Inventory Optimization Tools 2003

An overview of the vendors, developments and trends in the Dutch Inventory Optimization
market

Cap Gemini Ernst & Young

B2B Supply Chain service line
Inventory Optimization Tools 2003

An overview of the vendors, developments and trends in the Dutch Inventory

Optimization market

Utrecht, September 2002

ir. R.J.G.M. Lenders MTD

drs. ing. L.F.A. van Zundert CPIM

Cap Gemini Ernst & Young

B2B Supply Chain service line

Cap Gemini Ernst & Young Netherlands, B2B Supply Chain service line
 Contents

1 Introduction 3

2 Profile of the Inventory Optimization market space 4

2.1 Overview 4
2.2 CGE&Y’s opinion 5

3 The differences per industry 7

3.1 Overview 7
3.2 CGE&Y’s opinion 8

4 Who are the dominant players on the Dutch Inventory Optimization

market? 9
4.1 Overview 9
4.2 CGE&Y opinion 10

5 The most important developments in the last 3 years 11

5.1 Overview 11

6 The most important trends for the coming 3 years 13

6.1 Overview 13
6.2 CGE&Y opinion 14

7 Differentiators of Inventory Optimization software vendors 16

7.1 Overview 16

8 Inventory optimization functionality comparison 18

8.1 Overview 18

9 Cap Gemini Ernst & Young – Your partner in supply chain projects 21
9.1 Introduction 21
9.2 CGE&Y – The premier partner in supply chain package selections 21

10 Participating Inventory Optimization software vendors 22

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1 Introduction
This report contains an overview of the leading Inventory Optimization software vendors in the
Netherlands. It discusses the developments that have occurred in the last three years and analyses
the trends for the coming three years. It also analyses Inventory Optimization tool penetration in
different industries and discusses the differentiators in the market.

Inventory Optimization functionalities consists of all methods and functions which can be used
for efficient and effective inventory management. Inventory management has the goal of mini-
mizing inventory costs while maximizing customer service levels. Inventory Optimization tools
contain functionalities like:
• Calculation of optimal safety stock levels based on customer service level parameters
• Calculation of ABC classifications
• Determination of the best ordering methodology (including reorder points and order sizes)
• Best before date management and optimal lot size calculations
• Analysis for stock / non-stock decisions
• Dynamic safety stock level management

We have only included specialized Inventory Optimization software vendors and not the more
general ERP software vendors which also have functionality for inventory optimization.

This report is part of a series of reports published in 2002 / 2003 around different categories of
standard supply chain software packages. Reports have been published or are planned around the
following software categories:
1. Warehouse Management Systems (WMS)
2. Product Lifecycle Management (PLM)
3. Advanced Planning Systems (APS)
4. Transport Management Systems (TMS)
5. Supplier Relationship Management (SRM)
6. Manufacturing Execution Systems (MES)
7. Supply Chain Event Management (SCEM) / Visibility software

For this overview CGE&Y prepared a short questionnaire which was distributed to all Inventory
Optimization software vendors in the Dutch marketplace. The results from the overview were
consolidated and analyzed by professionals from CGE&Y. Also CGE&Y supply chain profes-
sionals have provided their input, analysis and market views for this report.

Many thanks to the Inventory Optimization software vendors who have participated in this
overview.

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2 Profile of the Inventory Optimization market space

2.1 Overview

The Inventory Optimization Tool marketplace is clearly a niche market since all software vendors
which are present on this market also deliver other software components (like Forecasting,
Supply Chain Network Design, ERP, Retail software or APS). Indeed, it is interesting to see that
all of the Inventory Optimization software vendors also deliver forecasting software which is
often closely linked to the Inventory Optimization functionalities (optimization of inventory
levels based on future forecasting data). Notable exception to this is Logic Tools which does not
deliver a forecasting tool. Logic Tools however also delivers Supply Chain Network Design
software, just like Manugistics and Tools Group (through a partnership with Radical).

For this report we consider software vendors which deliver forecasting or supply chain network
design software next to their inventory optimization tool specialized inventory optimization
vendors. Software vendors which also deliver ERP, APS or retail software will be considered
separately in this report.

