As economic challenges increase, companies are nowadays more than ever required to adapt their supply volume to customer demand: Traditional inventories have to be reduced and the assets locked up have to be released. This is where inventory optimization comes in to play a significant role in optimizing inventory levels. Inventory Optimization (IO) as an EdgeOne-App of the ORSOFT Enterprise Workbench supports companies to balance conflicts between a high service level for customer orders and minimal inventory costs. By using techniques of machine learning, EWB IO periodically calculates master data that is relevant to production.
Based on historical data and other parameters, ORSOFT EWB Inventory Optimization estimates a safety stock level for sales products and purchased materials. Thus, calculations for safety stocks are carried out in six steps:
- Evaluation of historical data for purchasing and sales, e.g. from SAP Business Warehouse (BW) or SAP ERP
- ABC/XYZ analysis of both material types and subsequent clustering
- Effective calculation of the safety stock or lot size
- Before-after analysis of safety stock or lot sizes. Users can check the effects of the calculated and [optionally] manual changes on future stock levels using diagrams and key figures.
- Users can export the changed safety stock and lot sizes back to SAP ERP. All changed master data is now applicable to all users.
- Finally, automated pushes can be used if modified safety stocks/batch sizes are relevant for other ORSOFT applications.
ORSOFT Inventory Optimization was redesigned within the scope of Germanedge and seamlessly fits into the world of the ORSOFT Enterprise Workbench. As an EdgeOne app, Inventory Optimization enables continuous calculation, monitoring, analysis and updating of safety stocks and lot sizes. This reduces inventory costs permanently and significantly.