Making the Most Effective Use of Inventory Data
The Service | Capital dimension of the River Rock Advisors 3D-Ops Model℠ analyzes how to best balance inventory working capital and service levels to meet operational strategy as well as prioritize initiatives to both address service levels and reduce overall inventory levels — all while driving efficiency and remaining resilient to disruptions.
We often find that companies use rules-of-thumb or category-based inventory planning processes. However, these one-size-fits-all approaches can create an mix problem with too much of the wrong inventory and not enough of the right inventory.
The goal is to get to item-level supply/demand attributes in order to move to item-specific inventory targets, significantly improving inventory productivity. Through this, companies can move from getting on the appropriate service-inventory curve, to defining the best balance to being in position to shift the curve to maximize business impact.
