Whitepaper: Inventory Optimisation - the science behind growing profit, ROA and customer service levels
The Boston Consulting Group (BCG), an internationally recognized leader in business strategy and operational policy consulting, recently published an analysis of the growth in U.S. market volatility, for 5 major industries, over the past 50 years. (Harvard Business Review, July 2011).
In all industries the study shows that market volatility has increased and continues to do so. The study’s authors, both managing partners at BCG, imply that the forecasting and planning tools which “market leader” companies are currently using will not be able to keep up with this growing market volatility. They suggest that new tools are needed, tools that provide a higher degree of accuracy and the ability to sense market behaviour before that changing behaviour has the ability to negatively impact a company’s revenue.
Think of such tools as having the ability to sense heat before it gets to the point of combustion. Being able to dynamically sense demand or supply change before that change “combusts” into a major problem that consumes resources, cash, market share, and, if prolonged, company viability.
In all industries the study shows that market volatility has increased and continues to do so. The study’s authors, both managing partners at BCG, imply that the forecasting and planning tools which “market leader” companies are currently using will not be able to keep up with this growing market volatility. They suggest that new tools are needed, tools that provide a higher degree of accuracy and the ability to sense market behaviour before that changing behaviour has the ability to negatively impact a company’s revenue.
Think of such tools as having the ability to sense heat before it gets to the point of combustion. Being able to dynamically sense demand or supply change before that change “combusts” into a major problem that consumes resources, cash, market share, and, if prolonged, company viability.
| inventory_optimisation_the_science_behind_profits.pdf |