Enterprise Optimization: The End of One-Objective Planning
Optimizing for cost alone doesn't cut it anymore. Not in today’s enterprise.
Let’s say the plan looks good.
You’re hitting volume targets. Service levels are strong. The supply plan “feels feasible.”
But here’s the question every CFO, COO, and CSCO should be asking: At what cost? And to what end?
Most planning systems chase a single objective — usually service level or least-cost supply. But in the real world, supply chains don’t run on one objective. They run on conflicting imperatives: maximize margin, preserve cash, protect market share, reduce carbon, manage risk, and improve ROIC — all at once.
That’s the difference between classic optimization and Enterprise Optimization. And that’s where most planning systems fall short.
What Legacy Tools Get Wrong
Legacy planning platforms optimize in a straight line:
Serve this demand
At lowest cost
Subject to constraints
Sounds fine — until you realize this “lowest cost” approach often ignores:
Payment terms (which affect cash flow)
Supplier MOQs (which create excess and obsolescence)
Carrying cost (which hits your bottom line)
Strategic priorities like carbon footprint or new customers
Capital efficiency (which drives ROIC)
The result? A plan that looks optimal in theory — but leaks value at every turn.
Enterprise Optimization: Planning for the Real World
VYAN’s Enterprise Optimization (EO) engine reframes the planning problem around multi-objective decisioning, giving business leaders control over the tradeoffs that matter.
With VYAN, you can balance:
📦 Volume – Maximize fill rate. Protect market share.
💰 Margin – Prioritize high-margin products, customers, and paths.
💵 Cash Flow – Model payment terms, excess & obsolescence risk, and cash-to-cash impact.
📈 ROIC – Evaluate return on capital for major investments designed to close demand/supply gaps.
🌱 Carbon – Minimize emissions across sourcing and fulfillment.
⚠️ Risk – Understand what could go wrong, and plan for it.
Let’s unpack what changes when you actually plan this way.
🧠 Beyond “Volume First”: Why More Isn’t Always Better
Most supply chains are still stuck in the volume optimization mindset: "Just serve the customer — whatever it takes."
That’s fine… until you realize you're:
Air-freighting low-margin SKUs to meet unrealistic targets
Accepting unprofitable orders to “keep the lights on”
Burning working capital to chase fill rates that don’t pay back
VYAN shifts this thinking by explicitly optimizing for margin and cash flow, not just volume. That means picking the right customers to serve, the right paths to use, and the right tradeoffs to make.
💰 Margin vs. Cash Flow: Where Most Plans Go Blind
A supplier with the lowest unit price isn’t always the cheapest in the long run.
Let’s say:
Supplier A has 30-day payment terms and the lowest unit cost
Supplier B charges 5% more per unit but gives 120-day payment terms
Legacy optimizers will likely pick Supplier A.
But true optimization looks deeper:
Supplier A’s MOQ is 5x your net requirement
That creates excess inventory with 90 days of carrying cost
That hits your cash flow and may lead to write-offs
Meanwhile, Supplier B frees up working capital for 90 more days
When you model cash-to-cash cycle time, payment terms, and excess risk, the math shifts — and so does your “optimal” supplier choice.
📈 Why ROIC Belongs in the Planning Room
Most planning tools are great at answering: “Can we serve this demand?” Some go a step further: “Can we serve it profitably?”
But almost none ask the question every boardroom actually cares about: “Is this the best use of capital?”
That’s what Return on Invested Capital (ROIC) reveals — and it’s what most planning decisions quietly ignore.
Because not all margin is created equal.
You can:
Add a second contract manufacturer with slightly higher cost — or…
Build a new plant to lock in long-term scale
Both boost service. Both may deliver acceptable margin. But only one delivers a solid return on capital invested.
If the new facility runs at maximum 40% utilization for the next few years, is it really an “optimal” plan? If the same capital could boost fill rate in a more strategic region, is it smart to tie it up in underutilized assets?
Enterprise Optimization shifts the question from: “Is this profitable?” to: “Is this the best return on what we’re investing to make it happen?”
Because true optimization isn’t just about cost or margin — it’s about making every dollar of capital count.
🌱 Carbon Tradeoffs: Planning with Purpose
Sustainability isn’t a reporting problem — it’s a planning problem.
VYAN lets you explicitly model carbon footprint as part of the optimization objective. That means:
Prioritizing low-emissions transport and suppliers
Balancing emissions vs. cost vs. service
Quantifying how plan decisions impact ESG targets
Shift the weight on carbon in your Enterprise Optimization Profile within VYAN — and watch your “optimal” plan shift with it.
That’s real tradeoff intelligence.
⚠️ A Tease on Risk: Resilience Isn’t One-Size-Fits-All
In volatile times, what looks “optimal” on paper can fall apart in practice.
VYAN lets you build risk-adjusted plans using Monte Carlo simulations:
Quantify variability in lead times, demand, and yields
Run hundreds or thousands of AI-scale scenarios
Tune plans based on your risk tolerance (e.g., 80th percentile resilience)
We’ll go deeper in a future post — but for now, know this: Resilience isn’t a slogan. It’s a simulation — run at scale.
🧮 One More Tease: What Are You Really Paying to Serve?
Cost-to-serve isn’t just what shows up in your procurement, production, and logistics invoices.
The real cost includes:
Allocated labor and overhead
Inventory holding and shrinkage
Sales, service, and distribution effort
Most planners never see these. Finance buries them in allocation models. Ops ignores them altogether.
VYAN brings them into the light — with flexible indirect allocations that let you simulate true margin impact across customers, products, and fulfillment paths.
We’ll unpack this fully in an upcoming post on Total Cost to Serve — but here’s the truth: If you’re not seeing the full cost to serve, you’re optimizing blind.
Join the Value Pilot (If You’re Ready to Lead)
We’re inviting a select group of enterprise customers into our Value Pilot Program — where you pay only for services during the pilot, with a commitment to license the platform if (and only if) we prove tangible value.
If you’re a business leader tired of chasing metrics that don’t move the needle…
If you believe planners should be measured not just by process fidelity but by financial outcomes…
If you want your team to see, simulate, and reduce the true cost of tradeoffs…
Let’s talk.