The largest specialized vendor in the Netherlands in terms of number of employees is Infolog,
followed by A3 forecast solutions, Finmatica Mercia, Toolsgroup and Demand Solutions.
“Broader” software vendors are Ross Systems (which also delivers ERP software), Manugistics
(which also delivers APS software), OM Partners (which also delivers APS software) and JDA
(which also delivers Retail software). Ross Systems has formed a partnership in 2002 with
Prescient Systems (a US APS software vendor) in which Ross Systems delivers the Prescient XEi
solution as their iRenaissance SCM solution.

In the table below the Inventory Optimization software vendors are ranked according to the
number of employees in their Dutch organization.

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Number of employees
Vendor Name Package Name NL EUR WW
Infolog Slim4 15 25 35
A3 forecast solutions A3 5 25 30
Finmatica Mercia MerciaLincs 5 1000+ 1200+
Toolsgroup DPM (Distribution Planning Model) 4 42 43
Demand Solutions DS Requirements Planning 1 15 120
FuturMaster FuturMaster Planning 0 20 20
Inventory Management Associates IMA Visual Planning 0 8 10
Logic Tools Inventory Analyst 0 0 25
Wizard Information Systems Optimiser - - -
Vendors of functionalities broader than Inventory Optimization alone
Ross Systems / Prescient Systems iRenaissance SCM / Prescient XEi 40 200 450
Manugistics NetWORKS Fulfillment 16 220 1350
OM Partners OMP Supply Chain Suite 5 80 80
JDA Software Portfolio 1 300 1600
Table 1: number of employees per Inventory Optimization software vendor

If we look at the number of implementations in the Netherlands of the inventory optimization

modules then there is one clear winner: Infolog with their Slim4 solution. Infolog is followed by
A3, Finmatica Mercia and JDA (JDA bought the E3 company in 2001).

Number of implementations
Package Name NL EUR WW
Slim4 120 140 148
A3 18 56 56
MerciaLincs 8 220 350+
DPM (Distribution Planning Model) 1 145 152
IMA Visual Planning 1 55 65
FuturMaster Planning 1 10 17
Inventory Analyst 0 0 2
DS Requirements Planning - 90 1000
Optimiser - - 60
Vendors of functionalities broader than Inventory Optimization alone
Portfolio 1001 1000 4000
OMP Supply Chain Suite 36 282 304
NetWORKS Fulfillment 21 384 1490
iRenaissance SCM / Prescient XEi - - -
Table 2: number of implementations per Inventory Optimization software package
1
JDA has 4 implementations of their E3 inventory optimization tool in the Netherlands, 10 implementations of their
JDA retail solution and 90 implementations of their Intactix category / space management solution

2.2 CGE&Y’s opinion

With respect to the Inventory Optimization market space we expect the following future devel-
opments to occur:

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• The market for Inventory Optimization software will grow in the short-term;
Despite or maybe thanks to the economic downturn the inventory optimization software
market will grow because companies are focusing on reducing costs (f.e. inventory levels)
and increasing efficiency. Many companies have implemented large and expensive ERP
and APS solutions just to discover that these solutions did not help them to actually im-
prove supply chain efficiency and costs (lower inventory levels, higher delivery reliability
etcetera). With much lower costs and effort they can now implement inventory optimiza-
tion software which can actually deliver the results that were originally expected from the
massive ERP and APS implementations.
• The large ERP vendors will expand their inventory optimization (and forecasting)
functionalities;
Traditionally ERP vendors have provided limited support both for forecasting and for in-
ventory optimization functionalities. Nowadays some of the ERP vendors offer extensive
forecasting functionalities but inventory optimization functionalities are still lacking in
almost all ERP systems. Even if these functionalities are present then mostly the way of
working and user interface for these functionalities is very cumbersome. However, since
these functionalities form the basis why many companies look for new ERP systems in
the first place and since many companies are focusing right now on cost and operation ef-
ficiency we do expect that ERP vendors will start working on expansion of their fore-
casting and inventory optimization functionalities so that their customers can achieve
bottom-line benefits when deploying their systems.
• The market for inventory optimization software will disappear in the long-term;
We do believe that the main reason that there is a market for add-on inventory optimiza-
tion tools is because the ERP vendors forgot to offer decent and user-friendly functionali-
ties for both forecasting and inventory optimization. Independent software vendors have
seen this forgotten niche market and have developed inventory optimization tools for the
add-on ERP market. However, as we have concluded in our second conclusion in this
paragraph we do expect that ERP software vendors will fill this gap in the long term. At
that point the existence of these add-on tools for inventory optimization will be endan-
gered.

