The Monte Carlo method is a well-known simulation technique that uses statistical random sampling to solve mathematical problems. In use for about 85 years, many variants exist across a wide range of disciplines. If not familiar, I suggest reading this Wiki page.
The key to increasing profitability is to identify which processes in your operations are or may become bottlenecks in the flow of work. Bottlenecks in business are the points where potential changes can have the most dramatic impact on the bottom line. While non-bottlenecks are important to consider from a cost accumulation standpoint, the majority of a manager’s focus should remain on the bottlenecks.
In the first decade of my career, most optimization models that I authored also required one or more scripts. They were necessary to automate tasks such as importing data, setting parameters, solving the model, executing another program (e.g., to crunch numbers), generating reports, and so on. Most were written in DOS shell, with an occasional UNIX shell depending on the platform used.
Enterprise Optimization™ in manufacturing has become increasingly beneficial for corporations in recent years, as software and our understanding of what makes companies tick have improved in tandem—but all the computing power and theoretical knowledge in the world won’t guarantee accurate, useful modeling for your optimization efforts. To get it right, and secure a real improvement in your company, you need to work with a solution which offers you several key factors—starting with the five we’re going to discuss here.
We here at River Logic are proud to announce a new resource aging feature now offered in Enterprise Optimizer® (EO), our modeling and analytics platform built to increase performance through fully integrated decision-making. Why have we decided to add this new feature you, might ask. For those familiar with EO, there are many types of resource decision making capabilities that are already supported. These include:
- Capacity Planning – evaluating production capacity needs for present and future periods, e.g. how many resources/production lines do I need to run and when?
- Production Planning – allocating production requirements to existing capacity, e.g. what products should I make on what resources?
- Resource Buy/Sell – evaluating major capital investment decisions to buy or sell individual resources.
- Facility/Location Open/Close – evaluating decisions to open/close entire physical locations and plants
When designing an enterprise model for planning purposes — one that accounts for strategic planning, financial planning and operations — several decisions are required. One of the most important is how to define time. The assumption of time definition has enormous implications for the type of questions that can be answered with the model and the value derived from such answers.