Smooth Optimization

Frictionless introduces solution that integrates with sourcing process

Cambridge, MA  July 17, 2002  Frictionless Commerce has announced the availability of it Frictionless Sourcing Optimizer, a sourcing optimization module that integrates with the Frictionless Sourcing software platform.

Developed at Frictionless and based on significant input from Operations Research experts and sourcing practitioners, this optimization module is designed to give purchasing professionals visibility into trade-offs between supplier bids and internal requirements and constraints, shortening the time it takes to make supply allocation decisions. In addition, Frictionless Sourcing Optimizer simplifies the process of weighting, analyzing and comparing supplier bids at the global and line-item level, so users can quickly and easily locate the optimal supply solutions.  

Frictionless said the Sourcing Optimizer has the optimization embedded within the sourcing process. Once RFx proposals have been received, purchasers can then automatically feed the data into the optimization engine to determine the right allocation by line items and total offers.

The module can weigh many different simultaneous factors, including: number of suppliers awarded, percentage of spend allocated to suppliers, delivery schedules and line item substitutions. Besides providing information on the cost and performance impacts of tradeoffs, as well as alternate offers and allocation strategies, the module also features an intuitive wizard that allows sourcing managers to establish, execute and review bid optimization scenarios. 

Tim Minahan, vice president of supply chain research at the Aberdeen Group, said, "Optimization-based decision support should appeal particularly to large enterprises that are confronted with examining complex, multi-line-item bids for multiple divisions and sites. The Frictionless Sourcing Optimizer has a high-level of usability, enabling frontline sourcing experts to define the analysis scenarios required to identify lowest total cost award allocation strategies that comply with their company's business objectives and constraints."

He added that Aberdeen's research has shown that companies can realize an additional 5 to 15 percent in cost savings by using optimization-based decision support.