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3 The differences per industry

3.1 Overview

In the table below the total number of implementations per industry are mentioned for the
Inventory Optimization software vendors that participated in this overview (from those who were
willing to provide this industry-specific data). By far, the Consumer Products and Wholesale
industries are the most important industries for add-on inventory optimization tools in the
Netherlands (more than half of the implementations have taken place in these industries). Also
the Industrial Manufacturing, Retail and Food & Beverage industries have a decent number of
implementations of add-on inventory optimization tools.

In Europe also the Consumer Products, Food & Beverage, Retail and Industrial Manufacturing
industries are the most important industries for add-on inventory optimization tools. Different
from the Netherlands however, the Wholesale industry is less important in the European market-
place (the Netherlands contains a very large number of wholesale companies) while Chemicals,
Automotive, Distribution and Pharmaceuticals / Biotech are more important industries for add-on
inventory optimization tools.

DISTRIBUTION OF INVENTORY OPTIMIZATION Netherlands Europe

IMPLEMENTATIONS ACROSS INDUSTRIES
Consumer Products 90 (29%) 794 (33%)
Wholesale 67 (22%) 142 (6%)
Industrial Manufacturing 37 (12%) 275 (11%)
Food & Beverage 28 (9%) 335 (14%)
Retail 25 (8%) 241 (10%)
Chemicals 10 (3%) 149 (6%)
Automotive 10 (3%) 110 (5%)
High Tech 7 (2%) 51 (2%)
Distribution Industry 5 (2%) 115 (5%)
Pharmaceuticals / Biotech 4 (1%) 116 (5%)
Energy & Utilities 3 (1%) 11 (0%)
Engineering & Construction 2 (1%) 2 (0%)
Public Transport 0 (0%) 0 (0%)
Other Industries 20 (6%) 94 (4%)
Table 3: distribution of Inventory Optimization implementations across industries

In the table below you can see the number of implementations per package per industry. It is clear
to see that no vendor specializes in any industry but that all inventory optimization vendors
deliver their solutions to all kinds of industries.

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Inventory
A3 forecast Manu- Mgt Asso- Tools- Finmatica JDA Demand Futur- OM
INDUSTRY solutions gistics ciates group Mercia Software Solutions Master Infolog Partners
Consumer NL 16 7 2 60 4 1
Products EUR 50 71 10 1 34 600 13 4 11
NL 5 2 10 1 3 7
Food & Beverage EUR 124 8 12 44 100 12 7 3 25
NL 1 2 20 2
Retail EUR 25 2 2 200 9 3
Distribution NL 5
Industry EUR 36 26 3 50
NL 1 5 61
Wholesale EUR 7 16 50 69
NL 3
Energy & Utilities EUR 7 4
NL
Public Transport EUR
Industrial NL 3 8 26
Manufacturing EUR 18 5 5 14 11 222
NL 1 3 2 4
Automotive EUR 2 14 2 34 26 20 5 7
NL 1 1 5
High Tech EUR 1 25 5 12 8
Pharmaceuticals NL 1 1 2
/ Biotech EUR 2 25 8 48 10 10 9 4
NL 2 2 4 2
Chemicals EUR 34 2 29 30 5 9 40
Engineering & NL 2
Construction EUR 2
NL 20
Other Industries EUR 1 5 33 26 9 20
Table 4: number of implementations per Inventory Optimization tool per industry

3.2 CGE&Y’s opinion

With respect to the specific industries we expect the following future development to occur:
• The emergence of vendors which only focus on the (semi)process industry;
A common phenomenon in business applications is that when the specific application
market becomes mature that the software vendors are going to focus on specific industries
to obtain a better competitive position. In the case of the inventory optimization market
the total market is very small because the market for add-on inventory optimization tools
is still a very niche market. The only industry for which specialization would make sense
is the (semi)process industry (Food & Beverage, Chemicals, partly Consumer Products)
because this industry comprises approximately 41% of the current Dutch and 53% of the
current European inventory optimization tool marketplace. Inventory optimization tool
vendors which focus on the (semi)process industry will therefore get an increased com-
petitive position in approximately 45% of the total market (while probably neglecting the
other 55% of the total market).

