Book on How to Use Lean and Reorder Point Planning

Lean and Reorder Point Planning: Implementing the Approach the Right Way in Software

What This Book Covers

A Lost Art of Reorder Point Setting?

  • Setting a re-order point is a bit of a lost art as company after company over-rely upon advanced supply planning methods to create the supply plan.
  • Proponents of Lean are often in companies trying to get a movement to Lean. However, how does one implement Lean in software? The re-order point is one of the significant methods.

Implementing Lean in Software

Unknown to many, all supply planning applications have “Lean” controls built within them. And there are, in fact, some situations where re-order points will provide superior output. With supply planning, even within a single company, it is not one size fits all. The trick is understanding when to deploy each of the approaches available in the software that companies already own.

Are Reorder Points Too Simple?

Re-order points are often considered to be simplistic, but under the exact circumstances, they work quite well.

There are simply a significant number of misunderstandings regarding re-order points – misunderstandings that this book helps clear up.

Rather than “picking aside,” this book shows the advantages and disadvantages of each.

  • Understand the Lean Versus the MRP debate.
  • How Lean relates to re-order point.
  • Understand when to use a re-order point.
  • When to use re-order points versus MRP.
  • The relationship between forecastability and re-order points.
  • How to mix Lean/re-order points and MRP to more efficiently perform supply planning.

A Book Based in Reality

The book provides many examples from real-life project experiences, the emphasis being on the reality of supply planning projects.

Interconnected to Web Information

In order the keep the book at a manageable and easily readable length, the book also provides numerous links out to the Brightwork Research & Analysis site, where supporting articles allow readers to get into more detail on topics that interest them.

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  • Chapter 1: Introduction
  • Chapter 2: The Lean versus MRP Debate.
  • Chapter 3: Where Supply Planning Fits Within The Supply Plan
  • Chapter 4: Reorder Point Planning
  • Chapter 5: Lean Planning.
  • Chapter 6: Where Lean and the Reorder Point are Applicable
  • Chapter 7: Determining When to use Lean Versus MRP
  • Chapter 8: Mixing Lean and Reorder Points with MRP-Type Planning

Table of Contents

Chapter 1: Introduction

  • The Methods Available for Supply Planning
  • Books and Other Publications on Lean Reorder Points
  • The Use of ScreenShots in the Book
  • Timing Field Definitions Identification
  • How Writing Bias Is Controlled at SCM Focus and SCM Focus Press
  • The Approach to the Book
  • The SCM Focus Site
  • Intended Audience
  • Abbreviations
  • Corrections

Chapter 2: The Lean Versus MRP Debate

  • Are Reorder Points Always Simplistic?
  • Academic Versus Practitioner Views on Reorder Point Planning
  • Conclusion

Chapter 3: Where Supply Planning Fits Within the Supply Plan

  • The Basic Nature of the Supply Chain Planning Functionality in ERP Systems
  • How ERP and APS Share the Planning Work
  • Critical versus Non-critical Materials
  • Dependent Demand Products
  • Alternative Design
  • Where a Product Location Combination is “Planned”
  • Conclusion

Chapter 4: Reorder Point Planning

  • Re-order Points in Their Essence
  • Introduction to Economic Order Quantity
  • Validity and Applicability of EOQ
  • Using Economic Order Quantity in Systems
  • Economic Order Quantity and Forecast Error
  • EOQ and Quantity Discounts
  • EOQ and Perishability
  • EOQ and Production Planning
  • Background on Reorder Point Planning in SAP
  • Re-order Point Planning in SAP ERP
  • Sum (Safety Stock + Expected Average Consumption for the Replenishment Lead Time)
  • Manual or Externally Calculated Reorder Point Planning in SAP ERP
  • Automatic Reorder Point in SAP ERP
  • Conclusion

Chapter 5: Lean Planning

  • Where Did Lean Come From?
  • The Big Lean Trend
  • The Honesty of How Lean is Presented
  • Different Types of Manufacturing
  • The Blast Furnace
  • Textiles
  • The Lean Focus of This Book
  • Conclusion

Chapter 6: Where Lean and Reorder Points Are Applicable

  • When to Use Reorder Point Planning
  • Re-order Point Planning for Deployment/Outbound Supply Planning
  • Conclusion

CHAPTER 7: Determining When to Use Lean Versus MRP

  • Differentiating Planning From Physical
  • MRP and Forecastability
  • Product Proliferation
  • Promotions
  • Determining Forecastability
  • Examples of Unforecastable Demand
  • Managing Products With No Forecast With Supply Planning
  • The Concept of Coding a Product Location Database
  • Master Data Review Cycle
  • Conclusion

Chapter 8: Mixing Lean and Reorder Point MRP Type Planning

  • Background on the Configuration of Multiple Supply Planning Methods
  • Steps to Creating the Product-Location Spreadsheet/Database

Appendix A: When Reorder Points are Forecast Based Replenishment
Appendix B: Inventory Parameter Calculation with 3S

  • The Conceptual Underpinnings of 3S
  • The Process
  • How S3 Output Is Updated
  • Net Change Parameter Updating

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Questions about the Book?

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