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A major industrial manufacturer is able to quantify the value of strategic supply chain initiatives and determine the best timeline for implementation
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Business impact Allowed the client to make informed decisions more quickly using scenario modeling to evaluate supply chain initiatives.
Issue The company needed to fulfill orders for products and services faster than its competition. In order to do this, it needed to improve collaboration with partners throughout its supply chain. The challenge was to determine which set of initiatives would deliver the most impact.
Executive summary IBM used solution scenarios that helped the client assess and prioritize initiatives based on the value of their impact in delivering a more collaborative supply chain.
What IBM did This manufacturer was thinking about consolidating supply chain improvement efforts worldwide, so IBM helped prioritize the initiatives and developed a plan for rolling them out with a schedule based on the expected impact.
An IBM Global Business Services team investigated the company's operations and developed initiatives that would support a more collaborative environment. Understanding what each initiative would do for the business and how the combination of initiatives was likely to affect the potential value to the company, were crucial in developing the plan. IBM used its Business Value Modeling Tool (BVMT) to:
- Tie implementation to business strategy
- Link supply chain investment to business value
- Provide a quantitative framework for prioritizing initiatives
Working together, IBM consultants and researchers developed the financial and operational data needed to run the analysis. Initiatives were combined into 'what-if' scenarios, which were rapidly assessed against key performance indicators.
The analysis showed that four key initiatives - Source of Supply Time Management, Forecast Accuracy Improvement, Global Master Planning, and Global Order Management - should significantly improve financial and operational performance. IBM then developed a plan to help make the company's entire supply chain far more collaborative.
Capabilities applied IBM Research's expertise in value analysis is based on years of theoretical development and numerous patents have been issued for their work. In the case of the Business Value Modeling Tool, IBM Research's experience was combined with insight from IBM Global Business Services to create a tool that considers operational improvements as well as financial metrics to give an end-to-end view of the supply chain.
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