Sourcing priority rules

Ship nodes in a fulfillment network might share similar configuration levels but often vary in operational efficiency and cost. These cost differences can result from factors such as geographic location, labor skill levels, and infrastructure. Sourcing decisions are governed primarily by promising rules that select fulfillment locations based on order conditions. However, a fulfillment manager requires more control to prioritize the location selection. This prioritization helps to optimize fulfillment outcomes and reduce operational costs by considering efficiency differences across nodes.

Sourcing priority rules allows fulfillment managers to define sourcing prioritization by assigning priority values to a group of locations that include nodes or distribution groups. For example, you can set up a configuration to assign priority 1 to distribution centers, priority 2 to stores, and priority 3 to vendor locations. Once defined, IBM® Sterling Intelligent Promising makes the best effort to source from nodes that are based on the priority configuration. Other factors are also considered that might deviate sometimes from the priority configured due to promising constraints such as restrictions, delivery-Estimated Time of Arrival (ETA), and shipment counts.

When the sourcing priority rule is applicable, to determine the eligible sourcing nodes IBM Sterling Intelligent Promising applies a weighted evaluation in the following order:
  1. Location Priority, if a valid rule is defined.
  2. Shipment minimization.
  3. Earliest Delivery Date (EDD).
For more information about EDD, see SLA-based checkout.

Example

During peak seasons, a business designates specific locations to fulfill certain items as the highest priority. If those locations cannot meet demand, IBM Sterling Intelligent Promising sources from the next prioritized location, such as stores or external vendors. This configuration capability enables the business to optimize sourcing decisions and minimize overall fulfillment costs across the network.

Note: Currently, sourcing priority rules apply only to the non-cost based Calculate Checkout assignment API and the edd API only. For more information, see the edd and the calculateCheckoutAssignments API. The calculateCheckoutAssignmentsUsingCosts API does not support sourcing priority rules.

Sourcing priority rules overview

Sourcing priority rules can be configured with promising rules to influence sourcing decisions. Each rule consists of the following key components:
Activation
Controlled by the rule’s activation status and optional scheduling. Rules can be always active or limited to specific start and end timestamps.
Conditions
Uses the same condition framework that is used in promising rules. For a full list of supported conditions, see Promising rules.
Priority group
Specifies one or more priority groups and each group has a numerical value and an associated list of locations. Locations include individual nodes or distribution groups. A lower value such as 1 indicates a higher priority. For more information, see Creating and editing sourcing priority rules.

Sourcing consideration sequence with sourcing priority

When you apply sourcing priority to a cart line or item, IBM Sterling Intelligent Promising uses the Calculate Checkout Assignment API to incorporate the defined priority groups to determine the sourcing requirements.

Sourcing includes the following steps:
  1. API Invocation: The request is received through the calculateCheckoutAssignment API.
  2. Promising rule determination: The applicable promising rules are evaluated to identify a list of eligible sourcing locations.
  3. Priority group determination: Using the sourcing location listing, the list of prioritized locations are identified.
    Note: If the sourcing priority rule is too restrictive, for example, it includes a few nodes, it might limit the effectiveness of the sourcing logic. It is preferable to include a broader set of nodes to maintain a balanced and optimized sourcing strategy.
  4. Sourcing Prioritization: All the relevant factors are evaluated, such as sourcing priority, delivery estimated time of arrival (ETA), inventory availability, and capacity constraints to determine the final sourcing location. As IBM Sterling Intelligent Promising makes a best-effort attempt to meet the defined priority order, other constraints might lead to the selection of a lower-priority location.
Note: Multiple sourcing priority rules can apply to the same item request. For example, one rule might be based on order quantity, while another targets a specific item. In this scenario, to determine the sourcing priorities, the applicable locations are consolidated from all matched rules into a single list.

Example 1

Sourcing Priority Rule for Item: KEYBOARD:
  • Priority Group 1: N1, N2, N3
  • Priority Group 2: N4, N5

In this setup, the IBM Sterling Intelligent Promising first attempts to fulfill the order from N1 to N3. Any remaining quantities are then sourced from N4, N5.

Example 2

Using the same priority rule as in Example 1, you define a new sourcing priority that is specific to the KEYBOARD item, assigning Priority 1: N5 exclusively to it. This results in a highly restrictive sourcing strategy where only node N5 is eligible to fulfill the demand. As a result, the fulfillment flexibility is limited severely and the overall optimization effectiveness is diminished. This configuration is not recommended.

Sourcing priority rule resolution

Location priority rules support a mix of individual nodes and distribution groups within the same priority group. Since nodes within a distribution group can have their own node priorities, these priorities influence the final sourcing decision. For more information, see Distribution groups.

To compare multiple nodes, the sourcing logic adheres to the following general resolution rules:
  1. Explicit nodes take precedence in the same priority group.

    Within the same priority group, nodes that are explicitly listed take precedence over nodes that are included in a distribution group.

  2. Node priority is considered across nodes in distribution groups.

    If multiple distribution groups are configured in the same priority group, IBM Sterling Intelligent Promising evaluates the internal node priorities and selects the node with the highest priority.

  3. Repeated nodes that are across priority groups.

    If a node appears explicitly in both a higher priority group and within a distribution group in a lower priority group, the node is only considered within the higher priority group.