Background

Maintaining and improving on customer service levels, while reducing and optimising inventory levels was a key requirement for our client. The client also faced the following challenges:

• Non standard, decentralised inventory planning processes
• Out-dated inventory management systems
• Cumbersome inventory analysis tools

Challenge

• Build a business case for implementing an advanced inventory management solution (AIMS)
• Educate inventory planners in best practice demand and replenishment planning processes
• Develop a concept for standardising inventory planning processes
• Improve inventory analysis ability, efficiency and accuracy
• Develop relevant inventory performance measures based on consistent data definitions.

Approach

A project was commissioned with GRA to:

• pilot an advanced inventory management system (AIMS)
• cleanse and define key planning data inputs
• educate and train the business in best practice demand and replenishment planning processes
• develop and pilot a standardised demand and replenishment planning concept with the AIMS
• setup, train and pilot inventory analysis tools using the AIMS
• define and measure consistent inventory performance metrics throughout the course of the pilot.

Outcome

• Overall 14% reduction in excess inventory for all pilot stocking locations in only 3 weeks
• One of the stocking locations in the pilot had an excess inventory reduction of 33%
• Up to 30% improvement in stock turns
• No negative impact on customer service
• Lower projected stock-outs
• Improved process discipline and understanding for those involved in pilot
• Best-practice process education in demand and replenishment planning for those involved in pilot
• Positive user experience, with users not wanting to go back to the previous inventory management system
• A significant business case was demonstrated with the client proceeding with implementing the AIMS.