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4 Who are the dominant players on the Dutch Inventory Optimization

market?

4.1 Overview

We have asked the inventory optimization software vendors for their top 3 competitors. We also
asked them which consultancies they mostly encountered during package selections and imple-
mentations in the inventory optimization market space (each vendor had the chance to name three
consultancies).

Top inventory optimization software vendors

Apparently competition in the inventory optimization market is very limited since most software
vendors did not name any competitors at all. However, Infolog, Demand Solutions, SAP, i2
Technologies and Manugistics are considered the most important players on this market closely
followed by Finmatica Mercia.

Inventory optimization software vendors Number of times mentioned as a competitor

Infolog 2
Demand Solutions 2
SAP-APO 2
I2 Technologies 2
Manugistics 2
Finmatica Mercia 1
Table 5: top competitors in the Dutch inventory optimization market space as ranked by fellow software
vendors

Consultancies involved in inventory optimization package selection

The same situation is applicable for consultancies involved in package selection projects for
inventory optimization software. Some vendors even replied that they never encountered consul-
tancies during inventory optimization tool selections. PWC seems to have some lead but is
closely followed by other leading consultancies in the supply chain field like Cap Gemini Ernst &
Young, Atos KPMG, Atos Origin, Accenture, Ordina and Deloitte. Also niche consultancy
Mobius was mentioned once.

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Consultancies involved in inventory optimization package Number of times mentioned

selection
PriceWaterhouseCoopers (PWC) 2
Cap Gemini Ernst & Young (CGE&Y) 1
Atos KPMG 1
Atos Origin 1
Accenture 1
Ordina 1
Deloitte 1
Mobius 1
Table 6: consultancies involved in inventory optimization package selection projects as ranked by software
vendors

Consultancies involved in inventory optimization package implementation

Consultancies are seemingly hardly involved in implementations of inventory optimization tools.

Only PWC, CGE&Y, Accenture and Atos Origin are sometimes encountered by the inventory
optimization tool vendors.

Consultancies involved in inventory optimization package Number of times mentioned

implementation
PriceWaterhouseCoopers (PWC) 1
Accenture 1
Cap Gemini Ernst & Young (CGE&Y) 1
Atos Origin 1
Table 7: consultancies involved in inventory optimization package implementation projects as ranked by
software vendors

4.2 CGE&Y opinion

With respect to the Dutch inventory optimization market we expect the following future devel-
opment to occur:
• Consultancies will not try to penetrate the inventory optimization tool market;
At the moment the larger consultancies are only seldom involved in inventory optimiza-
tion tool selections and implementations. We do not expect that this will change. The in-
ventory optimization tool market is a very small and niche market so it makes no sense for
the large consultancies to invest in this market. Also as we have seen in chapter 2 we ex-
pect that this market will disappear in the long term because we do expect that ERP ven-
dors will increase their functionalities for forecasting and inventory optimization in which
case separate add-on inventory optimization tools will become unnecessary.

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5 The most important developments in the last 3 years

5.1 Overview

We have asked all inventory optimization software vendors what they thought were the most
important developments during the last three years. In this paragraph we will analyze these most
important developments.

The most important developments have been:

• Vendor Managed Inventory (VMI);
VMI between pairs of trading partners seems to be the most important development in in-
ventory optimization during the last 3 years. This includes basic collaboration between the
trading partners in setting and managing service level targets and inventory targets. To
manage these targets often inventory optimization software is used.
• Service level and demand driven inventory optimization;
In many companies inventory optimization is still done on “standard” inventory algo-
rithms like the (s, Q) or (s, S) models. In the (s, Q) model an order with size Q is created
after the inventory level reaches a value below s. In the (s, S) model an order of size (S –
current inventory level) is created after the inventory level reaches a value below s. In the
last few years however many companies have switched to more advanced inventory opti-
mization algorithms like service level and demand driven inventory optimization. In
service level driven inventory optimization one can set the required service levels per
customer – article number and the system automatically optimizes inventory levels to
achieve the required service levels. In the demand driven model the system dynamically
calculates the required safety stock levels based on the future demand. In this model dy-
namic safety stock levels will result because customer demand is variable (and thus aver-
age demand and demand variability varies). These more advanced inventory optimization
models cannot be supported anymore by manual inventory management or spreadsheet-
like inventory management systems. Hence the rise of inventory optimization tools to
support these more advanced inventory optimization models.

