Demand variation, supply chain responsiveness, and unpredictable events require a smart end-to-end supply chain control to ensure operations performance and fast reaction to disruptive events.
Companies are demanding agility, and sedApta is responding by offering the tools to efficiently solve customer problems by bridging the gap between planning and execution, harmonizing the different phases and actors involved in the value chain, providing the levers that can transform global visibility over supply chain processes into useful actions to achieve real competitive advantage.
We often talk about productivity in business without referring to a clear definition of it. When is an action truly productive and when it’s not? An effective definition to distinguish between productive and non-productive actions is provided by the Theory of Constraints, according to which an action is productive when it brings the company closer to its goal.
Now and in the future, the goal of companies is to generate profits and value in a sustainable way, and to evaluate the productivity of plans and decisions, it is necessary to use financial metrics in order to support managers in decision-making processes.
In order to make the right business decisions, three necessary conditions must be met:
- Define and share the business goal with all the key figures;
- Define a set of metrics that are consistent with the business objective and, at the same time, in harmony with each other to avoid the local dominance of optimization logic over the overall objective;
- Focus the company’s resources on the initiatives that create the most value. For this purpose, it becomes imperative to have process, technological and methodological capabilities to evaluate the effect of decisions in relation to the objective.
Managers are increasingly being asked to implement operational plans while taking into consideration the impacts they will have on the company’s income statement. How?
- In a prompt way, as the time lag between the problem solving and decision-making phases has shortened considerably, considering the increasingly rapid response needs
- Efficiently, maintaining cause-effect relationships between the action and the expected result
- Accurately, which does not mean going for absolute accuracy, but simply making assessments and drafting the business plan within the expected and sustainable confidence range
- In a flexible way, because reality is changing and requires frequent revisions of the corporate business plan.
By using new technologies to orchestrate the most complex processes, comparing and validating different scenarios, simulating the impacts of unpredictable or disruptive events on the entire supply chain, financial and sustainability analyses are conducted through real time post processing algorithms. With its holistic perspective, the sedApta suite ensures and facilitates collaboration between people, tools and data, in real time across the entire supply chain.
The major advantage of using these tools within business decision-making processes is that complex allocative processes that could limit the timeliness, effectiveness, and accuracy of information are not required to be performed.
The sedApta Control Tower and throughput economics metrics support managers during decision making processes through financial simulations to effectively assess the impact of their decisions, with the support of a powerful constraint-focused finite capacity engine to bridge the gap between planning and execution.
Metrics are basically used to measure what you do — profit organization you make money by selling products and services (throughput) — with the investments of purchasing goods (inventory) and resources to put production processes in place (operating expenses).
Through sedApta’s Control Tower, the user will be able to create different simulative scenarios thanks to the tools supporting the What If analyses: starting with an initial scenario, the effects of different simulation parameters on the financial metrics of throughput, inventory, and operating expenses can be analyzed, accompanied by other metrics that allow for a comprehensive analysis in all aspects related to the specific interests and compare the different scenarios to make the most beneficial decisions.