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The Value of Network Analysis and Design

04/25/2017

Almost every organization is interested in lowering their operating costs, but one of the simplest ways to make it happen all too often remains an afterthought — Network Analysis and Design.

 

The reason to run a Network Analysis typically takes three forms:

  1. Customers that have never conducted a Network Analysis
    In these instances, it’s not uncommon for the business to have grown somewhat by chance. While by no means disastrous, this can result in a mismatch between the network and demand.
  2. Clients that have conducted a Network Analysis but fail to do so on a regular basis
    Things change. It’s a fact of life and business. However, when you fail to adapt and make the necessary corrections, you end up solving the same problem again and again. So, if your customers have shifted and your demand has grown in proportion to the population (perhaps very heavily in one region), it pays to reevaluate whether your network is positioned to service this demand.

  3. Mergers and acquisitions
    When two companies become one, there are going to be redundancies. The question is which to keep and which to jettison. Once these decisions have been made, you will then need to determine how to service the new combined business demand as efficiently as possible.

 

At Unyson, we offer our Network Analysis exclusively to clients that utilize our freight management services, allowing us to provide added insight and scenario planning expertise at a reduced cost. This integration also speeds up the process because we’ve already captured the needed data. As such, we are frequently able to provide clients with a transportation baseline within one week and complete the entire process from start to finish in less than 60 days.

 

We begin most engagements by asking a simple question — What will and what won’t you do? — in order to get a grasp of our client’s network complexity and quickly scope the analysis. The key is that we don’t just view the network. We also support the transportation side, which distinguishes us from a typical consulting engagement that focuses predominantly on short-term solutions. We zero in on the exact opposite, which means if there is any recommendation of change, we track the implementation of that change along with the savings throughout the entire life cycle.

 

Our analysis is only as the good as the forecast it’s built on. With this in mind, we also work to incorporate a range of tolerances so that when we run our projections, we don’t claim where we see sales five years from now as an absolute. In reality, that number is NOT what the sales will be; it reflects what our customer hopes they will be. We acknowledge this by incorporating sensitivity analysis into the process — increasing and decreasing the demand at individual stores according to an iterative scenario approach — to deliver multiple five year DC projections and pinpoint which network will provide the best cost profile.

 

Please feel free to reach out to me with any questions, as I would love to hear from you and learn from your insights. I also encourage you to subscribe to our Executive Vice President’s newsletter by emailing info@unyson.com. Thanks for reading.

 

Working to adapt your network to meet your needs.

 

Mark Tornga

Senior Business Intelligence Analyst

mtornga@unyson.com