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Developments during last 3 years Number of times mentioned

GENERAL DEVELOPMENTS WITHIN MARKET
Best-of-breed philosophy instead of wanting all functionality from one 1
vendor
Inventory has been neglected in the last few years 1
Big investments in SCM tools together with new/upgraded ERP systems 1
Focus on reduction of working capital 1
Large number of SKU’s (>100.000) from stock 1
INVENTORY OPTIMIZATION FUNCTIONALITY
Vendor Management Inventory (VMI) including basic collaboration on 3
service level / inventory targets
Service level driven inventory optimization 1
Demand driven inventory optimization 1
Collaborative planning with customers 1
Inventory management through integral supply chain network optimization 1
Management by exception 1
Bayesian analysis of historical data now allows the subjective input of 1
forecast uncertainty, allowing intervention to stock levels to be incorporated
into the statistical model without ‘expert’ mathematical knowledge
Improvements to the basic ‘Croston’ method of handling slow and sporadic 1
moving items to allow these items to be managed as part of the same
process as the ‘fast movers’
TECHNICAL DEVELOPMENTS
Internet enabled version of the software 1
Table 8: developments in inventory optimization market during the last 3 years as mentioned by software
vendors

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6 The most important trends for the coming 3 years

6.1 Overview

We have asked all inventory optimization software vendors what they thought to be the most
important trends for the coming 3 years. In this paragraph we will analyze these trends.

In general the inventory optimization software vendors feel that most trends are general devel-
opments within the supply chain market and only a limited number of trends are taking place in
the area of inventory optimization functionality. This would suggest that most inventory optimi-
zation software vendors feel that their inventory optimization software suite is very mature and
that little functional developments are necessary to further enhance their software suite. The most
important developments as mentioned by the inventory optimization software vendors are:
• Rationalization of supply chain networks;
Many companies are currently evaluating and rationalizing their supply chain networks.
The inventory optimization software vendors think that this supply chain rationalization
trend will continue for the next 3 years.
• Trend for easily implementable solutions with fast Return-On-Investment (ROI);
Large supply chain projects with long implementation times are “OUT”. The trend is on
easy solutions which can be implemented very fast and which can yield an immediate re-
turn on investment.
• Trend for inventory optimization point solutions;
Inventory optimization software vendors feel that many companies are looking for point
solutions for inventory optimization in addition to their existing ERP / financial systems.
We certainly agree with this trend in the short term but we expect that ERP systems will
expand into inventory optimization functionalities in the long term.

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Most important trends coming 3 years Number of times mentioned

GENERAL DEVELOPMENTS WITHIN MARKET
Centralization with hubs / rationalization of supply chain networks 3
Quick implementation and Return-On-Investment (ROI) required 2
Best-of-breed selection, utilizing existing ERP/financial software 2
4PL Logistics 1
Functionality and proven track record more important than latest 1
technology
Focus on customer service improvement 1
INVENTORY OPTIMIZATION FUNCTIONALITY
Collaborative Forecasting and Promotions Planning 1
Vendor managed inventory (VMI) 1
More sophisticated analysis of past events (especially product 1
launches and promotions)
Advanced probability distributions that will improve performance at 1
the extremes of demand
More sophisticated collaboration across the entire supply chain 1
looking beyond a service level of xx% and more towards a reduction
in the cost of servicing the remaining 100 minus xx% demand
TECHNICAL DEVELOPMENTS
None None
Table 9: future developments in inventory optimization market as mentioned by inventory opti-
mization software vendors

6.2 CGE&Y opinion

With respect to the future developments in the inventory optimization market we expect the
following main future developments to occur:
• Inventory optimization as a separate application category will disappear and will be-
come integrated with the forecasting application category;
Almost all inventory optimization software vendors also deliver forecasting software.
This is not surprising since inventory optimization and forecasting are closely linked (de-
termining inventory levels based on forecasting data). However not all forecasting soft-
ware vendors are also delivering inventory optimization software at the moment
(CGE&Y’s estimate is that approximately 50% of the forecasting software vendors also
deliver inventory optimization software). We do expect however that these two applica-
tion categories will integrate in the future.
• Real-time dynamic planning;
Almost all inventory optimization tools are currently used on a periodic basis. In future
supply chains CGE&Y expects that companies become adaptive players which will react
to events on a real-time basis (CGE&Y’s vision is called “The Adaptive Enterprise®” and
“The Adaptive Supply Chain®”). We therefore expect that inventory optimization tools in
the future will not be stand-alone applications which are used on a periodic basis but will
become completely integrated with the companies other supply chain applications. Since

