The Ongoing Challenge – an Accurate Assessment of Supply Linked to Demand to Create an Enterprise-wide End to End Detailed Central Supply Chain Plan

Organizations can be viewed as an ongoing sequence of loosely coupled decisions where current and future assets are matched with current and future demand across the demand-supply network at different levels of granularity ranging from a placing a lot on a tool to an aggregate capacity plan across a five year horizon. Since the early 1990s detailed enterprise wide central planning has become a key member of this “decision suite.” Despite its importance, most organizations execute central planning with “limited levels of accuracy or intelligence.” Early in the evolution of “central planning engines” IBM determined that “extended accuracy” was an important component of supply chain efficiency and customer satisfaction and made a substantial investment to develop a central planning engine which could handle the scope (complexity) and scale (size) of large organizations. This paper covers the value from this investment and the technical details of combining heuristics and optimization.