Inventory Optimization Tool (IOT), by Ultriva, projects optimal inventory requirements through simulation of historical data and identifies parts for Kanban and projects potential savings. The simulate consumption and compute is on-hand inventory for each day. The simulation highlights the potential weakness in current replenishment methodologies. For historical data IOT identifies the potential inventory savings while it identifies the part shortages.
The Inventory Optimization Tool calculates average consumption, S/X ratio (variability of consumption) and safety stock, performs ‘what if’ analysis by varying lead times, lot sizes and service levels to get the optimal Kanban sizing. The inventory assessment tool highlights the gap between consumption and on hand inventory. Typically the Min-Max methodologies used by ERP systems with reorder points are the primary cause of excess inventory and material shortages. Since reorder points are not maintained they tend to go out of sync leading to higher inventory on-hand.
The system helps users visualize and quantify the variability of the actual consumption, provides a visual clue on the amount of inventory the company is carrying on-hand, then provides visual clues on the amount of safety stock is being carried. IOT quickly determines which parts are good candidates for kanban replenishment based on potential savings and (S/X, Std Deviation/Mean) variability of consumption.
Inventory Optimization Tool is Ultriva’s patent pending technology which uncovers opportunities to reduce inventory and identify parts for transition kanban replenishment. It also simulates changes in supplier lead time, lot size, and safety stock. Projects can be shared and categorized with other planners for viewing purposes.
Ultriva (www.ultriva.com) empowers leading industrial, automotive, healthcare, aerospace, and defense businesses to operate more effectively and collaboratively by providing real time visibility and targeted actionable intelligence into inventory and material flows. Ultriva’s cloud-based platform leverages and seamlessly integrates with leading ERP and MRP systems, to deliver an end to end pull based replenishment model for 21st century enterprises such as ATK, CareFusion, Emerson, Ingersoll Rand, McKesson, Magellan, Regal Beloit, Thermo Fisher and more. Ultriva is a privately held, growing software company based in Cupertino, California.