Oracle Inventory Optimization Users Guide

Contents

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Preface

Overview

Overview of Oracle Inventory Optimization

Stochastic Optimization Technology

Business Process

Key Inventory Decisions

Input

Output

BIS Key Performance Indicators

Defining an Inventory Plan

Running an Inventory Plan

Copying an Inventory Plan

Sourcing

Manage Inventory Levels

Inventory Plan Options

Plan Options Overview

Plan Options

Setups

Planned Items: ABC Classification

Selecting Planned Items

The Main Tabbed Region

Plan Start Date in Future

Plan End Date

The Organizations Tabbed Region

Using an Existing Plan as a Demand Schedule For a New Plan

Setting Demand Variability

Cumulative Demand Distribution

How Probability Data is Used by Oracle Inventory Optimization

Weighted Average Calculation

How to Assign Forecasts and Forecast Sets to Scenario Sets

Specifying Sources of Demand

The Constraints Tabbed Region

Service Level and Fulfillment Lead Time

Lead Time Variability

Inventory Budget

Key Setups

Setting Plan Level Default Service Level

Setting Plan Level Default Demand Fulfillment Lead Time

Service Level Set

Defining Service Level Sets

Understanding Group Service Level Targets

Determining Group Target Levels

Enforcing Service Levels With Enforce at Aggregate Level Enabled

Item Simulation Set

Defining Item Attribute Simulation Sets

Defining User-specified Safety Stock

Defining Budgets

Enforcing a Plan Option Budget Name or Value

Setting Default Lead Time Variability

Setting Up Manufacturing Lead Time Variability for a Plan

Setting Up Manufacturing Lead Time Variability for an Item

Setting Up In-Transit Lead Time Variability

Setting Up Supplier Lead Time Variability

Setting Penalty Costs

Setting Item Purchase Price by Supplier

Setting Performance Indicators

Setting Intermittent Demand

Viewing Output

Overview of Viewing Output

Queries

Creating Queries

Editing and Maintaining Queries

Executing Queries

Setting Queries Preferences

Performance Indicators

Time-phased Supply and Demand

Visibility to Forecast Variability

Viewing the Demand Fulfillment Lead Time

Safety Stock and Target Safety Stock

Safety Stock Analysis - Viewing the Plan

Resource Requirements

Material/Resource Availability

Reviewing Exception Messages

Analysis Workbench

Overview of Analysis Workbench

Analyzing Inventory Plans

Using the Analysis Workbench

Creating and Editing Preference Sets

Analyzing Service Level Versus Profit

Analyzing Postponement

Analyzing Safety Stocks

Analyzing Inventory Budgets

Analyzing Revenue and Cost Breakdown

Analyzing Service Level Breakdown

Managing Inventory and Safety Stock

Planning Safety Stock for Components and Co-products

Defining and Generating Safety Stock Levels

Safety Stock Inflation

Safety Stock Smoothing

Safety Stock Level Days of Supply

User-Specified Safety Stock

Oracle Inventory Optimization Policy Planning

Introduction to Policy Planning

Functional IO Components

Publishing Parts Classification

      Creating New Categories and Category Sets

Setting Up Policy Parameters

      Managing Policy Parameter Sets

      Specifying Policy Details in the Policy Parameters Set

      Importing Time Varying Policy Parameter Values

Loss Function Based Safety Stock Calculation Profile

      The Loss Function Based Calculation

IMM Inputs to Policy Planning

Policy Parameters Calculated by IO

Calculating Policy Parameters

      General Overview of Policy Parameter Calculations

      Calculating Safety Stock

Calculating Policy Parameter Details

      Calculation of Min or Re-Order Point (ROP)

      Calculation of Max

      Calculation of Order Quantity and Economic Order Quantity (EOQ)

      Examples of Calculating Policy Parameter Details

Viewing Calculated Policy Parameters in Material Plan

Oracle Inventory Optimization and Asset Intensive Planning

Introduction to Asset Intensive Planning

      Understanding the Asset Intensive Planning Process

Computing Total Demand

      Calculating Total Demand

      Modeling Repair Operations

eAM Activity Definition

      Rebuilding the T56 Engine Activity

      Item and Activity Identification

      Repair Lead Time

IMM Rebuild Activity

Managing Oracle Inventory Optimization Plans from Oracle Advanced Planning Command Center

Introduction to Managing Plans in Advanced Planning Command Center

Running a Quick Simulation

Copying Plans and Editing Inputs

      Copying a Plan

      Editing a Plan

      Working with Attributes

      Mass Editing

      Working with the Plan Options Screen

Launching Plans

      Plan Launch Parameters

APCC Measures for Inventory Analysis

Oracle Inventory Optimization Warehouse Capacity Constraints and Cycle Inventory Safety Stock

Oracle Inventory Optimization Warehouse Capacity Constraints

      Organization Level Constraints

      Order Quantity and Effects of Order Modifiers

      Accounting for Supply Variability in Warehouse Capacity Constraints

      Safety Stock Push Down to Downstream Locations

      Specifying Warehouse Capacity Level

      Specifying Safety Stock Days

      Defining Item Order Modifiers

      Specifying Order Period

      Specifying Inventory Days Increment

      Defining Warehouse Capacity at the Organization Level

      Defining Storage Capacity at the Category Level

      Defining Item Volume

      Specifying the Enforce Warehouse Capacity Constraints Plan Option

      Warehouse Capacity Exceeded Exception

      Pushing Warehouse Capacity Facts to APCC

Setting Up Warehouse Constraints

Accounting for Cycle Inventory in Safety Stock Calculation

Introduction to Accounting for Cycle Inventory in Safety Stock Calculation

Enabling Cycle Stock Functionality

Target Service Level De-rating

      De-rating Service Level in a Multi-echelon Case

Requirements Explosion De-rating

Service Parts Planning

Integration with Oracle Inventory Optimization

Cross-Product Integration

Integration with Demand Planning

Oracle Inventory Optimization and Intermittent Demand Attributes from Demand Planning

      Understanding Intermittent Demand Attributes from Demand Planning

      Receiving the Intermittency Flag from Demand Planning Data Flow

      Receiving the Intermittency Flag from Demand Planning Process

Profile Options

Profile Options Introduction

Special Considerations

Inventory Optimization Profile Options

Glossary

Index