Planning Results

After having understood how to use the Supply Chain Network app to create a supply chain model, we have analyzed different situations within the complete plan scope through the Inventory Analysis app. Combining the insights from these two applications, now you can schedule a inventory planning run in different planning areas using several planning horizons within a predefined Inventory profile.

When you already have activated the inventory optimization algorithms, you can track the results via:

• Analytics and Dashboards
• Inventory Analysis app
• Supply Chain Network app
• Excel UI
• Planner Workspace

Using the Planning View IO 220 Planning Results allows you to identify use cases of standard key figures to fulfill specific business requirements within the Excel UI. On the slide, we can see the definition of every key figure within the tabs.

• IOFORECAST: Input key figure, result of the demand planning process, used to calculate the safety stock levels across the whole network.

• IOFORECASTERRORCV: Input key figure, needs to be sourced externally. Used to calculate the safety stock levels across the whole network.

• TARGETSERVICELEVEL: Input key figure, contains the desired target service level (non stock-out probability or fill-rate) for each customer group, product, location combination.

• INVENTORYHOLDINGCOSTRATE: This is the holding cost rate (not percentage) for each product-location combination. This is an input to the IO Algorithm and Supply module. The algorithm tends to push safety stock at locations where holding costs are lower. The holding costs are not assigned to any currency so these costs may be related to real costs or not, e.g. abstract penalty costs to enforce a certain behavior.

• LOCATIONRATIO: In the case of multi-sourcing for a location, this key figure defines the fraction of the total demand that is sourced for each period. This key figure is only used if the indicator is set in the corresponding SOURCELOCATION record.

• PRODUCTIONRATIO: In the case of alternative bill of materials or suppliers, this key figure defines the fraction of the total demand that is sourced for each period. This key figure is only used if the indicator is set in the corresponding SOURCEPRODUCTION record.

• PBR: Used to define the periods between replenishment for product-locations. Please note that this is an attribute as a key figure.

• TLEADTIME: Defined as attribute as a key figure of a source-location combination.

• TLEADTIMEVARIABILITY: Defined as attribute as a key figure of a source-location combination.

• TINCLOTSIZE: Defined as attribute as a key figure of a source-location combination.

• TMINLOTSIZE: Defined as attribute as a key figure of a source-location combination.

• PLEADTIME: Defined as attribute as a key figure of a source-production combination.

• PLEADTIMEVARIABILITY: Defined as attribute as a key figure of a source-production combination.

• PINCLOTSIZE: Defined as attribute as a key figure of a source-production combination.

• PMINLOTSIZE: Defined as attribute as a key figure of a source-production combination.

• IOMAXINVENTORY: Used to specify maximum expected on-hand level at the stocking point

• RECOMMENDEDSAFETYSTOCK: This key figure describes the quantity that should be in stock as safety stock per product and location. It is the quantity where the desired (for customer-facing nodes) or calculated non stock-out probability / fill-rate is reached.

• TARGETINVENTORYPOSITION: The TARGETINVENTORYPOSITION (TIP) is derived from the safety stock level. TIP is considered as upper level of a (s,S) policy. It is the safety stock increased by the expected demand during the exposure period (sum of PBR and lead time).

• AVAILABLEINFULL: This key figure contains the probability that the demand can be fulfilled = probability that the demand within a period is equal or lower than the recommended safety stock level.

  • For customer-facing nodes, this is equal to the weighted sum of all service levels requested by the connected demand stream (=input).

  • For internal nodes, the key figure contains the result of the optimization (=output).

• LOSTCUSTOMERDEMANDMEAN: This key figure contains the probability that the demand cannot be fulfilled weighted with the quantity that is lost. The probability for a stock out is 100% - AVAILABLEINFULL. This probability weighted with the difference between the quantity and the safety stock level is the expected lost demand mean (fill-rate). For non-stockout probability, the total quantity lost is used for weighting.

• AVGEXPEDITEVAL: This key figure contains the monetary value of the lost customer demand mean. The quantity is weighted with the costs per unit and if required converted to another currency.

• ABCSERVICELEVEL: This key figure contains the user specified target service level for each ABC segmentation.

• AVERAGESERVICELEVEL: This key figure contains the calculated service level to the downstream stocking nodes by the inventory optimization algorithm for the given service level type.

• MAXINTERNALSERVICELEVEL: This key figure contains user specified upper bound for internal service level calculated by the inventory optimization algorithm.

• MININTERNALSERVICELEVEL: This key figure contains user specified lower bound for internal service level calculated by the inventory optimization algorithm

• FINALIOSAFETYSTOCK: This key figure contains the final safety stock. The value is then released to APO/ERP and overwrites the key figure with the values from the last planning cycle.

• ADJUSTEDIOSAFETYSTOCK: This can be used for manually overwrite the recommended safety stock. If the user manually maintained this key figure, this value is stored in FINALIOSAFETYSTOCK, otherwise recommended safety stock is stored in FINALIOSAFETYSTOCK.

• FINALIOSAFETYSTOCKLASTCYCLE: Stores the values of the key figure FINALIOSAFETYSTOCK from the previous planning run.

• SAFETYSTOCKDELTA: Stores the delta between the key figure FINALIOSAFETYSTOCK and the key figure FINALIOSAFETYSTOCKLASTCYCLE

• RECOMMENDEDSAFETYSTOCKVAL: Contains the monetary value of the recommended safety stock. The quantity is weighted with the costs per unit and, if required, converted to another currency.

• IOAVGHISTDEMAND/VIOAVGHISTDEMAND: Contains the average historical demand.

• IOAVGHISTDEMANDCV/VIOAVGHISTDEMANDCV: Contains the coefficient of variation for the historical demand.

The slide presents three graphs on a Dashboard to plan different scenarios:

1. Target Service Level to Cost Curve - Recommended Safety Stock (US$)

   This is a line graph where you can identify the recommended Safety Stock Value (US$) vs. different target service levels grouped by finished products.

2. Target Service Level to Cost Curve - Target On Hand Stock (US$)

   This is a line chart where you can identify the On hand stock (Target) (US$) grouped by SKUs and different target service levels.

3. Scenario: COM333 Vendor Sourcing Lead Time Reduction - APJ Supply Chain

   This is a bar chart where you can identify the recommended safety stock, cycle stock (Target), and the on hand stock (Target) grouped by location, versions, scenarios, and a product.