Jonathan Gross
29th August 2011, 23:23
A new blog entry has been added:
ERP Planning Tip #5: The Importance of Accurate Inventory Data
In our previous ERP planning tip (http://www.pemeco.com/v1000/resources_center/erp-planning-tip-4-routings-final-data-requirement), we discussed routings, the final data set-up requirement for making an item. In this tip, I dig deep into another critical data requirement – the need to maintain timely and accurate inventory counts and movements.
If inventory counts and movements aren’t accurately reflected in the planning engine, MRP will issue inaccurate recommendations. This might mean that replenishment order recommendations are issued to soon – which could lead to unnecessary increases in operating costs and constraints to cash flow. It might also mean that replenishment order recommendations are issued too late – which could create customer churn caused by avoidable order delays. Finally, it might mean that replenishment order recommendations are made for the wrong items or quantities – which could result in unnecessary orders of depreciating inventory.
The key, therefore, is to ensure that the planning engine issues planning recommendations for the correct items and quantities at the appropriate times. To issue just-in-time, time phased replenishment orders, the planning engine requires five basic data elements:
ERP Planning Tip #5: The Importance of Accurate Inventory Data
In our previous ERP planning tip (http://www.pemeco.com/v1000/resources_center/erp-planning-tip-4-routings-final-data-requirement), we discussed routings, the final data set-up requirement for making an item. In this tip, I dig deep into another critical data requirement – the need to maintain timely and accurate inventory counts and movements.
If inventory counts and movements aren’t accurately reflected in the planning engine, MRP will issue inaccurate recommendations. This might mean that replenishment order recommendations are issued to soon – which could lead to unnecessary increases in operating costs and constraints to cash flow. It might also mean that replenishment order recommendations are issued too late – which could create customer churn caused by avoidable order delays. Finally, it might mean that replenishment order recommendations are made for the wrong items or quantities – which could result in unnecessary orders of depreciating inventory.
The key, therefore, is to ensure that the planning engine issues planning recommendations for the correct items and quantities at the appropriate times. To issue just-in-time, time phased replenishment orders, the planning engine requires five basic data elements: