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Bausch & Lomb Inc. is in the midst of a supply-chain overhaul in an effort to cut inventory, reduce planning cycles, sharpen visibility into its demand, and boost customer service.
To that end, the eye-care company is using supply-chain planning software from Manugistics Group Inc. to help it determine optimum safety stocks, implement automated replenishment processes, and improve sales forecasts. It just finished rolling out the Manugistics software to its Lens and Lens Care businesses and is now turning its attention to its surgical and pharmaceutical divisions.
Bausch & Lomb began the initiative in 1999 by creating a Global Supply Chain business unit and re-establishing an executive steering committee to oversee the initiative. It wanted to create common supply-chain processes across the $1.8 billion company; it also wanted to standardize on one supply-chain software suite.
Bausch & Lomb started with Manugistics' software to help calculate more-accurate forecasts for each stock-keeping unit. With better forecasts, the company has been able to cut inventory levels and safety stock at some of its distribution centers by as much as 30%.
"Getting the right forecast target was really the first step in getting to automatic replenishment," said Robert Hufland, Bausch & Lomb's director of global demand and fulfillment programs. Hufland detailed the company's supply-chain initiative at Manugistics' annual user conference this week in Washington, D.C.
The auto-replenishment processes are replacing inconsistent methods of moving products to distribution centers via faxes, E-mail, and phone. Now Bausch & Lomb electronically pushes replenishment orders based on forecasts, safety stock, and shipping lead times to distribution-center managers, who then have several days to review and modify them before approving.
Once approved, the orders are automatically sent to the plants. Now the replenishment process takes into account on-hand inventory, open orders, and in-transit shipments, too. "It's just been a great thing," Hufland said.
Also at the conference, Manugistics announced availability of its Swarm architecture, a new Java-based platform that lets companies distribute supply-chain-planning processes across multiple computer systems to optimize performance and scalability. That way, companies can compress planning cycles to more rapidly respond to events, the company said.
The software maker also rolled out updated versions of its applications that can leverage data polled from radio-frequency identification tags.