CHRIS MOUSLEYIndependent Integrated Business PlannerSystems Integrator

ABOUT ME• Sydney Based Subject Matter Expert

• Business Statistics• Independent S&OP Reviews• Systems Integration• Process Improvement• Coder / Infrastructure• 15 Years Working Experience across IT / Supply Chain / Marketing Projects

• Client Focussed• Affordability• Tailored• Proven Results• Sustainable, constructive & actionable change

• Yet I’m Still Learning!• Marketing Masters Student @ CSU Bathurst• Complete N00B with public speaking

HISTORY

EVERY BUSINESS IS UNIQUE IN TERMS OF IT’S CHALLENGES!

LEARN AND RISE UP TO IT!

WHAT IS THE BARRIER TO SUCCESS IN YOUR BUSINESS?

TOPICS TODAY• Errors observed with assumptions with Flat safety time / Dynamic Safety

time models

• The Hierachy of Inventory Control

• Making your Inventory 'Work' for you and optimising the mix

PERSONAL INTERESTS• Music – Rock• Gaming• Cooking• Teaching• Volunteer work for not for profits

LET’S GO!!!!

WHY KEEP SAFETY STOCK??• Demand Volatility• Supply Volatility• Sourcing Changes• Logistics Delays or Penalty• Market advantage through availability• Because our boss told us too… (NO)• You can’t protect against every operational disaster

ERRORS OBSERVED – SAFETY STOCK

1. Flat Safety Stock is set to a multiple of the MOQ1. Why should you let your supplier set your Safety stock for you?

2. Safety Stock Set to the Stock required for the full lead time1. Again – why should you let your source dictate your Safety Stock?

3. No scheduled reviews of Safety stock scheduled?1. The min holding of stock will be forgotten. Are you going to remember what you did 3 months ago when there is

another supply issue aka FIRE to put out?

4. Setting a Min Safety Stock without a Max1. Planners!!! You need an alarm signal on both directions!

5. Letting your System ‘Ride’ and order simply what it needs.1. A Safety stock of Zero = Potential lost sales and unfulfilled sales2. Stairway to Heaven … The stock build!!!!!!!

ERRORS OBSERVED WITH DYNAMIC SAFETY TIME

• 1. A complicated, misunderstood calculation• IF you don’t understand how the number is generated.. What inputs it uses and challenge

the assumptions• 2. A simple rule – Every item gets 4 weeks

• Why should a frequently available item get the same treatment as a contract item with sporadic demand?

• 3. Blind trust in a forecast number that is unchallenged• Watch out for this one!!!!!

3. Good Assumptions to Quantify (Good Homework!)• What is my Actual lead time• What is my realistic supplier reliability• How many delivery delays have I had on item xyz• What is my Demand variability.

HIERACHY OF INVENTORY CONTROL

?SaleableRelevantValuable

AccessibleAccounted For

SecureSafeLegal

?• The mystery Box at the top of the pyramid is…• Inventory which appreciates in value?

• Who does this well?

• Answer = Fort Knox

OPTIMISING THE MIX• First… Get through the hierarchy of inventory control!!!

• Second - consider the ‘CORE BUSINESS’

• What sector is the core business in?• What do your larger accounts or customers expect you to have in stock…

EVERY DAY

• You can’t have it all.. The optimisation is known as a>>

BALANCING ACT

CostServiceProfitMarketRisk!!!!

Inventory = Cost = Risk

OPTIMISATION APPROACH• Stay relevant with your stock.• Conduct Range reviews regularly• Monitor NPD rigoursly.. And END OF LIFE!!!• Clear SLOW movers with a dedicated resource / team!• Identify high risk areas, such as security and ask your suppliers or

customers to help mitigate that risk with consignments / Forward open orders.

• Cut your losses!!

QUESTION TIME• What CAN I do better?• What CAN I teach you?• Would an Independent review help your business achieve it’s goals?

• Contact through LinkedIn• www.linkedin.com/in/cmousley

• 1 Question per week will be answered publicly without disclosure of where it was from.. For FREE.. I’ll let you know if it’s yours personally.