Setting global parameters for perpetual items

A basic analysis is performed if there are issues, or usage, on a few days. A more extensive simulation is performed when backed by additional data. In both cases, items with less than a certain minimum number of days of history are treated separately.

Use this procedure to specify global parameters for perpetual items.

  1. Sign in as Supply Management Administrator and select Inventory Intelligence > Configuration.
  2. Select the Perpetual Global tab.
  3. Specify this information:
    Lead Time Length Cutoff
    Specify the lead time in days. Lead time is the number of days between when an item is ordered and when it is received. If the lead time is too large, then a data error or an unusual situation is likely. Any value that is greater than or equal to the value in this field is excluded.
    Minimum Number Of Lead Time Values
    Specify the minimum number of lead time values. Lead time values refer to the lead time history for an item. For example, if an item is reordered 10 times, the number of days that occurred before each order was received is indicated by 10 separate values.

    When the lead time values for an item are too few, they are not a strong basis for recommendations. A minimum can be set to ensure that the item has enough of a lead time history for a useful recommendation.

    Default Lead Time
    Specify the default lead time in days. If the minimum number of lead time values is not reached, you can specify a default variability value to use for recommendations calculations.
    In Case Of Insufficient Lead Time History
    If the minimum number of lead time values is not reached, select the parameter from which the lead time for recommendations is drawn:
    • Use Default Lead Time: The value in the Default Lead Time field is used. We recommend this setting.
    • Use Item Location Lead Time: The lead time that is specified in Item Location is used.
    Include lead times before the last Primary Vendor change
    Select to include the lead time records before changing the primary vendor.
    Minimum On Hand Time Period Cutoff (Weeks)
    Specify the minimum on hand time period cutoff in weeks. Part of the analysis is completed over a large window of time. For example, 52 weeks. But the most recent period, for example 10 weeks of history, is important for determining the minimum amount that was on hand.
    Minimum Issue Days To Qualify For Analysis
    Specify a value for the minimum number of days an item must be used to qualify for analysis. The default value is 2 issue days. Items with issue days fewer than this value may be flagged as removal candidates.
    Minimum Issue Days To Qualify For Simulation
    Specify a value for the minimum number of days an item must be used to qualify for simulation.
    Minimum Days Of History
    Specify the minimum number of days the item must be in history to qualify for simulation. The default value is 182 days. Items with less than the value are considered new and are excluded from removal analysis.
    Reorder Point Offset (Units)
    Specify a reorder point offset value. Because an order is triggered when inventory reaches the Reorder Point, it is useful for the target to be at least 1 unit higher. This can be overridden.
    Floor Multiplier
    Specify a floor multiplier value. In Inventory Intelligence, floor refers to the second-highest demand level observed within the Analysis Window. We recommend that you keep the reorder point at or above a minimum floor value, calculated from historical data. Set the reorder point to 0 to disable. Leave it at 1 to use the calculated value. You can set it to a decimal value to adjust it more precisely. For example, 1.25 is 25% above the floor, 0.75 is 25% below the floor.