As businesses expand globally and diversify their products and services,
The supply chain processes can get increasingly complex. To meet the evolving customer expectations that comes with growth, supply chain stakeholders are required to prepare for challenges in planning and execution. A paradigm of efficiency, IBP is designed to improve efficiency, accuracy, and speed of accumulating, organizing, and analysing significantly large amounts of data with ease. This allows for organizations to effectively fulfil a customer’s future demands.
SAP IBP, to make the most out of it, can be split into 5 individual components, each of which has different functional capabilities to tackle different elements of supply chain management. These five components can be broken down into:
S&OP
S&OP can be considered as the core of IBP and takes inventory and product mix into consideration for supply and demand planning. This core adjusts short- to long-term strategic plans to achieve financial goals and support business growth, maintaining target service levels and profitability.
INVENTORY OPTMIZATION
This component sets forward-looking inventory targets across complex supply chains. Integrated with real-time data, you’ll know where your products are in the supply chain at any point in time. Furthermore, this component identifies inventory drivers and comes packed with inventory optimization tools so that you always have just the right amount of inventory.
DEMAND PLANNING
The Demand Sensing planning engine automatically detects changes in demand and responds appropriately and can be used in short-term statistical forecasting daily for up to 12 weeks. This module consists of traditional Demand forecasting capabilities to generate midterm to long term forecast. This module uses time series modelling to analyse historical data, while taking trends into account. Furthermore, it improves accuracy and efficiency by integrating with SAP S/4 in real time to bring in transactional data and, generate alerts if demand targets are not met.
RESPONSE AND SUPPLY
The Response and Supply component allows you to create operational supply chains within capacity and material constraints, while allowing you to perform a what-if analysis plan that accommodates the uncertainty. This component allows you to make fast adaptations to the full supply chain model or simulate production, distribution, and procurement plans without any constraints.
CONTROL TOWER
The Control Tower encompasses analytic tools that enable rapid and informed decision making to any problems in the supply chain. Data is available beyond organizational boundaries, allowing for a consistent view of the supply chain for all stakeholders.
SAP IBP provides valuable insight into both demand and supply that enable organizations to better manage their supply chain. Uncertainty in demand and supply can present challenges for effectively meeting customer expectations, and SAP IBP can prove to be a highly effective supply chain solution in providing a plethora of advantages such as speed, accuracy, and opportunities to expand collaboration.
SPEED
Quickly meet the expectations of your customers and market changes with predictions patterns. Machine learning algorithms and automation help respond to changes by quickly noticing events outside of the norm, providing what-if simulations and analytics-based alerts. This real-time solution allows businesses to react with agility and speed that keeps supply chains efficient and moving.
ACCURACY
With SAP IBP, predictability can be easily achieved. Advanced analytics and machine learning algorithms can help with strategic operations across product. The optimized planning this allows, enables for organizations to tackles issues pertaining to inventory management and supply-demand, keeping customers satisfied by meeting their expectations.
COLLABORATION
SAP IBP enables collaboration and visibility, helping businesses work with suppliers and manufacturers more easily. This solution helps organizations align on deliveries, commitments, and priorities through process orchestration. Analytics help with decision making, and inventory target setting helps keep on track towards targets within budgets. Visibility into work in progress, shipments, and availability keep disruption to a minimum with real-time information, even providing a news feed for social collaboration and communication among components.
SAP IBP can achieve demand profitably with real-time supply chain management. Powered by SAP HANA, this cloud-based solution can combine capabilities for sales and operations; demand, response, and supply planning; and inventory optimization to support of your company’s integrated business strategy with ease. An IBP implementation however, is best achieved when a considerable amount of time is spent to understand the nuances of your business to build custom solutions. We at Stellium, can help you effectively implement IBP solutions that ensures that you’ve made the most out of your investment.
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