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the customer environment can be very volatile the largest efficiency can be obtained by
decreasing the reaction time to these changing customer needs.
• Integration with supply chain event management or visibility applications;
Another application category in the supply chain area which has gained substantial trac-
tion during the last few years are supply chain event management applications (also called
visibility applications). These applications allow companies to follow their inventory
across a complete supply chain network (own facilities, during transport, at customer sites
etcetera). These applications also allow companies to react on specific events in the sup-
ply chain (f.e. because the ship that needs to arrive in harbour A is a few hours late, the
truck that is planned to pick-up the shipment at the harbour must be delayed). Because we
expect that inventory optimization tools will be required to support real-time dynamic
planning situations it will also be necessary that these applications will be integrated with
supply chain event management type applications.

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7 Differentiators of Inventory Optimization software vendors

7.1 Overview

We have asked the inventory optimization software vendors for their competitive differentiators.
The following competitive differentiators have been named by multiple inventory optimization
software vendors:
• Speed and cost of the implementation (quick return on investment);
Most vendors feel that the speed and cost of implementation (and the associated quick
return on investment) is their primary competitive differentiator.
• Ease of use;
Another competitive differentiator which is often cited is the ease of use of the applica-
tion. Many vendors have tried to develop their application in such a way that end users
can use the inventory optimization tool without extensive knowledge of the underlying
statistical and mathematical models.
• Implementation expertise;
Many vendors differentiate themselves on the expertise of their consultants in doing in-
ventory optimization projects. Since the results of inventory optimization projects are
easily measured (lower inventory levels, higher customer service levels) and since many
inventory optimization projects start with pilots to measure the actual benefits of the new
solution one can imagine that inventory optimization tool vendors indeed invest in senior
consultants which have much knowledge about inventory optimization.
• Integration between inventory management and forecasting;
Many vendors believe that the fact that their application contains both inventory manage-
ment and forecasting functionality (in an integrated way) is a competitive differentiator
against the other software vendors in this market space.

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Most important differentiators Number of times mentioned

GENERAL VENDOR ASPECTS
Speed and cost of the implementation (quick return on investment) 8
Ease of use (no extensive statistical and mathematical knowledge from 5
the end user required)
Implementation expertise 3
Depth of functionality 2
Functionality based on user requirements 2
Strong orientation on vertical market segments 1
High customer satisfaction levels 1
Filling software ‘gaps’ in current supply chain systems and providing 1
analytical tools to improve current performance
Application is used across industries 1
Highly automated and self tuning 1
After-sales support services 1
Integrated suite of applications 1
Flexible tool 1
INVENTORY OPTIMIZATION FUNCTIONALITY
Inventory management is integrated with forecasting 3
Optimization functionality 2
Configurable safety stock calculations based on a required level of 2
customer service
Service planning capability 1
Frequency based forecasting 1
Easy and quick what if scenario planning possible, enabling the user to 1
manipulate planning criteria
Determination of production policy (e.g. MTO, MTS) taking into 1
account several supply chain parameters
TECHNICAL POSSIBILITIES
Multidimensional database 1
Graphics interface 1
Reporting – both tabular and graphics 1
Table 10: competitive differentiators as mentioned by inventory optimization software vendors

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8 Inventory optimization functionality comparison

8.1 Overview

There are quite some functionality differences between the different inventory optimization tools.
Only Optimiser (from Wizard Information Systems) does not support multiple warehouses. A3
(from A3 forecast systems) does not support hierarchical distribution structures. Frequency
distribution determination and ABC analysis are also not supported by A3. Automatic determina-
tion of the best ordering methodology is the less supported functionality among the inventory
optimization tools; both A3, DS Requirements Planning (from Demand Solutions), iRenaissance
SCM (from Ross Systems / Prescient Systems) and Optimiser do not support this. What-if
scenario modeling is not supported by A3. Both best-before-date management and price breaks
are not supported by A3 and Optimiser.

