I have to warn you, the following blog post contains satirical elements. Do not feel offended if your company has an ERP system in its portfolio. I certainly am not referring to your particular ERP system, which is probably very good, with powerful specific ERP functions and shiny buttons. Nevertheless, you will have to admit that there are limitations to its use and that is exactly what this blog post is about.
For all ERP users out there: there are two ways to conduct inventory management – the wrong way and the right way:
Wrong
Starting the ERP client on your computer, the gate into a Kafkaesque hell is opened: Grey and “pragmatic” interfaces, filled with a never-ending cascade of lists, navigated to by functions with silly abbreviations. You remember the day your supervisor introduced you to your daily companion. “It is very easy, if you know where to look.” Today you wonder why it is 2015 and computer programs are even allowed to look and work like this.
You start your daily routine by opening the first article (having been the first on an alphanumerically sorted list). Seems okay, you move on. You repeat that over and over until you come across an article which really needs your attention. Sometimes a wave of excitement rushes through you when this happens, after half an hour of pointless, monotonous clicking.
Your excitement vanishes the moment you realize that you cannot even solve the problem: a typical stock out situation, calling for an expensive express delivery. Once more you underestimated the demand for that particular article. “Let’s buy some more in the future,” you think, pushing away all thoughts about the consequences, if your assumption fails reality. The next article is quite the opposite from a stock out, a pile of probably not saleable junk, ordered under the impression of a singular demand rush. Your supervisor will not be happy about this. And so you move between non-solvable problems and solvable routine, for which you wonder, why you are even needed. And what about all those other guys who do the same job as you in this department? This whole team could not avoid the fact that your company has a paradox problem of excess stock and mediocre service levels.
While wondering about your next review meeting and your job in general, your ERP system just sits there and watches you in brooding silence. “Hey, that’s not my fault, not my job,” it seems to yell at you.
Right
Starting the client of your planning tool which is an add-on to your ERP system, your attention is immediately directed to some critical situations. Among them are upcoming stock out situations which you prevent by accepting the order proposals provided by the system. You remember the day, when your supervisor showed you the new system: “This application will do most of your former routine tasks. But don’t worry, I need your experience for the really tricky ones.”
So instead of being overwhelmed by monotonous work that questions your whole training, you focus on strategic tasks like evaluating service levels for important items, adapting forecast parameters or executing simulations for future developments.
And the system does not leave you hanging with the especially “tricky” items. Precise forecasts based on the item specific demand structure and already optimized order positions for each article prepare the field for you to put your experience to good use and solve the problem.
In the end, your company achieves high service levels, while at the same time keeping stock levels low. But from your perspective the most important benefit is: you moved from being just a “clicker” to a real inventory manager.
Conclusion
Use an ERP add-on to optimally manage your inventory levels. Sometimes it is as simple as that.
