Dear Systems integrated

Dear Systems, an increasingly popular cloud-based inventory management software, is now natively supported by Lokad.

Website refresh

Lokad turned 10 years old last spring, and a large redesign of our website was well overdue. Earlier this month, we rolled-out a new version of our website. It’s certainly the most usable and best looking website we have ever had.

One of the specific challenges that Lokad faces is the sheer amount of information that we have to convey. Supply chains are complex, and the Lokad platform reflects this complexity: we strive to make things as simple as possible, but not simpler.

We have put our content-heavy sections under a unified Learn umbrella. The technical documentation of Lokad itself has been moved to a separate website.

We remain committed to a high degree of transparency, putting as much information about Quantitative Supply Chain and Lokad’s platform itself online.

If you have any supply chain topics that you would like to be covered in greater depth, don’t hesitate to drop us an email to We can’t promise to address all questions, but most of the time, we do.

The limited applicability of backtesting

Backtesting is a design of experiment where one truncates historical data back to a point in the past, and applies a learning algorithm, or an optimization algorithm, against this truncated dataset in order to assess how well this algorithm would have performed under those historical conditions. The approach is simple and elegant, and thus is frequently quite appealing to supply chain practitioners. However, backtesting is far from being a silver bullet, and when its limitations are misunderstood, focusing on backtesting usually does more harm than good.

Improving a forecasting technology

Since Lokad’s creation , our goal has been to relentlessly improve our forecasting technology in order to deliver superior forms of supply chain optimization. Almost a decade ago, I was already pointing out that being a machine learning company is odd: progress is steady but also non-linear and erratic. Furthermore, most angles that are considered as common sense in other domains are plain misguided as far as machine learning is concerned. Yet, this does not imply that this progress is left to chance: there is a method to it.

Launch of LokadTV

As you may have noticed myself and the team here at Lokad have taken advantage of our new glamorous surroundings to work on a number of YouTube videos over the last couple of weeks. Within the videos we discuss the latest advances in technology and explore how they can bring change to the supply chain industry. This is an industry in which we have developed our understanding of over the last decade and we are eager to share some of the knowledge that we have developed along the way.

With clients all over the world, in practically every industry, we have experienced at first hand the frustration that dealing with archaic technology can bring. We have been fortunate enough to help clients overcome this frustration and reap the benefits of a well managed supply chain. The willingness of our customers to buy into our vision has been a key part in our success. We hope that through the medium of these videos we can help more people understand the potential that quantitative forecasting can bring to their organization and understand our disruptive vision of the supply chains of the future.

Our aim through LokadTV is to bring a bit of clarity to a range of topics which, despite vast amounts of media attention, are still remarkably difficult to interpret. You will notice that the discussions are unedited and filmed in one take. This we hope will give them an air of spontaneity and personability which would be lost by ‘over polishing’ the videos. We hope that you find the videos entertaining and educational, however more than anything we hope that they encourage a little bit of debate. We feel that is only by challenging the status quo that we can make progress in the industry and reach a day where supply chains benefit from the latest technology to become faster, leaner and more reliable.

So make sure you subscribe to our channel to keep up to date with the latest episodes.

Forecasting Accuracy

Forecasting accuracy is a subject that often divides the supply chain industry. Practitioners complain that the accuracy of their forecasts is too low whilst software vendors claim to deliver unrealistically precise forecasts.

Forecasting Accuracy

Artificial Intelligence

Artificial intelligence has become a buzzword in the world of technology over the last year or so. It has made numerous headlines with certain experts claiming that AI will replace half of the world’s jobs by 2050. However supply chains are still in the dark ages, too frequently managed by Excel sheets and in a very human driven way.

Artificial Intelligence

Blockchain and Bitcoins

Bitcoin has captured the imagination of the media and it’s easy to see why. With a mysterious, anonymous inventor, bad guys making fortunes with get-rich-quick frauds and random students becoming overnight millionaires it certainly has all the makings of a box-office hit. What about supply chains?

Blockchain and Bitcoins

Expanding office space at Lokad

Over the last couple of months Lokad has passed a number of important milestones, including the implementation of our deep learning forecasting engine and the publication of a new book. All of these milestones have been made possible by the hard work and commitment of the team here at Lokad, a team which is growing by the minute!

In order to make room for this growth, we are proud to announce that we have a new home, located at 83 - 85 Boulevard Vincent Auriol, 75013 Paris, twice the size of our previous location. The area is incredibly up-and-coming, boasting an impressive collection of street-art, as well as being home to a number of multinationals and the largest start-up campus in the world.

When I started Lokad back in 2008 we were a much smaller team working in a much more modest environment. Back then I would certainly not have anticipated that we would grow to such salubrious surroundings. However, it is my hope that this move reflects our ambitions for the future whilst being a comfortable new home for the diverse and industrious team we have built around us.

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Gold sponsor ACM programming contest

The future of supply chains depends on critical innovation such as deep learning or Bitcoin, the only blockchain that appears to have at least a plausible chance of delivering the massive on-chain scalability that supply chains require. Young talents capable of delivering tomorrow’s innovation should be attracted and nurtured. Thus, Lokad is proud to announce that - thanks to our sponsors CoinGeek and nChain - we have become a Gold Sponsor of the ACM programming context for Southwestern Europe.

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Programming contests are tough on students. It takes a lot of courage to participate, and naturally a huge amount of talent to have any chance of making it to the top ranks. Yet, it’s also a great opportunity to take part in a high-spirited event, intended to raise the bar of computer science skills of a whole generation.

