Supply Chain Optimization
Supply chains are complex and can involve many interdependent facilities, people, and equipment delivering products or services to multiple locations. Managing an efficient supply chain requires integrating supply and demand management by coordinating sourcing, procurement, conversion of raw materials into finished product, and logistics.
What is Supply Chain Optimization?
Supply chain optimization is a computer model of the supply chain that incorporates system interactions, resource requirements and inherent system variability to provide a realistic simulation of the supply chain. This model can be used to test, validate and optimize supply chain performance. The result is companies have a cost-effective means of making the supply chain for their goods and services more efficient. Through these models, the following can be determined:
- Impact of changing sourcing and manufacturing locations on cost, capacity, and ability to meet customer demand
- Resource requirements to meet delivery schedules
- Effect of variation in delivery times and quantities on system operation
- Impact of currency exchange rates, duty, VAT, and other costs
Effective optimization requires simulation, and that’s where Arena can help.
Arena has extensive experience helping companies improve their operations, and can easily handle the volume of information needed to measure performance and optimize the largest supply chain networks. Arena allows supply chain professionals to create models that can be tested and adjusted quickly, which lowers cost, saves time, and decreases the risk often associated with the standard trial-and-error approach.
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Challenge: determine the optimal number of business regions and which assets should be included in each.
Challenge: understanding the complex procedures in order to effectively plan batching is an intensive and time consuming task.