Supply Chain science and tech

BACK TO LOKAD TV

Jan 30, 2019

POCs (Proofs Of Concept) Don’t Work For Supply Chains

Supply chains are complex systems made of many moving parts: goods, people, machines. POCs (Proofs of Concept) routinely fail when attempting Quantitative Supply Chain initiatives because problems get displaced instead of getting solved.

Jan 24, 2019

Why You Should Subscribe to LokadTV

Keep up with the latest changes in the Supply Chain industry.

Jan 16, 2019

Terabyte Scalability for Supply Chains

The relevant amount of historical data when considering large supply chains frequently exceeds one terabyte. As a result, inventory control requires two distinct flavors of software: transactional software (e.g. an ERP) to manage the resources, and predictive software (e.g. Lokad) to optimize the resources.

Jan 9, 2019

Why Safety Stock Is Unsafe

Safety stocks are an inventory optimization method that enforces an extra quantity of stock beyond the expected demand in order to maintain a target service level. This method relies on key statistical assumptions about the demand forecast, most notably that the error is normally found in the distribution.

Dec 12, 2018

Generations of Machine Learning

Machine learning is an umbrella term that includes diverse algorithmic approaches. In supply chain, the historical way of doing machine learning was time-series forecasting. However, this approach has been superseded by a series of superior forecasting approaches.

Nov 21, 2018

Why Lead Times Are Nearly Always Underappreciated

The lead time is the total amount of time, typically counted in days, associated with the inventory replenishment cycle. The amount of stocks that a supply chain needs to operate tends to be roughly proportional to its lead times. Accurately estimating future lead times is critical for accurately estimating the amount of inventory needed to fulfill future demand. However, it is a fundamental factor that is often overlooked by companies, with a far greater importance being placed on forecasting.

Nov 14, 2018

Service Level vs. Fill Rate

In supply chain, the service level defines the probability of not hitting a stock-out during the next ordering cycle. However, the fill rate defines the fraction of the customer demand that will be properly served. Service levels and fill rates are distinct, and should not be confused.

Nov 8, 2018

The Min/Max Inventory Method Doesn’t Work

The Min/Max inventory method defines two stock levels: first, a replenishment threshold, referred to as the 'min', and second, a replenishment target, referred to as the 'max'. Yet, despite its popularity, this method is not suitable for most modern supply chains.

Oct 3, 2018

Is Forecasting High Growth Possible?

Growth, and more generally trends, needs to be taken into account in order to deliver accurate demand forecasts. However, growth; as a statistical pattern, proves to be more difficult and more elusive to capture than other well-known patterns such as seasonality.

Sep 19, 2018

How To Forecast Seasonality

Seasonality is one of the major cyclical patterns that can be used to improve forecasting accuracy. Most supply chain processes tend to be seasonal to some degree. Not only because of demand, but also lead times.

Sep 12, 2018

ABC Analysis does not work

The ABC analysis is a widespread inventory categorization method used in many supply chains. Its intent is to prioritize management's attention to where it matters most. Yet, this method has many flaws, and can no longer be considered as state-of-the-art.

Sep 5, 2018

Modularisation in Supply Chain

While the physical infrastructure supporting most supply chains is highly modular, their software infrastructure counterpart, e.g. inventory control or demand forecasting systems, tends to be monolithic and brittle. As a result, large scale software supply chain failures are still ongoing.