Margin Optimization

ORSOFT Enterprise Workbench contributes to finding strategies to optimize margins:

  • reduction of production costs
    (e.g. by using the best technology, by avoiding cutting scrap, by reducing down times and defective production, by increasing energy efficiency)
  • maximum utilization of volatile raw material prices and exchange rates
  • improved satisfaction of demands
    (e.g. alternative delivery of goods with higher quality to avoid set up that would be more expensive)

If there are highly dynamic production conditions (e.g. dramatic fluctuations in demand, exchange ratio, raw material and energy prices), production strategy and objective function must adapt immediately.

In cases of overcapacities, priorities may shift from best possible satisfaction of demand to maximizing margins or minimizing but cost-covering sales prices. Margin optimization is based on enterprise planning (order situation, capacity availability etc.) and commercial information (pricing, exchange ratio, transportation costs).

This data is held within the detailed planning model. ORSOFT Enterprise Workbench provides its own standardized solution to transform a SAP ERP / SAP S/4HANA model to a LOP (linear optimizing program) and uses commercial solvers to determine optimized planning results.