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Recent Industry Research Explores Increased Benefits of Multi-Echelon Inventory Optimization

The latest industry research reveals the goal of today’s supply chain professional must be to find the balance between service and investment. According to the report, “Inventory Optimization – Impact of a Multi-Echelon Approach,” published by Aberdeen Group and authored by Bryan Ball, vice president and principal analyst, supply chain management, companies which utilize multi-echelon inventory optimization (MEIO) have a more comprehensive understanding and view of inventory. The study, sponsored by Logility, notes these companies are twice as capable of meeting the challenge to balance cost and service levels across their network.

Key Findings

  • Leading driver for inventory optimization adoption is the need to reduce inventory carrying costs
  • Multi-echelon inventory optimization users are twice as likely to adopt advanced supply chain capabilities such as inventory segmentation, replenishment and event management than non-multi-echelon users
  • Multi-echelon users saw a 28% increase in inventory turns versus their non-multi-echelon counterparts
  • Multi-echelon users are twice as likely to tie target-setting to the S&OP process

Notable Quotes

“Inventory optimization is a matter of right sizing inventory investment for a given service target,” said Bryan Ball, vice president and principal analyst, supply chain management, Aberdeen Group. “For multi-echelon users, the performance improvement over non-multi-echelon users is significant with vast improvements in inventory turns, cash-to-cash cycle and perfect order improvement. As supply chains become more complex, the need to address end-to-end challenges effectively through the use of multi-echelon solutions will become a necessity, not an option.”

“From 2008 through 2010 companies slashed inventories to immediately remove costs without an understanding of the impact these measures would have on customer service, future investments and revenue,” said Mike Edenfield, president and CEO, Logility. “This Aberdeen Group report clearly shows how companies which utilize a multi-echelon inventory optimization solution, such as Logility Voyager Inventory Optimization™, are better able improve cash flow, reduce working capital and increase customer service.”

Additional Information

The report also features interviews with two Logility customers; Stanley Black & Decker and a global chemical company. Both of these companies rely on Logility Voyager Inventory Optimization to find the right balance between inventory investment and service goals with impressive tangible results across their global supply chain networks.

Resources

Download your complimentary copy of this report at: http://www.logility.com/inv-opt.

Logility Voyager Solutions: http://www.logility.com/solutions/supply-chain-solutions.

Inventory Optimization on The Voyager Blog: http://www.logility.com/blog.

About Logility

With more than 1,250 customers worldwide, Logility is a leading provider of collaborative, best-of-breed supply chain solutions that help small, medium, large and Fortune 1000 companies realize substantial bottom-line results in record time. Logility Voyager Solutions is a complete supply chain management solution that features a performance monitoring architecture and provides supply chain visibility; demand, inventory and replenishment planning; Sales and Operations Planning (S&OP); supply and inventory optimization; manufacturing planning and scheduling; transportation planning and management; and warehouse management. Logility customers include McCain Foods, Sigma-Aldrich, and VF Corporation. Logility is a wholly owned subsidiary of American Software, Inc. (NASDAQ: AMSWA). For more information about Logility, call 1-800-762-5207 USA or visit www.logility.com.

Forward-Looking Statements

This press release contains forward-looking statements that are subject to substantial risks and uncertainties. There are a number of factors that could cause actual results to differ materially from those anticipated by statements made herein. These factors include, but are not limited to, continuing U.S. and global economic uncertainty, the timing and degree of business recovery, unpredictability and the irregular pattern of future revenues, dependence on particular market segments or customers, competitive pressures, delays, product liability and warranty claims and other risks associated with new product development, undetected software errors, market acceptance of Logility’s products, technological complexity, the challenges and risks associated with integration of acquired product lines, companies and services, as well as a number of other risk factors that could affect the Company’s future performance. For further information about risks the Company and American Software could experience as well as other information, please refer to American Software, Inc’s. Form 10-K for the year ended April 30, 2011 and other reports and documents subsequently filed with the Securities and Exchange Commission. For more information, contact: Vincent C. Klinges, Chief Financial Officer, American Software, Inc., (404) 264-5477 or fax: (404) 237-8868.

Logility is a registered trademark and Logility Voyager Solutions is a trademark of Logility, Inc. Other products mentioned in this document are registered, trademarked or service marked by their respective owners.

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