Functionality 1 2 3 4 5 6 7 8 9 10 11 12 13
Support for multiple warehouses Yes Yes Yes Yes Yes Yes Yes Yes Yes No - Yes Yes
Support for hierarchical distribution No Yes Yes Yes Yes Yes Yes Yes Yes Yes - Yes Yes
structure (f.e. central warehouse
with local satellites)
Automatic determination of the No Yes Yes Yes Yes - Yes Yes Yes Yes - Yes Yes
frequency distribution based on the
historic sales pattern per article
number
ABC analysis No Yes Yes Yes Yes - Yes Yes Yes Yes - Yes Yes
Customer service level forecasts are Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes - Yes Yes
supported which optimise safety
stocks and minimize inventory
levels and carrying costs for any
level of customer service you
specify
Automatic determination of the best No Yes No Yes Yes - No Yes Yes No - Yes Yes
ordering methodology / No
Automatic generation of purchase Yes Yes Yes Yes Yes - Yes Yes Yes Yes - Yes Yes
order quantities and purchase order
dates (including pulling forward or
pushing backward existing purchase
orders)
What-if scenario modelling is No Yes Yes Yes Yes Yes Yes Yes Yes Yes - Yes Yes
supported
Support for best-before-dates No Yes Yes Yes Yes - Yes Yes Yes No - Yes Yes
management in the calculation
algorithms (considering expiry
dates)

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Functionality 1 2 3 4 5 6 7 8 9 10 11 12 13
Price breaks by item / supplier can No Yes - Yes Yes - Yes Yes Yes No - Yes Yes
be defined + used in inventory
optimization
The following constraints can be set- Yes Yes Yes - Yes Yes Yes - Yes Yes
up: No Yes Yes
- Minimum value purchase order Yes Yes Yes
- Minimum shelf quantity
Standard reports on: Yes Yes - Yes Yes - Yes Yes
- Expected height unmarketable Yes No No Yes -
articles Yes Yes Yes Yes Yes
- Inventory levels projection
Table 11: functionality comparison between inventory optimization software vendors

Nr Application name Other functionalities supported

1 A3 • Dynamic safety stock based on forecast accuracy, replenish-
ment time and desired service level
• Size break down calculation for articles in multiple sizes
2 DPM (Distribution Planning Model) • Lot size optimization
• Management of supplier reliability factors
• Rough Cut Capacity Planning
• Primary Transportation Planning
3 DS Requirements Planning • Performance summary with ABC classification for quick and
easy what if comparisons
• Supports BOM (kits etc.) up to 99 levels
• Export functionality, all data can be exported easily
• Ability to set inventory logic by ABC classification
• Plan safety stock, safety time or combination per item/vendor
• Level orders by weight, units, volume
• Identify items requiring action as a result of deviation from
planned tolerances
4 FuturMaster Planning
5 IMA Visual Planning
6 Inventory Analyst • Ability to determine optimal committed service time
• Ability to determine works for consolidation and assembly
7 iRenaissance SCM
8 MerciaLincs • Comprehensive reporting and analysis to identify and control
both under-stocked and over-stocked items
• Support for S&OP process to monitor inventory and service
performance against plan
• Stock/Non-stock analysis
• Evaluation of alternate resource to service customer demand
(for example – is it cheaper to occasionally rush items by pre-
mium freight than to hold higher stocks locally?)
• Support to collaboratively interact with inventory levels with
supply chain partners via the internet
• Inventory rebalancing (is there too much inventory in one lo-
cation and a potential shortage in another?)
9 NetWORKS Fulfillment • Customer specific statistical safety stock algorithms
• Safety stock templates

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• Seasonal safety stock building

10 Optimiser • Capacity and load consolidation
11 Portfolio
12 Slim4 •
Management by exception based on urgency
•
Expedite and de-expedites of existing orders
•
Supporting stock/non stock management
•
Reporting on risk for obsolescence
•
Check order book versus forecast and availability
•
Special functionality to support for super slow moving items
and spare parts
13 OMP Supply Chain Suite • Define the most suitable product policy (make to order – make
to stock)
Table 12: legend for table 11 and list of other supported functionalities

