This week, SAP announced the launch of its new solution, the SAP Integrated Business Planning application for demand-driven replenishment. Designed in partnership with Camelot ITLab, the application helps users compensate supply chain variability, compress lead times and reduce inventories.
“SAP continues to deliver digital supply chain portfolio innovations that simplify how our customers run their organizations,” said Franz Hero, senior vice president, SAP Supply Chain and Logistics Development. “This latest offering incorporates industry-proven methodologies to help companies address the challenges of increasingly volatile business landscapes and gain immediate improvements in business operations.”
The principal methodology behind the Integrated Business Planning application is that of demand-driven material requirements planning (DDMRP), which is used to model, plan and manage supply chains, and protect and promote the flow of relevant information and materials.
The DDMRP approach allows users of SAP’s solution to Dampen the effect of demand and supply variation on the supply chain by calculating inventory buffers and assigning and managing those buffers at strategic decoupling points; drive replenishment at strategic decoupling points from actual demand; and achieve visibility and demand-driven prioritization of supply based on buffer status at decoupling points.