Context

The ability to granularly forecast demand is a fundamental business lever for manufacturers with complex and highly customizable offers. With the possibility of many different inventory stocking combinations, aligning production planning with customer demand is a critical commercial challenge that requires deep, ongoing customer insight. Addressing this challenge by matching production planning to customer needs (configuration patterns) reflects a significant opportunity for revenue and profitability improvements.

Once a manufacturer knows what customers want…

Revenue Solution

Oliver Wyman’s platform uses advanced statistical methods and customer analytics to achieve substantial optimization of the offering and the configuration of the offering – significantly boosting unit profitability. Our automated solution provides market-level and site-level offering and inventory recommendations, along with accompanying processes, to ensure that demand opportunities are fully captured.

Impact

When deploying this solution, Oliver Wyman has demonstrated average increases in client revenue of 5-15 percent per optimized unit, with an additional reduction in unit discounts by 2-3 percent. This solution has also generated improvements in inventory turnover between 10-20 percent, positively affecting stocking costs. The automated solution introduces simplicity into the complex assortment and configuration planning process.