An Operational Approach for Order Planning
Servigistics K-Curve Cycle Stock provides an operational approach to determine order quantity for order planning by developing an optimal ABC classification of parts by order frequency, including annual usage, part/pair cost and order frequency sets. The software enables simulations to evaluate trade-offs between cycle stock and workload handling costs for various sets of order frequencies. Overall performance metrics, workload and inventory are used to set goals from which order frequencies are derived. An optimal exchange curve (workload vs. inventory) is then calculated, which enables the management decision on the system operating point.
Servigistics K-Curve Cycle Stock: Features and Benefits
Derives a simple, systematic approach to evaluate order frequency classifications
Allows for optimal classification, resulting in minimum cycle stock inventory for a given capacity to handle workload
Indicates 10-15% inventory savings in simulations by increasing to a 7-set order frequency from a standard, traditional 3-set
Supports scenario management