Could Quest for Working Capital Cripple Your Supply Chain?

Slashing Inventory May Leave Companies Unprepared for Upturn

BOSTON, May 18 /PRNewswire/ -- In the face of today's unprecedented credit
crunch and volatile economic environment, companies must do everything they
can to free up working capital. Optiant, the premier provider of inventory
optimization solutions, finds that many leading-edge organizations can look
within their supply chain operations to find working capital, even if lean
initiatives have been put in place.

"If management mandates lowering operating costs, running leaner, streamlining
operations, reducing workforces, and canceling projects, companies can still
find cash within their supply chain operations," says Fred Lizza, CEO of
Optiant, Inc.

According to a report by Deloitte Consulting, companies can squeeze working
capital from their supply chain. Their recommendations include focusing on
inventory reduction, cash-to-cash conversion cycles, and supply chain risk.

-- Focus on the cash-to-cash conversion cycle
-- Consider alternate supply chain financing options
-- Ensure you have a robust framework for managing supply chain risk
-- Focus on inventory reduction
-- Extend payables, intelligently
-- Manage and expedite receivables
-- Audit payables and receivables transactions
-- Eliminate fixed costs
-- Think beyond your four walls
-- Think like a CFO

For many companies, inventory levels are driven more by customer service
requirements and operational capabilities than by financial constraints.
However, in today's credit crunch, supply chain managers may be faced with the
reverse scenario, where working capital is the primary constraint on
inventory. Management's answer may be to reduce inventory for finished goods
and raw materials, but these cuts may have an adverse effect on customer
service.

"The best solution is to take a holistic approach rather than brute-force
inventory reduction," said Lizza. "Strategically adjust safety stock policies,
rationalize SKUs, revisit your sourcing plan, quantify your supply and demand
uncertainty, and consider postponement strategies. All of these moves can
reduce lead times, lower costs, and improve your competitiveness in the long
term. This positions your company for growth as the economic climate
improves."

Optiant's PowerChain(R) allows companies to find more working capital within
their supply chains by:
-- Thinking globally across the enterprise to reduce inventory while
improving service level performance.
-- Using optimization technology to model and "dollarize" the
entire, multi-echelon supply chain, rather than focusing on each stage
of the supply chain in isolation.
-- Making informed strategy and policy decisions that:
-- Minimize ripple effects, inventory holding costs, and lead times
-- Mitigate supply and demand uncertainty
-- Optimize inventory throughout product cycles, from launch to
end-of-life
-- Anticipate seasonality and one-off demand fluctuations
-- Achieve any desired customer service level
-- Reduce time-to-market to meet business goals

Using PowerChain technology, companies can avoid "silo decisions" by
simultaneously evaluating initiatives across the entire supply chain
(everything from sourcing parts from a shorter-lead-time supplier to improving
the forecast accuracy of demand in a particular region). They can evaluate
multiple alternatives using "what if" sensitivity analysis to find the
solution that best achieves key business goals.

In addition to identifying sources of inventory and gaining immediate savings
through strategic inventory placement, PowerChain helps:

-- Streamline the product planning process, eliminating constant fire
drills and expediting costs.
-- Automate demand profiling by calculating the demand parameters, at the
correct level of granularity, to use for inventory target
optimization.
-- Mitigate the bullwhip effect with precise inventory targets by SKU by
location by period.
-- Provide powerful decision-support metrics and reports that deliver
critical metrics to S&OP teams.
-- Create efficient flexibility to handle seasonality, new product
introductions, end-of-life transitions, and more.

-- Prioritize strategic initiatives relative to corporate goals for
profitability.

About Optiant
Optiant, a premier provider of supply chain network design, inventory
optimization, and supply chain business intelligence solutions, helps Global
2000 companies optimize bottom-line performance by reducing inventories,
freeing up working capital, optimizing supply chain asset utilization and
delivering lowest total supply chain costs.

Optiant's solutions optimally balance resources, total costs, and customer
service across the entire, extended supply chain to deliver greater
profitability, increased customer satisfaction, more efficient use of capital,
and a resilient supply chain that fully handles uncertainty in supply and
demand. Optiant has transformed supply chains for the world's leading
manufacturers including Procter & Gamble, Kraft, HP, IKEA, Intel, Microsoft
and Boston Scientific.

Delivering millions of dollars in returns, Optiant's solutions for consumer
product, high tech manufacturing and industrial organizations generate
quantifiable savings within 90 days of implementation. Optiant's solutions,
certified for integration by SAP, are based on award-winning research from MIT
and decades of experience dedicated to the identification and realization of
supply chain efficiencies. For more information, please visit
http://www.optiant.com.

Optiant, the Optiant logo, and PowerChain are registered trademarks of
Optiant, Inc. All other product and service names mentioned are the trademarks
of their respective companies.

CONTACT: John Brewer
+1 781 238 4165
john [dot] brewer [at] optiant [dot] com

Becky Boyd
MediaFirst PR - Atlanta
+1 770 642 2080 x 214
becky@mediafirst.net

SOURCE Optiant

John Brewer of Optiant, +1-781-238-4165, john [dot] brewer [at] optiant [dot]
com, or Becky Boyd of MediaFirst PR - Atlanta, for Optiant, +1-770-642-2080
ext. 214, becky@mediafirst.net