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Three Key Themes in the New Inventory Optimization Vendor Ranking

Posted by Jeff Bodenstab on Mar 20, 2018 1:16:00 PM

2018 Inventory Optimization Technology Value Matrix - ToolsGroup.jpg

The 2018 Nucleus Research Inventory Optimization (IO) Value Matrix Report has just been released, and analyst Seth Lippincott identifies the latest technology trends, top inventory optimization solution providers, and the strengths and weaknesses of each vendor.

Nucleus positioned 17 vendors in its Value Matrix by analyzing end-user experiences relating to software usability and functionality. The matrix is divided into quadrants: Leaders, Experts, Facilitators, and Core Providers. The companies analyzed, in alphabetical order, are: 4R Systems, Blue Ridge, E2open, GAINSystems, Infor, JDA Software, Kinaxis, Llamasoft, Logility, Manhattan Associates, One Network, Oracle, SAP, Slimstock, Smart Software, ToolsGroup, and Vanguard.

Three key themes stand out in this year’s report, particularly among vendors designated as “Leaders”, those vendors that Nucleus Research rates as most likely to deliver the greatest potential return on investment to their customers

The first theme is cutting planner workload by moving toward more automated and even autonomous inventory optimization. “Leading vendors have customers that are automating parts of their inventory optimization efforts, leaving their software to set and manage stocking levels,” Nucleus says. Customers are “expecting solutions which enable them to achieve that while addressing only the exceptions to exceptions and requiring less heavy lifting to get up and running.”

Nucleus says that while full automation is not yet the norm, some vendors are enabling users to set their desired inventory and service policies and then let the software determine the optimal path forward with no human intervention. They say that "customers have left parts of their supply chain running autonomously for months at a time, optimizing inventory targets.”

The second theme is connectivity across enterprises and multi-enterprise collaboration for sensing demand and incorporating downstream data into inventory planning targets. They say, “Inventory optimization vendors are continuing to look for ways to connect their planning tools more closely with point-of-sale (POS) data and other demand signals to make their solutions more responsive and enable customers to operate in real-time. Even in scenarios where lead times are weeks or months, improving forecast accuracy into the future allows suppliers to have a better idea of what demand will be and plan accordingly, reducing risk to the buyer.”

The third theme is machine learning (ML). While still in limited use, Nucleus says that “supply chain vendors are deploying capabilities that use pattern recognizing algorithms to look for outliers and anomalies and analyze the baseline assumptions and policies established by the planner.”

Overall Nucleus says that the core business performance improvement offered by multi-echelon inventory optimization (MEIO) is still about minimizing inventory across the value chain while maintaining or increasing service levels for customers. But they say leading vendors are looking beyond the mathematical calculations and focusing on delivering additional value via flexibility and automation.  They say that these capabilities surrounding the inventory optimization engine enable a more holistic view of inventory in the supply chain network.


 Click below for your copy of the full Inventory Optimization Value Matrix.
2018 Nucleus Research Value Matrix

 

Topics: Inventory Optimization

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