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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

Could Quest for Working Capital Cripple Your Supply


Slashing Inventory May Leave Companies Unprepared for


Boston, MA – May 18, 2009 – 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® 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-
• 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

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.