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ed for a more adaptive supply chain. Current practices could not keep up shorter order-to-deliver cycle times and movements to eliminate safety inventory and shift to flow-through adaptation.
With the possibility that BiosGroup might help P&G succeed where traditional supply chain methods had failed, P&G challenged BiosGroup to reduce the cost of P&G's inventory by 50 percent. Rather than ask BiosGroup to deliver the solution, P&G wanted evidence that a solution was possible.
BiosGroup created a much-different solution from that provided by traditional supply chain management software, which allowed companies to plan and manage the flow of products, design transportation networks, and schedule production. Instead, BiosGroup scientists built a model that visualized the flow of goods through the system in a virtual world. By creating and manipulating this virtual world, BiosGroup and P&G could measure with much greater accuracy the impact of various demand shifts and distribution decisions.
Use of agent-based models. To simulate P&G's supply chain, BiosGroup used a technology called "agent-based modeling." In agent-based modeling, small software modules represent the various physical components of a system. An agent represents a manufacturing line, and other agents represent trucks, warehouses, customers, and consumers. BiosGroup initially modeled the transportation and logistics of one particular product: antidandruff shampoo.
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