O2 cloud-based supply chain slashes inventory levels

O2 in the UK has cut its handset inventory levels in its warehouses to the equivalent of about one day, instead of two to three weeks.


O2 in the UK has cut its handset inventory levels in its warehouses to the equivalent of about one day, instead of two to three weeks.

The mobile operator and retailer has achieved the savings using a new cloud-based supply chain offering from Liaison Technologies.

Giles Scrafton, IT application manager at O2, who is responsible for overseeing the end-to-end management of the company’s supply chain IT systems, said the company was under pressure to make changes.

Scrafton said, “In an increasingly competitive market we are constantly looking at ways to improve efficiency and build stronger ties with our supply chain. Reducing the millions of pounds of inventory in our warehouse is a good place to start.”   

O2 said it recognised that a more closely integrated, holistic and agile supply chain would enable it to move products more quickly from the distribution centres, allowing it to keep up with customer demands and reduce stock obsolescence.  

Previously, sales, inventory and forecasting information was typically shared with O2’s suppliers via email. It was often out of date and inaccurate. This made collaborative planning extremely difficult and often led to O2 having too much stock sitting in its distribution centre, which was proving costly.   

Scrafton said, "Using email to control inventory and forecasting was not good enough. We clearly needed a better way to share sales and forecasting information with our suppliers to work together more effectively and optimise demand planning.”

O2 went to Liaison Technologies because the vendor could consolidate data from different supplier platforms and provide it with "real-time visibility at a reasonable cost".  

O2 now operates Liaison’s cloud-based B2B integration platform, along with its monitoring application, Liaison Enterprise Navigation System (LENS). The LENS tool allows users to access up-to-the-minute metrics, performance statistics and trading partner information, and can also be used to track the live status of all messages sent through the system.

With Liaison hosted in the cloud Scrafton said he had spent little time managing the system. He said, "When a new supplier is added we create a mapping template for Liaison, which usually takes less than 24 hours, and Liaison does the rest.”

As O2 suppliers can also access the portal they are able to plan future inventory requirements more accurately. “Allowing our suppliers to access the system is a great way to improve collaboration and keep up with changing stop requirements," said Scrafton.

In other supply chain news Co-operative Food is cutting food delivery miles and slashing carbon emissions with the help of a new transport logistics system (https://www.computerworlduk.com/news/applications/3405543/co-operative-food-cuts-carbon-with-new-logistics-system/).

The Co-op has added Paragon's dynamic transport planning solution to its logistics service operation. The switch to a "dynamic resource managed planning approach", says the Co-op, has already delivered a 5 percent cut in delivery miles at a pilot depot.

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