Software optimizes production and inventory levels.
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Press Release Summary:
PowerChain(TM) Echelon provides what-if analysis, enabling manufacturers to evaluate effects of real-world variability to meet customer demand within physical and cost constraints of facility. It helps companies identify optimal configurations, material sourcing, manufacturing processes, distribution methods, and inventory policies. Software calculates safety stocks, reorder points, and standard lot sizes, and minimizes total production and inventory costs.
Original Press Release:
Optiant Unveils PowerChain Echelon
New Software Optimizes Production and Inventory Levels For Shared Manufacturing Facilities
BOSTON (May 20, 2003) Optiant today released PowerChain Echelon, the first solution designed specifically to help manufacturers who make and store products in the same facilities tackle a major challenge: how to balance production efficiency and inventory levels. Based on Optiant's robust optimization technology, PowerChain Echelon delivers the ability to meet customer demand, reduce exposure to excess inventory and minimize overall operational costs.
Until now, manufacturers with shared production and warehousing facilities struggled with the dilemma of how much and when to produce a particular batch based on capacity constraints, seasonality issues and fluctuating customer demand. Key stakeholders evaluated customer demand, set-up time, throughput, changeover and inventory carrying costs, using often-flawed rules-of-thumb and previous experience to determine production strategies. By tying a dollar value to each operational element and optimizing within realistic constraints, PowerChain Echelon delivers the vital - and quantifiable - intelligence supply chain stakeholders need to weigh trade-offs and make decisions that meet business goals.
"The right batch and lot sizes are critical to profits and flexibility, from the Fortune 500 to million-dollar privately-held operations," said Julie Fraser, principal, Industry Directions. "Current APS and lot sizing solutions may help, but do not fully factor in supply chain costs and uncertainties as they create batch and lot sizes. With Echelon, Optiant is leveraging its proven optimization technology to help companies find that elusive balance between efficiency, inventory levels, and cycle times."
PowerChain's unique 'what if' analysis enables manufacturers to evaluate the effects of real-world variability to optimize production and inventory levels and meet customer demand within the physical and cost constraints of a particular facility. To help key stakeholders identify and implement the best possible policies, the software quickly and easily:
o calculates safety stocks, reorder points and standard lot sizes
o minimizes total production and inventory costs
o satisfies services levels, plant capacity and warehouse capacity constraints
o incorporates the effect of demand and demand variability, throughput and throughput variability, planning and queue times on required safety stock
o performs sensitivity analysis to determine key parameters that affect resulting costs
"When a manufacturer is constrained by capacity, optimizing batch sizes becomes critical," said Jim Lawton, vice president of marketing at Boston-based Optiant. "By helping manufacturers better understand the effect of decisions on overall costs and performance, Optiant is providing the information needed to create effective supply chain and inventory policies."
Real-world application
A building materials manufacturer has already reaped the benefits of Optiant's unique approach by using PowerChain Echelon to optimize one of its most popular product lines. The company uses the same facility for all varieties of specific building materials, making it time consuming and costly to switch lines between runs for the various colors, textures, and finishes. Due in large part to these challenges, the manufacturer initially sought to save money by producing a large quantity of a single type of material. Unfortunately, this strategy led to a warehouse full of inventory and new risk on the balance sheet. By taking advantage of PowerChain Echelon, the manufacturer has doubled inventory turns and reduced inventory costs by over $2.5 million. Thrilled with the results, the company is now rolling out the solution to 3 additional facilities.
The PowerChain Suite
Optiant's award-winning PowerChain suite gives leading manufacturers the intelligence they need to design profitable supply chains - tying dollar amounts to key supply chain decisions. he innovative software tackles supply chain efficiency and cost from a strategic level, helping companies identify optimal configurations, material sourcing, manufacturing processes, distribution methods and inventory policies. By taking a collaborative approach - eliminating decisions made in isolation - and tying supply chain decisions to overall business performance goals, Optiant helps manufacturers reduce costs and mitigate real-world disruptions and fluctuating demand. PowerChain Echelon complements Optiant's other flagship products, PowerChain Architect and PowerChain Inventory, delivering a solution that optimizes the performance of the end-to-end supply chain, while ensuring that key capacity-constrained points are able to support the global strategy.
About the Company
Optiant is a pioneer in the emerging market of supply chain design and optimization. Optiant's flagship software solution, the PowerChain suite, enables global organizations to design and configure optimal supply chains, solving real-world problems today. PowerChain determines cost-effective inventory placements and integrates supply chain strategy into sourcing and distribution processes for quantifiable results in less than ninety days. Optiant has proven that intelligent inventory policies improve customer service levels and provide rapid ROI by driving out millions of dollars of associated costs from complex supply chains. Our roster of blue-chip clients, including Global 1000 discrete manufacturers, utilizes Optiant's expertise to design competitive supply chains and innovative inventory policies. PowerChain solutions are built on patent-pending optimization technology based on more than ten years of leading-edge research and industry partnerships at the Massachusetts Institute of Technology. Optiant is a privately held company headquartered in Boston, Mass., and can be reached at www.optiant.com or (781) 238-8855.
Optiant and PowerChain Suite are trademarks of Optiant, Inc. All other trademarks are property of their respective owners.
