Optimization technology is based on applied mathematics and computer science, and is widely used to help business people make better decisions. It can quickly determine how to most effectively allocate resources, automatically balancing trade-offs and business constraints. It eliminates the need to manually work out plans and schedules, so you get maximum operational efficiency. You provide the information, and IBM ILOG Optimization does the work.
Why IBM ILOG Optimization?
IBM is a leader in the field of Operations Research, and specifically in the discipline of optimization. We offer some of the world's most advanced optimization technologies for solving tough business and research problems—longer than anyone. Our award-winning tools and engines speak for our high standards and belief in innovation. And we're always thinking of something new.
See for yourself why more than 1,000 universities use IBM ILOG Optimization for research and teaching, and more than 1,000 commercial customers, including over 160 of the Global 500, use IBM ILOG Optimization in some of their most important planning and scheduling applications.
Key benefits
Maximum operational efficiency: Improve utilization for any sort of resource: capital, personnel, equipment, vehicles, facilities. Assign the best resources to each task, at the best possible time.
Uncover solutions to the toughest challenges: Explore alternatives in minutes. Cope with the most difficult trade-offs that nobody had ever considered. Extract the maximum yield from every resource. Cope with the toughest conflicts.
Measurable return on investment, fast: See results within months, or even weeks. Costs drop, earnings increase and service improves. Customers are happier, and so are your employees. Some applications save thousands of dollars a year, and others save millions—but there is always a return on investment (ROI).
Applications in every industry: Optimization is at work everywhere: manufacturing, transportation, logistics, financial services, utilities, energy, telecommunications, government, defense and retail.
How Optimization Works
Optimization technology helps organizations make better plans and schedules.
A model captures your complex planning or scheduling problem. Then a mathematical engine applies the model to a scenario find the best possible solution.
When optimization models are embedded in applications, planners and operations managers can perform what-if analysis, and compare scenarios.
Equipped with intelligent alternatives, you make better decisions, dramatically improving operational efficiency.
Optimization can help you:
Cut operating costs
Avoid capital expenses
Shorten delivery times
Offer flexible, precise customer service
Provide personalized work schedules
Manage risk
Maximize profitability
Understand future scenarios
There's no mystery to optimization. It's a straightforward process that achieves measurable results:
An optimization model defines and structures your problem
An optimization engine applies your model to data and searches for a solution
The output is the best plan or schedule
It all starts with an optimization model
An optimization model is a set of equations that define all of the components in a planning or scheduling problem, such as:
Resources available
Demand to be filled or services to be performed
Operating and capital costs
Yield and throughput assumptions
Global operating constraints
Individual operating constraints and preferences
Goals, either individual or in weighted combination
Key performance indicators (information about the plan)
Decisions to be made
Optimization engines produce plans or schedules
What's especially significant is the sheer amount of information that an optimization model can process. A well-built optimization model is capable of evaluating millions of possibilities, and recommending thousands of individual decisions.
An optimization model's output can take any number of forms. Examples include:
General six month production plan
Detailed one week production schedule
One month workforce schedule
Truck loading plan
Set of routes to deliver a day's worth of goods or services
Number of trades to bring a stock index fund back into compliance
Marketing-offer assignments for a marketing campaign
Best loan package at the best price
Bids to accept in a procurement management system
When to release airplane seats or hotel nights at a lower price.
Plans and schedules deliver astonishing results
Nothing can prepare you for the effect optimization can have on operational efficiency. Plans or schedules you once labored over for days appear in just minutes—without errors. After you've integrated optimization into your planning and scheduling, your costs will be greatly reduced.
For example:
A car manufacturer increased productivity by 30%
Chile's two largest forest-products companies reduced their truck fleets by 30%
A semiconductor manufacturer cut wafer-processing cycle time in half, to just 30 days
A major airline responded to unexpected delays with efficient crew rescheduling, saving $40 million in one year
A package-delivery company cut costs by $87 million
A television network increased annual advertising revenue by $50 million
An investment firm cut transaction costs by $100 million
A major consumer packaged goods (CPG) manufacturer dramatically increased the direct loading of trucks off its packaging lines
Often, optimization uncovers decisions you might never have considered. No one can analyze so many options, so fast. Optimization's speed gives you time to experiment with different assumptions. You're free to study a range of scenarios, applying your judgment to all your options.
