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Inventory Visibility: Availability with Certainty

Blog: Software AG Blog - Reality Check

SAG_Twitter_MEME_880x440_Know-Whats-WhereSatisfying the demands of increasingly impatient customers, many of whom require small quantities of products very quickly, causes more supply chain and logistics pressure on manufacturers than ever before. In other words, manufacturers need to know what inventory they have, no matter where it is in the supply chain; otherwise it is impossible for them to know what is where, and when.

Therefore, increasing inventory visibility will become a focal point for manufacturers in 2016, and this visibility will be enabled by the Internet of Things (IoT).

The only way for manufacturers to compete and win is to tightly integrate their supply chains, production, logistics, and customer demand shaping efforts. This requires constant visibility, in order to be aware of what is happening, along with decision-support systems to predict and respond in real time to both opportunities and threats.

Embedded IoT sensors will provide undiscovered levels of supply chain visibility, production support and customer experience optimization. The IoT will increase visibility of all inventory levels from components to materials, work-in-process, finished goods and inventory in transit.

This transparency means that manufacturers will be able to incorporate smart logistics into their supply chains. They will be better able to cope with real-time demand fulfilment, making sure that their customers get the right product, in the right quantity and at the right time.

Predictive analytics will enable them to anticipate a surge in demand for certain products, signalling where and when inventory will be needed with confidence.

Additionally, consumer-driven manufacturers will be able to incorporate real demand requirements based on end-user purchases, not just reacting to but also shaping short-term demand. This in turn will enable the resiliency to produce more on demand if required, possibly incorporating 3D printing, along with innovative postponement strategies to ensure specific products can be utilized for specific demand at the latest possible time, thereby increasing the total value of held inventory.

The efficient delivery of products is crucial to manufacturers; it only takes one “not available” message for a customer to turn to another supplier.  Smart logistics helps to provide on-the-move inventory visibility by combining real-time analysis of vendors, suppliers, environmental sensors, traffic, telematics, geopolitical risk and more to increase delivery predictability with reduced cost and risk.

This year will be the one where the jargon—Internet of Things, digital technology, supply chain, inventory visibility—comes together to enable manufacturers to zero in on their customers and provide what they want and when.


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