Defining a Logistics Strategy for your organization

For years, logistics was considered a mere support function and  in all strategic planning exercises, it was thought of as a function which did not provide any strategic value to the organization. For our generation of Logisticians, it is difficult to comprehend that this perception existed, since we have always been told that “Its not the…

Self driving trucks: Fleet of the future?

While doing my regular reading last weekend, I came across few articles from Forbes (link below for those interested) pertaining to truck driver shortage in US. Forbes on Truck driver shortage-I Forbes on Truck driver shortage-II Forbes on truck driver shortage-III Forbes on truck drivers shortage-IV Now carrier capacity crunch and driver shortages in a…

AI Enabled Optimization: Combining the best of Machine Learning and prescriptive optimization

We know that Optimization tools typically prescribe best-action recommendations, based on certain goals, conditions and potential trade offs. I am an Operations Research enthusiast so optimization methods are close to my heart. However, I believe that optimization methods, when combined with predictive tools, have the potential to deliver greater value to organizations by helping them achieve…

Will you let a Machine take over your inventory planning process? (Part 2/2)

In the first part, I primarily touched upon the limitations of current Off-the-shelf Inventory planning systems . That discussion laid the path to this second part-how we can leverage Machine learning to mitigate those limitations. In this part, we will dive into the crux of it. How exactly we can leverage Machine learning to actually…

Mapping your Supply Chain for a Network Design exercise

As Supply Chain optimization professionals, we are often so deeply involved in the granularities of algorithms or the datasets for our models that we often overlook the importance of one critical piece of documentation that every analytics department within the Supply Chain function should have-An end to end, high level map of your Supply Chain with key…

Designing a flexible Manufacturing Network

In a majority of Network design exercises, the focus is on finding the most cost optimal network , give various business constraints. However, as I have mentioned in my multiple posts earlier, there are so many aspects of network design that are not quantifiable. Incorporating some types of risk mitigation strategies in your network design or building…

Why your Supply Chain footprint matters

Supply Chain design is a key buzzword these days and every Supply Chain professional is somewhat familiar with what that means. One key aspect of any Supply Chain design strategic analysis is to evaluate whether your Supply Chain footprint i.e the location of your Plants, Warehouses etc. is optimal. So one of the questions you…

Leveraging Load Factor Modeling in Transportation Analytics

When you are looking for cost savings opportunities in your Transportation Network, a good area to explore is Transportation asset utilization. One of the tools that you can leverage to evaluate optimal utilization is Load Factor modeling, a pretty basic but powerful tool to explore your packaging, vehicle and fleet utilization. Though the name may sound fancy, the model is…

The changing landscape of Linear & Mixed Integer Programming Languages

When I used to avidly leverage algebraic programming languages for Supply Chain optimization modeling, my language of choice was AMPL. Last weekend I had the opportunity to read these two awesome posts from Peter Cacioppi and I think I agree with him. For individuals who leverage algebraic programming languages heavily, I will suggest them to read these posts….

Logistician’s complex challenge: The Last Mile.

We recently ordered a mattress from a leading e-tailer for our guest room. Due to some issues at the logistics service provider’s end, the delivery was delayed. We timed our order to coincide with the arrival date of our guests so we ended up complaining to customer service of the e-tailer. In addition to apologies, we ended up getting…

Importance of Scoping in a Supply Chain Modeling project

Scoping is the most critical part of a Network modeling project ,however, it is not assigned the importance it deserves when Network modeling projects are planned. There is so much focus on other phases like data collection, analysis & validation, Baseline development etc. that the importance of this critical phase is overlooked (even though it…

Challenges in Implementing an Inventory Policy

Conceptually, implementing an Inventory policy seems straightforward.  All you have to do is to categorize your products (say, using ABC Classification) and then define an Inventory Policy for  each category/class . However, in the real world, there are various challenges that you will encounter when defining Inventory policies. Before we do a deep dive into those policies, let us…

Leveraging Cost time profiles for process diagnostics and improvement

Cost Time Profiles (CTPs) can help you document and visualize the synergies of cost and time information of a process. It is a great tool for process diagnostics and improvement as it can help you identify activities that create value as well as ones that create waste. The best way to illustrate the value of…

Using Regression Analysis in Transportation Analytics- A Use Case

Recent trends indicate a surge in application of predictive analytics methodologies in the Logistics and transportation domain. Regression analysis, which is a widely used predictive analytics tool, can sometimes also be used to evaluate the key variables that are driving your transportation costs and can provide some really useful insights. Below is an example from…

Incorporating service levels in Network design

In a Network design context, service levels are usually measured by transit time or distance. So for example, if you plan to provide same day delivery, you can translate this into distance. Assuming that the max drive time will be 8 hours per day and the average speed is 50 miles per hour, the distance…

Using Greenfield Analysis for long term strategic network design

A Greenfield analysis can be a great way to get started for long term strategic network planning. A Greenfield analysis can tell you what will be the optimal locations for your Distribution network, based on your new customer demand footprint. This can help you select candidate locations for a detailed Network design exercise. Let us…

Leveraging Geographical Risk Mapping in Supply Chain Design

Supply Chain Network design exercises are sometimes so focused on achieving cost efficiencies, that they overlook a crucial aspect of Supply Chain design-factoring various risks in your Supply Chain design analysis. With Supply Chains going global, organizations sometimes need to look at multiple countries in a region( say Asia) to find the optimal location(s) for their…

Commonly used Route Optimization Scenarios: A Cheat Sheet

Route Optimization (RO) is an operational planning exercise that has the potential to generate significant cost efficiency opportunities. If you are a Transportation executive looking to leverage RO  but are not familiar with what are some of the commonly used RO scenarios, this post will give you a very brief high level understanding of four commonly used RO scenarios….

Linear and Mixed Integer Problems for Non Practitioners

As a non practitioner, you may have heard jargons like Mixed Integer programming, Integer programming etc. when interacting with your modeling team. This post intends to describe what these terms mean, in a simplified way using an example. For our example, we will use the scenario shown in the diagram below. There are two plants…

Modeling Bracket Pricing

Many commercial Supply Chain packages (like Llamasoft) don’t  allow you to define different price for the same product. If you are developing a model to capture bracket pricing, you can use the Transportation policies table to define the bracket prices. Let us take a simplified example where you have a supplier and a customer (You). The…

Incorporating Safety Stock Decisions in Supply Chain Network Models

We know that single period Strategic Supply Chain Network models are kind of snapshots whereas Inventory decisions have dynamic effects which make it challenging to capture inventory planning phenomenon within a single period Network model. Even if the model is a multi-period model, the length of the periods will be long enough, generally a year…

A Summary of commonly used Inventory policies

Defining an Inventory policy has become a strategic exercise in today’s competitive landscape. Organizations have plethora of product mixes these days which tend to make the process of defining inventory policies make complex. However, at a very high level, there are four types of Inventory policies that are widely used. While I intend to write a separate post on…