Lead time optimization

A new home for the Coupa Supply Chain documentation

Starting with Supply Chain 42, our documentation will be located on Coupa Compass. The help here will continue to be accessible for the foreseeable future, but will no longer be updated. If you need a Compass user account, contact your company’s Designated Support Contact (DSC).

You can access new and updated Supply Chain documentation in the following location on Compass:

https://compass.coupa.com/en-us/products/supply-chain-design-and-planning

Lead time optimization

The model database includes fields to help constrain and minimize lead time. This feature allows you to set a cost for lead time beyond standard transportation costing. In general, lead time optimization is used in three ways:

It can penalize modes or sources that have longer lead times, by adding a cost to the lead time.
It can serve as a tie breaker to use the mode or source with a shorter lead time, if other costs are the same.
It can limit the lead time allowed by product-period.

You can assign a cost for 1 day of lead time per unit of product as well as a maximum value for the lead time times the flow of product. The lead time cost on flows is calculated as the product’s Lead Time Cost/Day/Unit * Flow Units * Service Hours/24. While this cost is not included in the total optimization cost, it is evaluated in an effort to minimize lead time.

The Products and Products Multi-Period tables include the following fields:

Field	Description
Lead Time Cost/Day/Unit	Use this field to specify the cost of 1 day of lead time per unit of product.
Max-Lead Time x Flow	Use this field to specify the maximum limit of the flow multiplied by the lead time.

If these fields are specified on the Products table, they apply to period 1. If they are also specified for period 1 in the Products Multi-Period table, the multi-period table entries take precedence.

Network Optimization output fields are included to report on the lead time optimization:

Table	Field	Description
Customer Flows	Flow Lead Time Cost	Displays the cost incurred on the customer flow due to lead time. This is calculated as the product’s Lead Time Cost/Day/Unit * Flow Units * Service Hours/24.
InterSite Flows	Flow Lead Time Cost	Displays the cost incurred on the intersite flow due to lead time. This is calculated as the product’s Lead Time Cost/Day/Unit * Flow Units * Service Hours/24.
Product Summary	Max Lead Time x Flow	Displays the maximum limit of the flow multiplied by the lead time.
	Lead Time x Flow	Displays the actual flow multiplied by the lead time.
	Remaining Lead Time x Flow	Displays the difference between the Max Lead Time x Flow and the Lead Time x Flow.

Last modified: Wednesday May 15, 2024

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