Probabilities are persuasive in supply chains and analytic methods – especially in machine learning where conditional probability is a dominant underlying structure that makes or breaks the success of an application. In this blog, we will learn how to take the mystery out of the term ‘conditional probability’.
A common question is how to best manage safety stock for critical raw materials that are critical to the production of the exit product...
In a recent blog on Inventory Forecasting the core challenges and business importance of estimating inventory are outlined. A projected inventory position across time (plan) is a natural co-product of most central or master planning models that match assets with the demand to create a projected supply line linked to demand.
Inventory Forecasting is the process in which the historical sales data, historical purchasing data, current demand planning, planned production, and distribution resource plan data are used for predicting inventory levels in a future time period.
Scientific and system-driven Inventory Projection facilitates a quick decision-making process and enables a prompt analysis of alternative what-if scenarios. The following are the top 7 benefits of system driven inventory projection.
Supply chain planning projects are often approved on the back of the promise of lower inventory levels. In a recent conversation, I was asked a more nuanced question: whether right-sizing inventory via better supply chain planning improves earnings before interest, tax, depreciation, and amortization (EBITDA). This blog tries to address this question.
Striking the balance between overstocking and understocking should not always be a guessing game.
One of my favorite Holiday songs growing up was “The 12 Days of Christmas.” There was something about Christmas having 12 days that put me in the holiday spirit.
A guide on how to improve material planning using a more detailed volume allocation of customer orders. It is a common business practice to write up yearly contracts for the volume. Very often, this is done to extend volume discounts to the customer. That is obviously a benefit to the customer. The supplier benefits by knowing how much to budget for in terms of production through the year. They can also count on the revenue coming in.
What's the effect of customer order lead time in inventory management and safety stock calculations?