Supply chain start-up in the spotlight: GenLots

GenLots was originally founded by Simon Schenker and Arnaud on the EPFL campus in Lausanne, Switzerland, in 2017, stemming from research into the use of machine learning in the planning of material purchases. The conclusion was that, despite ever-more complex and more global supply chains, supply planning and ERP systems have hardly changed in the past 30 years, and so there was still room for optimization. GenLots responded by inventing an advanced reinforcement learning algorithm, combined with a new way of assessing supply planning costs, that departs from the legacy formulas.

The solution enables manufacturers to shift to fully digital supply planning, thereby reducing costs, mitigating risks and improving visibility. The start-up claims that, when it comes to supply planning, existing ERP programs do not model all relevant factors and do not show the financial impact of decisions being made. Therefore, to square hard trade-offs, the proprietary GenLots algorithm has an incentive structure modelled on the actual total cost of supply planning for a specific material. This supports supply planning excellence, reducing deliveries by up to 50% and inventories by up to 30%. The Opportunity Dashboard visualizes the savings potential of each material in real time, and also issues alerts and recommendations to planners related to scrap risks, inventory capacity, stock-outs and safety stock levels. Besides supporting cost optimization, this is also extendible to include other factors such as CO₂ emissions in its model of the world.

Partnership with SAP

The latest step in the start-up’s journey has been a partnership with SAP, market leader in enterprise resource planning, for easier integration and a coordinated approach to new customers. The implementation takes less than six weeks, and standardized integrations mean that it places minimal demands on client resources and IT. Now based in Morges, GenLots has five employees and already serves a number of large clients in consumer goods, pharma, chemicals and industrial goods.