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9 Cap Gemini Ernst & Young – Your partner in supply chain projects

9.1 Introduction

Cap Gemini Ernst & Young (CGE&Y) is the largest management consultancy in the Benelux,
Europe and worldwide. Within our worldwide organization we recognize the service line B2B
Supply Chain Management which contains the following service offerings:
• Sourcing and eProcurement
• Manufacturing and Operations
• Logistics and eFulfillment
• Supply Chain Strategy
• Demand and Supply Planning
• Product Lifecycle Management
• Asset Lifecycle Management
• B2B Marketplaces

9.2 CGE&Y – The premier partner in supply chain package selections

Our package selection consultants all have multi-year experience with package selection projects.
They know the supply chain software market and know the main differentiators of each vendor.

All our package selection consultants use our award-winning ERNIE software selection tool. This
tool contains, among others, a detailed database on all the vendors present on the Dutch (and
European) market within specific software categories. We have ranked these vendors against
detailed critical functional requirements lists which we have developed based on our worldwide
experiences with package selections in these software categories.

For information regarding our package selection services and our supply chain services please
contact CGE&Y on +31 (0)30 689 8845 or through e-mail on
Logistiek&Informatiesystemen@cgey.nl.

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10 Participating Inventory Optimization software vendors

Company name A3 forecast solutions B.V.

Address Postbus 98
Postal code and city 3640 AB MIJDRECHT
Contact person Mr. Z. de Baat
Application name A3
Version number 3.1

Company name Demand Solutions (Europe)

Address Rippingstraat 2
Postal code and city 2651 EZ BERKEL EN RODENRIJS
Contact person Mr. R. van der Heiden
Application name DS Requirements Planning
Version number DSRP 8.4

Company name Finmatica Mercia

Address Siriusdreef 17-27
Postal code and city 2132 WT HOOFDDORP
Contact person Mr. S. Tonks
Application name MerciaLincs

Company name FuturMaster

Address 257 avenue Le Jour se Lève
Postal code and city 92100 BOULOGNE – FRANCE
Contact person Mr. J.R. Gard
Application name FuturMaster Planning
Version number 4.50

Company name InfoLog Benelux B.V.

Address Keulenstraat 8D
Postal code and city 7418 ET DEVENTER
Contact person Mr. E. van Dijk
Application name Slim4
Version number 3.1

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Company name Inventory Management Associates Limited

Address Peachey House Bepton Rd
Postal code and city GU28 0JS MIDHURST W SUSSEX - UK
Contact person Mr. T. Dear
Application name IMA Visual Planning
Version number 3.8

Company name JDA Software

Address Churchill Court, Hortons Way
Postal code and city TN16 1BT WESTERHAM, KENT - UK
Contact person Mr. P. Carter
Application name Portfolio
Version number 2003.1

Company name LogicTools Inc.

Address 35 Corporate Drive 4th floor
Postal code and city MA 01803 BURLINGTON - USA
Contact person Mrs. E. Simchi-Levi
Application name Inventory Analyst
Version number 1.0

Company name Manugistics

Address Marcel Thirylaan 79
Postal code and city B-1200 BRUSSELS – BELGIUM
Contact person Mr. R. van Delden / Mrs. A. Roelandts
Application name NetWORKS Fulfillment
Version number Version 7

Company name OM Partners N.V.

Address Michielssendreef 39-48
Postal code and city B – 2930 BRASSCHAAT – BELGIUM
Contact person Mr. W. Blondeel
Application name OMP Supply Chain Suite
Version number Version 4

Company name Ross Systems Nederland B.V.

Address Postbus 2817
Postal code and city 3500 GV UTRECHT
Contact person Mr. J. Steenbakkers
Application name iRenaissance SCM
Version number Version 4.50

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Company name Toolsgroup

Address Weesperstraat 118
Postal code and city 1112 AP DIEMEN
Contact person Mr. P. Kelly / Mr. R. Wallis
Application name DPM (Distribution Planning Model)
Version number Version 4.1

Company name Wizard Information Systems B.V.

Address Pioenroosstraat 26
Postal code and city 5241 AB ROSMALEN
Contact person Mrs. G. Marques
Application name Optimiser
Version number 1.62

Cap Gemini Ernst & Young Netherlands, B2B Supply Chain service line