Supply Chain Science

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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.

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Nov 28, 2018

Data Science For Supply Chain Forecast with Nicolas Vandeput

Statistical demand forecasting was pioneered in the 20th century, however it can be revisited with better, more modern statistical approaches. Yet, these methods aren't necessarily more difficult to implement than their older counterparts, because software tooling has also significantly progressed. We are joined by Nicolas Vandeput, a Supply Chain Scientist specialized in demand forecasting and inventory optimization. We discuss his new book: 'Data Science for Supply Chain Forecast'.

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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.

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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.

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Oct 31, 2018

Transforming Complex Supply Chains with Hervé Hillion

Supply chains have to undergo profound changes to benefit from software innovations such as predictive optimization technologies. However, transforming complex, many-decade old organizations is difficult. We are joined by Hervé Hillion, one of the founding members of SAY Partners. Hervé explains how change can be effectively conducted across an entire supply chain.

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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.

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Sep 26, 2018

3PL in Global Supply Chains

3PL - or third-party logistics - represent a way for companies to externalize their warehousing, distribution and fullfillment. Often when ordering a product on Amazon or eBay for example, the merchant is not actually going to ship the product directly to you themselves and instead uses a specialized company called a 3PL who ships the product on their behalf.

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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.

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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.

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