What is the difference between Demand planning and Inventory optimization ?

The Smart Forecaster

Pursuing best practices in demand planning,

forecasting and inventory optimization

What is the difference between Demand planning and Inventory optimization ? 

The Smart Demand Planning app (SDP) provides demand forecasts. The SDP forecasting engine is also the core of the Smart Inventory Optimization app (SIO), which stress-tests various inventory policies using a number of demand scenarios to find optimal inventory policy settings.

 

 

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Centering Act: Spare Parts Timing, Pricing, and Reliability

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In this article, we’ll walk you through the process of crafting a spare parts inventory plan that prioritizes availability metrics such as service levels and fill rates while ensuring cost efficiency. We’ll focus on an approach to inventory planning called Service Level-Driven Inventory Optimization. Next, we’ll discuss how to determine what parts you should include in your inventory and those that might not be necessary. Lastly, we’ll explore ways to enhance your service-level-driven inventory plan consistently.

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      Share, develop, and manage consensus demand plans

      The Smart Forecaster

       Pursuing best practices in demand planning,

      forecasting and inventory optimization

      Share, develop, and manage consensus demand plans to ensure inventory policy matches business strategy.

      Smart Inventory Optimization (SIO) creates planning scenarios. SIO starts with a “Live” scenario that shows where you are now. Various team members can create their own scenarios, perhaps dividing the work by product line or sales territory. One decision maker can then merge these scenarios into a consensus plan that becomes the “Goal” scenario, which drives the ERP system’s replenishment planning.

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          FORECAST DRIVEN INVENTORY MANAGEMENT

          The Smart Forecaster

           Pursuing best practices in demand planning,

          forecasting and inventory optimization

          Improve Forecast Accuracy, Eliminate Excess Inventory, & Maximize Service Levels

          In this Video Dr. Thomas Willemain, co–Founder and SVP Research, talks about forecast-based inventory management policy, also known as MRP logic. This is the fourth in our series on major approaches to managing inventory.  We begin by looking at some very simple and then more robust models of inventory dynamics that help us determine how much to order or manufacture and when. We then consider how to calculate lead time and account for lead time variability. Tom concludes by describing the importance of safety stock, it’s role in properly buffering against demand and supply uncertainty, and how best to calculate it. 

           

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              How do you know Min/Max policy is working well for you?

              The Smart Forecaster

               Pursuing best practices in demand planning,

              forecasting and inventory optimization

              What is a Min/Max policy? How do you know is working well for you? Smart IP&O gets Min/Max right!

              The Min/Max inventory policy is one of four available Replenishment methods in SIO. When the inventory level drops to or below the Min, a replenishment order is generated. The reorder quantity is the number of units needed to raise the stock up to the Max. How do you know your Min/Max settings are working well and triggering replenishment orders at the right time and for the right quantities? If you are like most companies, setting Min/Max levels is based on rules of thumb or simple averaging techniques that don’t expose the trade off curve between service level and inventory cost. This makes it impossible to predict which items are likely to have overstocks and shortages in the future. In this Video Blog we elaborate on this and describe how Smart Inventory Optimization can help.

               

               

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