Cost Model within a Digital Planning Twin

 

According to Aaron Berg, VP of River Logic Strategy, the Digital Planning Twin, specifically within River Logic’s system, is distinguished by its meticulous cost modeling approach. In crafting a comprehensive plan for production volume, a key concern is predicting the resultant financial outcomes.

This necessitates a detailed breakdown of costs into their essential drivers within the business structure. Rather than providing a fixed cost, this approach involves specifying raw materials, considering procurement options, and accounting for various cost implications tied to different vendors.

Additionally, it encompasses production-related costs like electricity, packaging, and labor, with a nuanced understanding of labor costs tied to specific work centers and production throughput. The result is a tool that not only forecasts costs accurately but also offers insights into optimizing shifts, overtime, and inventory, ensuring economic fidelity in planning and decision-making.

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