INSIGHT Software: How Five PhDs Helped Shape the Supply Chain Design Industry

INSIGHT Software was just acquired by Optilogic. Here’s how INSIGHT pioneered some of the most critical capabilities in supply chain design today and left an indelible mark in the industry over its 40-year history.

The first act: Strong academics put into practice

The story of INSIGHT begins with five world-class PhD researchers with big ambitions. These men, hailing from UCLA, the Naval Postgraduate School, and the U.S. Military, were pioneers in early supply chain design, conducting deep academic research in optimization with over 300 published papers in professional journals. The team engaged with the US Department of Defense (DoD) on a study on material distribution beginning in 1974, thereby successfully transitioning their work from the classroom to the real world—and with one of the largest supply chain networks in the world.  In 1978 INSIGHT was officially launched. Dick Powers was the original CEO and served in that role until 2004. Jeff Karrenbauer, one of the original founders, succeeded Dick as CEO from 2004 until 2020. Jeff used his PhD thesis work with Ross Laboratories to transition the nutritional products company, now a division of Abbott Laboratories known as Abbott Nutrition, into one of INSIGHT’s first customers.  Jenny Sweatt succeeded Jeff as CEO of INSIGHT in 2020 and served until the Optilogic acquisition in late 2023.

INSIGHT’s founders: “They were ahead of their time”

Industry insiders agree that INSIGHT’s founders developed technology and approaches in supply chain optimization that were well ahead of their time. They set out to build the best solving technology and never wavered in this commitment during the lifetime of the company, continually improving the technology to do many different optimization functions as customers asked for more and different capabilities.

INSIGHT SAILS becomes flagship design solution

When INSIGHT launched its flagship product SAILS in 1979, there were few competitors in the supply chain design space. Subsequent industry giants LogicTools, Barloworld, and LLamasoft came along later and replicated, in their own ways, the design capabilities SAILS developed. SAILS (Strategic Analysis of Integrated Logistics Systems) originated in a time before “supply chain” was a ubiquitous term. Back then, it was all about “logistics”, though today not much has changed in basic challenges of moving goods from one place to another in the most efficient manner. Crucially, the advent of supply chain modeling forced practitioners to think about the whole system versus individual functions.SAILS started out as a basic distribution planning application, i.e., a set of customers are serviced by distribution centers that get products from manufacturing plants. Over time, this focus expanded to other critical supply chain design areas that became foundational for today’s design solutions:

• Production planning—models incorporated raw materials from suppliers, and multiple product lines that convert raw materials and byproducts into finished products ready for distribution.  
• Multi time-period models which divided customers into different channels (retail, wholesale, etc.) and began with detailed SKU-level input data that was aggregated into tables and mapped to product groups for simplified analysis.
• Transportation planning was also added with distance-based equations and manual input rates. A shipment simulator considered all shipments and freight rates to calculate weighted average rates to use across all lanes. This feature became a big selling point for SAILS.
• Taxes and duties modeling was introduced as an industry-first capability.
• Vulnerability analysis was incorporated into SAILS before supply chain risk became a ubiquitous term. Customers used this capability to assess implications of facility shutdowns, etc. and more detailed risk analysis.
• Environmental and CO2 modeling customers used to improve operations while limiting carbon footprint.
• Marketing costs, response functions and resource limits within an overall profit max umbrella. This was fully integrated into SAILS and resulted in a comprehensive corporate model.
• Comprehensive stochastic simulation model with embedded transportation optimization was seamlessly incorporated into the SAILS database, GUI and executable.

Legacy in quality, integrity, and customer loyalty

INSIGHT’s founders never wavered from their commitment to developing the very best solver technology to provide quality, reliable solutions for their customers, which is manifested in long-term customers, several of which were licensees for more than 20 years.  

According to long-time supply chain analytics leader and former P&G executive Glenn Wegryn, “For over 20 years, INSIGHT’s SAILS product guided many internal studies on distribution and manufacturing capacity at Procter & Gamble, identifying millions of dollars of savings and service improvement opportunities. It is one of the many reasons why P&G is considered a transformational leader in supply chain management."

As another long-time customer put it, “INSIGHT SAILS has been a critical component of our success, delivering a clear supply chain strategy during a volatile time for the consumer electronics industry. It has been an integral part of decision making for our distribution and fulfillment network design, and resulted in tens of millions of dollars is cost savings.” At one time over half of the Fortune 50 used SAILS software.

“INSIGHT SAILS did what it was advertised to do,” said former employee and industry expert Tony Mirra. “The company guaranteed it, and as a result have very long-standing and loyal customers.”

Today the rich legacy of INSIGHT in supply chain design lives on with the new leader in design, Optilogic. INSIGHT Co-founder and CEO Jeff Karrenbauer will continue to provide wisdom and guidance in the path forward. “I want to thank all of INSIGHT’s employees and the customers we’ve served over many years,” said Karrenbauer. “It’s time to pass the torch to the next generation in supply chain design. I’m confident that INSIGHT’s customers will be in good hands with Optilogic under Don Hicks’ leadership.”

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