SWERC participants need to demonstrate superior abilities in solving tough algorithmic problems, which are of primary relevance for supply chains. Indeed, crafting flexible, scalable, expressive algorithms are of primary importance in order to get more accurate demand forecasts and a better resolution for non-linear optimization problems.

Join us at SWERC 2018 and be part of the future of supply chains!

Beyond in-memory databases

Most IT buzzwords age poorly, and for a good reason: most tech that used to have a competitive advantage gets superseded by superior alternatives within a decade or less. Thus, if a software vendor keeps pressing a buzzword past its expiration date (1) then the simplest explanation is that its R&D team has not even realized that the world has moved on. Anecdotally, multiple venture capitalists have also told me that there were weary of investing in any software company that was more than a few years old, because most companies never manage to decouple their own tech from the tech landscape that defined them when they started.

Book: The Quantitative Supply Chain

My latest book, The Quantitative Supply Chain is out! This book presents the Lokad way of envisioning supply chains, which is best summarized through our supply chain manifesto. Your supply chain deserves what machine learning and big data have to offer.

The book can be acquired online.

Lokad will also be offering 100 copies for free to supply chain practitioners. Just drop an email to titled Free QSC book from your professional address. The free copies will be served on a FIFO basis, which we feel is the proper way to proceed with a supply chain audience.

From Crps to Cross Entropy

Our deep learning technology is an important milestone for both us and our clients. Some of the changes associated with deep learning are obvious and tangible, even for the non-expert. For example, the Lokad offices are now littered with Nvidia boxes associated to relatively high-end gaming products. When I started Lokad back in 2008, I would certainly not have anticipated that we would have so much high-end gaming hardware involved in the resolution of supply chain challenges.

Deep Learning as 5th gen forecasting engine

As part of our core commitment to deliver the most accurate forecasts that technology can produce, we are proud to announce that our 5th generation of forecasting engine is now live at Lokad. This engine is bringing the largest accuracy improvement that we have ever managed to achieve in a single release. The engine’s design relies on a relatively recent flavor of machine learning named deep learning. For supply chains, large forecasting accuracy improvements can translate to equally large returns, serving more clients, serving them faster, while facing less inventory risks.

MRO Europe in London, join us!

The Lokad team is at MRO Europe 2017 in London this week. Join us at our booth!

The age of online supply chains

We are proud to announce that Lokad now has a native integration for Piwik, an open source web tracking software. In short, Piwik is just like Google Analytics, except that it gives your company full control over your own web traffic data. In particular, it makes sense not to trust the same company with both your SEM (search engine marketing) spendings and your web conversion metrics: Piwik gives you precisely that.

An aviation case study: Spairliners

Back in 2014, Spairliners became one of the first companies to deploy probabilistic forecasts at scale to improve their supply chain. It turned out that those forecasts are an excellent fit for aerospace challenges. Fast-forward present time, Spairliners has agreed to let us produce a video case study. Enjoy!

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Periodic demand forecast

As a rule of thumb, whenever supply chain is involved, probabilistic forecasts yield superior results compared to traditional periodic forecasts; i.e., forecasts expressed per day, week or month. Yet, there are also a few situations where demand uncertainty is very low such as where demand is very steady and non-sparse. In those situations, it might still make sense to consider periodic demand forecasts. Therefore, we have extended our latest forecasting engine to support periodic forecasts.

Text mining for better demand forecasts

We are proud to announce that Lokad is now featuring text mining capabilities that assist its forecasting engine in delivering accurate demand forecasts, even when looking at products associated with sparse and intermittent demand that do not benefit from attributes such as categories and hierarchies. This feature is live, check out the label option of our forecasting engine. The primary forecasting challenge faced by supply chains is the sparsity of the data: most products don’t have a decade’s worth of relevant historical data and aren’t served by thousands of units when considering the edges of the supply chain network.

Entropy analysis for supply chain IT system discovery

The IT landscape of supply chains is nearly always complex. Indeed, by nature, supply chains involve multiple actors, multiple sites, multiple systems, etc. As a result, building data-driven insights in supply chains is a challenge due to the sheer heterogeneity of the IT landscape. Too frequently, supply chain analytics deliver nonsensical results precisely because of underlying garbage in, garbage out problems. At Lokad, we have not only developed a practice that thoroughly surveys the IT landscape and the datasets inhabiting it, but we have also created some bits of technology to facilitate the surveying operations themselves.

Probabilistic demand forecasting for Fashion

A few weeks ago, in Berlin, Lokad was invited on stage at Vizions 2017 to give a talk about probabilistic forecasting and how this paradigm will change the future of supply chain for the fashion industry.

Probabilistic demand forecasting for Fashion

The illustrated stock reward function

The stock reward function is a key ingredient to make the most of probabilistic forecasts in order to boost your supply chain performance. The stock reward is used for computing the return on investment for every extra unit of stock to be purchased or manufactured.

The stock reward function is expressive and can be used like a mini-framework for addressing many different situations. However, as a minor downside, it’s not always easy to make sense of the calculations performed with the stock reward function. Below you’ll find a short list of graphs that represent the various transformations applied to the forecasts.

The Supply Chain Scientist

Artificial intelligence has been making steady progress over the last few decades. However, while self-driving cars might be just around the corner, we are still decades away from having software smart enough to devise a supply chain strategy. Yet, at the same time, it would be incorrect to conclude that supply chain as a whole is still decades away from being positively impacted by machine learning algorithms. Lokad’s supply chain science competency was born out of the observation that while algorithms alone were insufficient, they actually became formidable enablers in the hands of capable supply chain experts.