Collaborative planning, forecasting and execution just got smarter

Improved order fill rates, reduced stock-outs, slashed inventory, better forecasting and lower operating costs are among key benefits claimed for a new combined supply chain planning and execution IT suite launched by former warehouse management systems specialist EXE. The firm’s Exceed AIM (Adaptive Inventory Manager) builds on its Exceed Fulfil and Collaborate modules, introduced over the last 18 months, to help global manufacturer/distributors better manage their internal and external supply chains and inventories, matching sanitised demand and supply in real time. Exceed AIM performs all of the demand forecasting, replenishment planning, purchase order generation, order sizing, buyer review and store product allocation functions to achieve its goals, allowing buyers and planners to work from a single coherent plan. EXE describes it as matching available distribution capacity to production and purchasing, taking into account history and a range of other relevant factors. And it does seem very sophisticated. EXE’s international director of marketing Steven Buckley says, for example, that it uses “simulative forecasting” to get around the practical problems of CPFR (collaborative planning, forecasting and replenishment) which, he believes fails for several reasons, but in particular due to ‘buncing’ – retailers’ vested interest in over-forecasting sales uplift from promotional offers to give them higher margin remaining stock, but with the knock on of delayed subsequent orders. “Supply chain ‘partners’ are never going to share all of the data,” he observes. And improving on collaborative forecasting is one of the key benefits of EXE’s software. “AIM starts by looking at the physical constraints of the network to handle forecast production and distribution requirements and spots the uneconomic orders in logistics terms,” he says. “It then looks at existing production and buffer stocks, the logistics networks’ capacity and velocity, and automatically deals with purchasing and remote warehouse management to optimise efficiency throughout.” And the system includes workflow and exceptions and alerts management. Other benefits include reduced purchasing costs through more efficient buying, reduced obsolescence and expired inventory through faster inventory velocity and reduced transport costs by cutting back on rush deliveries. Costs vary according to scale and complexity, but Buckley claims that an entry level system license cost would be around $150,000. At the other end of the scale cites a 1,000 named user system costing around $1 million. And he says that in hardware infrastructure terms, since it’s NT-based, costs are less than a tenth those of some of its competitors. Additionally, EXE claims fast implementation and low operating costs, leading to rapid ROI (return on investment). Office supplies wholesaler SP Richards, which has implemented the system in its US logistics operations provides testament. Lenny Rinaldi, purchasing manager: “We’ve experienced significant improvements in our buyer productivity and demand forecasting accuracy. These have increased inventory turn rates while at the same time increasing our order fill rates and customer service levels.”