Excess Inventory and Stockouts Aren’t a KPI Problem.

State of your supply chain in one click... But what do you do after that click?!     

Inventory is a business decision.

Planvida dashboard refreshes every day to tell you the facts:

• $15.1M in inventory
• 100.8 days on hand (healthy: 56-84)
• $4.4M of it is excess
• $13.5M more already on order
• Yet 52 SKU-locations are out of stock

If you have the right type of S&OP (or IBP as some like it) the question to ask:

"Why are we paying for excess and still losing sales?"

Excess plus stockouts is a decision problem:

• Do we have a consensus demand plan that the participants trust
• Lead times and MOQs - are they upto date
• Order size optimized?
• Stocking at the right locations of the network

Cutting stock fixes the KPI. It doesn't fix the business problem.

The goal isn't less inventory.

It's the right inventory, in the right place, for real demand.

That takes Demand, Supply, Inventory and Finance deciding together.

1. Inventory sits in the warehouse.
2. The decision belongs in the S&OP forum.

Which number would worry you most?

Question - do you have a real time view of your supply chain, at least once a day?!

Comment and share your experience - pain points or victories?!

Read our related posts:

Your Inventory Control Tower Shouldn't Just Report - It Should Decide

Average Fixed Lead Times Are Costing You Inventory and Trust

Excess Inventory Hiding Behind the IO Calculation!