Re: Safety stock

What makes sense & is practical varies with BPCS version. We're 405 CD.

It also varies with our understanding of ERP theory, and the needs of our
company.



Over the years, our inventory accuracy has improved, thanks to a variety of
actions, more management directed than within BPCS, but we will never be
satisfied until our inventory is 100% accurate, we have no past due, our
total inventory $ value seems reasonable, and Cost of Sales seems to agree
with management expectations. None of those are true yet.



Some years ago, upper management speculated that a possible cause of
inventory inaccuracy might be scrap under-reported, and a possible solution
would be to add a 2% yield (change 100% yield to 102%) for certain purchased
material classes. Over time the % and classes have changed. It is now 8%
in 4 classes. I have programs for mass updates, so that when management
policies change, they can be rapidly implemented.



The impact is to consume more inventory via labor back flushing than the BOM
calls for, increase what we need to order from our vendors, increase both
standard cost rolled up and actual cost of what BPCS consumes..

.

In my opinion, this has nothing to do with safety stock.



Al Mac = Alister William Macintyre

-----Original Message-----
From: bpcs-l-bounces@xxxxxxxxxxxx [mailto:bpcs-l-bounces@xxxxxxxxxxxx] On
Behalf Of Lee Dixon
Sent: Thursday, February 13, 2014 9:48 AM
To: BPCS ERP System
Subject: [BPCS-L] Safety stock



I have a notion that I can use the yield factor to build safety stocks! Does
this sound far fetched. It looks like if I do this everything will still be
cost properly and back flushed ok. What's the danger?



RD