as ensure fast distribution to keep customer satisfaction high.
Inventory Optimization Drives Supply Chain Efficiency
Fortunately these two things go hand in hand, once a company effectively optimizes its warehouse management processes it becomes easier to identify next steps and carry this optimization throughout the entirety of the supply chain.
Key marks of a good inventory optimization system is its capability of identifying optimal material/component requirements at each individual step of the production process. Using advanced analytics and applying machine learning algorithms to statistical data can not only help you keep inventory costs in check but also automatically adjust to changes in demand based on future forecasts. This ensures you’re well equipped to deal with disruptive trends.
The final outcome of the implementing such a system is to allow you to generate and feed demand forecasts into the WMS module – which can autonomously adjust inventory for all production steps. Most legacy systems segment this process by compartmentalizing optimization efforts to only a portion of the supply chain since they’re forced to work with incomplete data. By eliminating these segmentations and unifying the whole process on a cloud platform, manufacturers can achieve dramatic improvements to their working capital, lower operating costs, and have better quality of service.
Stay ahead of Competition
With rising customer requirements and levels of competition putting added pressure on internal operations of manufacturers, an increasing number of companies are prioritizing process optimization to gain an edge over the competition.
Start your journey towards process digitalization with Merit Solutions. We can assist your organizations in identifying applications for the production data you’re currently collecting and work with your team to take your inventory management to the digital age.