The possibilities that impact order sourcing, processing, and shipping can be overwhelming, and they directly influence your customer satisfaction and profitability. However, with IBM Sterling Fulfillment Optimizer with Watson, you no longer need to balance competing parameters and business objectives on your own.

Fulfillment Optimizer is a cognitive solution that integrates with an existing Order Management System (OMS) to determine the most cost-effective option for fulfillment based on your business priorities. Every time an order is sent to Fulfillment Optimizer, it performs multi-objective optimization to determine the best options for sourcing and fulfillment.

Fulfillment Optimizer considers five primary business objectives during order optimization to decrease fulfillment costs and use inventory more efficiently:
  • Minimizing shipping cost
  • Avoiding stockouts
  • Avoiding markdowns
  • Minimizing processing cost
  • Balancing node capacity

Your organization sets weights for each of these objectives based on your business goals. Then, Fulfillment Optimizer uses those weights to determine the best option for fulfilling each order based on your business priorities.

Fulfillment Optimizer applies many rules, configurations, constraints, and cost optimization goals to each order to determine the most optimal way to fulfill it. Every time an order is sent to Fulfillment Optimizer, it analyzes the following information from the integrated OMS to create predictive cost estimations and improve the total cost to serve (TCS):

  • Number of items in an order
  • Item size and weight for packaging
  • Current inventory status and capacity of each available node
  • Shipping options and costs of fulfilling at each node
  • Item availability
  • Handling and processing costs
  • Customer service level agreements (SLAs)

You might be wondering, Why was a shipment upgraded? or, Why was an order split into multiple shipments?

You can drill down into the fulfillment and sourcing decisions for each order and how it was optimized to meet your objectives within Optimization explainer.

Moreover, Benefits report provides visibility into the shipping and inventory benefits that your organization obtained by using the inventory model for order optimization. You can use this information to assess the overall business impact of using Fulfillment Optimizer.

On the Viewing optimization dashboard, you can view Key Performance Indicators (KPIs) that provide information about the overall status of your fulfillment network.

Through optimized sourcing, Fulfillment Optimizer reduces the total cost to serve and works toward omnichannel profitability, a balanced fulfillment network, and stockout and markdown avoidance.