I interviewed Jerry Bendiner who discussed Solving Supply Chain Problems with Planning and Optimization Tools.
...Looking forward to discussing with you Solving Supply Chain Problems with Planning and Optimization Tools. Before we start, can you provide a brief background of yourself and your company?
Sure. Good morning, Dustin.
Technologix is based in Toronto, Canada. We also have offices in Mexico, Colombia, and Argentina. We've been developing planning and optimization solutions for over 25 years, since the early 1990s. I am one of the founding partners in the firm, and it is a relatively small and very stable organization. We are basically a boutique firm that specializes in helping people solve problems that are too complex or too specific for out-of-the-box software solutions.
That is our strength - developing tailored solutions that focus on complex and unique planning and optimization problems.
Thanks. Can you explain a bit more about what type of supply chain problems fall under your planning and optimization umbrella?
Sure - Planning and optimization tools focus on suggesting ways to utilize resources more efficiently or effectively. So we model and optimize any supply chain headache or problem that is aiming to optimize the use of limited resources such as equipment, space, people, time, inventory, transportation units, capacity, or a combination of them.
We have worked on a very wide range of topics, such as very strategic supply chain network designs, tactical planning and S&OP solutions and day-to-day operational issues, such as the routing of cargo vessels and the optimization of plant to depots replenishment processes.
The topics may vary quite a bit, but the common denominator to all of them is the challenge to find a way to utilize resources better and cost effectively.
So you mentioned that one of your clients has been running your system for 25 years. What are the keys to success of a supply chain planning and optimization system?
The client is a chemical company in Canada. They're one of the larger suppliers and distributors of sulfuric acid in North America. Back in 1991 we implemented one of our first supply chain optimization solutions using Opti-netTM, our supply chain planning and optimization development platform. They're still running the application, in it's 8th or 9th generation.
If I use them as a good example, I see three key success factors.
The first one is the ability of the tool or the solution to generate good quality results, results that are valid and also cost effective. That would be number one in my mind. If the tool is unable to produce good quality results in a consistent basis, it really won’t matter how technologically advanced the application is, how smooth the interface, how colorful the graphs, or how powerful the analytics.
Number two is to make life easier, not more complicated, for its users. Going back to the first point, let's say the system generates good quality results, but the user needs 10 hours to massage and manipulate data and then build, run and analyze a new scenario. No matter how good the solution, it's not going to succeed, because the user doesn't have that much time to spend.
The challenge then is not only to generate good quality results, but to do so quickly. The way to accomplish this is by “surrounding” the model that actually generates the good quality solutions with the logic and interface required so that users can build, solve and analyze scenarios quickly and effectively.
The third element that I think is critical in all these type of projects is the ability of the application to adapt to two types of changes – during the project and once the app is fully implemented.
No matter how careful you are scoping these ‘monsters’, planning optimization projects are complex, and it's unrealistic to expect your clients to know or define exactly what they're looking for upfront. So typically you will define the scope and develop the application and the end product is going to be, probably, 70% of what you originally envisioned and the remaining 30% are adjustments that are incorporated during the development and implementation — things that we missed, restrictions or rules that were misinterpreted, new graphs, new charts, etc. The tool has to allow the users to incorporate change and adapt.
Once the app is up and running after two, three, four, 10 years, it also has to be able to allow client organizations to incorporate changes — new rules, new restrictions, new plans, new tendencies, etc. —and do it efficiently. I relate back to the second point above - making life easier for users.
Generating good quality results, simplifying life and adapting to change – these are the key elements of a successful supply chain planning and optimization implementation. There are obviously other very important factors, but to me these are the main ones.
And if there's one piece of advice that you could offer organizations that are considering a planning and optimization system project, what would it be?
Get the foundation of the building right!
When you are planning a new house, a new building – if the foundation is not right you will end up with problems. The same applies to these, and for that matter any type of planning and optimization system implementation. Get the foundation right – make sure the purpose and scope of the new app are well defined. That will determine the modeling, functionality, logic and features required for the new app to succeed.
When an organization is interested in planning and optimization solutions, we will always recommend starting with a workshop to define scope, needs, must haves and nice to have features before exploring any technological option.
A few weeks ago a LinkedIn colleague posted a question in the Supply Chain Optimization group, asking for recommendations of a good supply chain optimization software package. As expected, within hours, two dozen vendors were proposing their application as being the best for A, B, C, or D reasons. One group participant, though, had the right answer. In fact he replied with a question, asking our colleague what he actually meant by ;supply chain optimization’, and what were the questions he was actually looking to answer with the software package he was looking for. His message was - only after you define what you want you can start looking for the right tool to help you get there. I couldn’t agree more.
If there is one piece of advise for organizations that are considering a planning and optimization system project it would be to take the time to get the scope right.
Thanks, Jerry for sharing today.
You're very welcome, Dustin. It was a pleasure talking to you.
About Jerry Bendiner
Partner & Solver of Planning Puzzles @ Technologix Decision Sciences Inc.