Why Right Sized Inventory

Better Science

  • Predictive Analytics for Correct, Comprehensive, Probabilistic Results

    Right Sized Inventory (RSI) is true predictive analytics – a correct, comprehensive, probabilistic Monte Carlo simulation of inventory, demand, supply and service level

  • Probabilistic Monte Carlo Simulation

    A predictive analysis of possibilities, risk and opportunity. Our MC Sim builds at least 2000 independent models of possible results by using a best-fit probability distribution for any factor-inherent uncertainty – such as future demand quantities and supply lead times. Each model uses a different set of random values for the factors with uncertainty. The 2000 (or more) model results form a range, or distribution, of possible outcomes – for RSI, the key outcome is inventory level, along with other critical KPIs. From this outcome distribution, RSI selects the optimal inventory level that will best meet your service-level requirements – without expediting!

  • Statistics Built to Handle Non-Normal Variation

    Right Sized Inventory (RSI) auto-selects the right statistics based on your item demand behavior to ensure the right amount of inventory and desired service level.

  • "Real World" Handling of Lead Time Variability

    Lead times are inconsistent. They vary. You don’t want to use a single, static, “worst case” assumption to represent lead time. RSI includes lead time variation as reality and incorporates that variation when determining the right amount of inventory.

  • Covers a Wide Variety of Replenishment Methods

    Choosing the right replenishment method – and potentially different replenishment methods for different items – is a critical element of optimizing your total inventory investment. No matter what you choose, RSI has you covered: MRP, Re-order Point, Min-Max, 2-bin Kanban and multi-card Kanban. Diversity can be powerful in replenishment planning but requires a powerful tool to execute.

  • Considers Replenishment Interval as Essential Factor

    If you replenish inventory weekly, you don’t need as much as you do if you replenish monthly. Pretty simple if you say it like that. Yet it’s surprising how many inventory calculation methods and formulas don’t correctly incorporate replenishment interval.

  • Cancelled Orders vs. Backlog

    You can reasonably estimate the probability that unfulfilled demand is cancelled or becomes past-due backlog. Backlog is better for revenue – assuming you can catch up. But it can also be disruptive, compounding order fulfillment pressure and requiring more inventory to compensate. This reality is included in an RSI determination of “right sized” inventory.

  • Cost and Ease of Expediting

    If you can expedite easily from a given supplier, you can get away with leaner inventory. On the other hand, more inventory is a sound safeguard when expediting is impractical or cost-prohibitive. Handle with care, but this reality is another important real world factor considered in the RSI analysis.

  • Service Level Driven

    If you – and your customers – need high-level assurance that you can service customers’ needs, you may need to plan for a higher inventory level. It’s an obvious, basic requirement, yet tricky to incorporate in calculations. RSI ensures this critically important factor is accurately included to preserve your required level of order fulfillment reliability.

Better Value

  • A Better Solution Delivers Better Results

    This may sound like it belongs in the “Better Science” side, but it’s here because of the financial benefits you’ll get from using RSI. Ideally, you want the minimum amount of required inventory to consistently achieve the customer service levels you need. We’re built to specialize in that mission.

  • Just What You Need - No More

    We kept RSI skinny on purpose. This strategy reduced our development cost which in turn keeps the price down. Our competition will say they do more. OK, but why pay much more for a broader platform if you really just want the best inventory planning tool out there?

  • Less time required by skilled analysts

    A great analyst is invaluable – in many ways. RSI enables these highly skilled resources to spend much less time planning inventory requirements. If they’re relying on spreadsheets today, give them a nail gun instead of a hammer. Free up that time to be used in one of the many other ways a great analyst can deliver value.

  • Cloud Architecture

    This story has been told. But it’s just as relevant today as ever. Due to the way it’s built, RSI deploys within days and requires no investment in hardware or other IT infrastructure. In addition, because RSI is a cloud solution, the pace of innovation is quicker and easily deployed – all at no additional cost to you.

  • Focused Services Expertise - If You Need It

    Our goal is to radically improve your inventory planning capability. We’re excited for you if you can accomplish that with our technology and no additional help. If you need help, we have a team of seasoned experts who can be in and out quick to keep your cost down. As with the development cost argument above, this works because the value proposition is narrow so we’ve gotten really good at it.

  • Why Wait?

    You can get results to begin right sizing your inventory today. There is no deployment period. The hardest thing you’ll have to do is extract data from your system of record. As soon as you can get that done, you can begin getting results. Our RSI analytical engine is ready and waiting.