tag:blogger.com,1999:blog-5508930181869660836.post762836967692172867..comments2023-08-25T04:17:35.884-05:00Comments on Turning 'Gee-Whiz' Into R.O.I.: Simpler is better: Dynamic Buffer Management (DBM)RDCushinghttp://www.blogger.com/profile/14475391800597059330noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-5508930181869660836.post-72984538328429284332017-07-18T17:10:18.616-05:002017-07-18T17:10:18.616-05:00Sorry. You're reading a really old post. Stand...Sorry. You're reading a really old post. Standard DBM has been supplanted by the much superior DDMRP (Demand Driven Material Requirements Planning. You can read about it here: http://www.rklesolutions.com/?s=ddmrp <br /><br />And, yes, it does hand seasonality and planned adjustment factors, as you ask.<br /><br />Grace to you,<br />Richard CushingRDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-43726286255369159372017-07-17T23:36:40.399-05:002017-07-17T23:36:40.399-05:00Hi,
Excellent post. But I want to make sure wheth...Hi,<br /><br />Excellent post. But I want to make sure whether the TOC model would work in the following situations:<br />1. Where there is seasonal falctuation<br />2. In times of Festival( for eg. fashion house during christmas).<br /><br />If it works could you please explain it in a detail?<br /><br />Thanks.Anonymoushttps://www.blogger.com/profile/04246513486705897720noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-85372819244933503662014-02-18T07:32:43.488-06:002014-02-18T07:32:43.488-06:00Filipe:
We actually do work with firms in a consu...Filipe:<br /><br />We actually do work with firms in a consulting role to help them overcome traditional practices and metrics based on local optima.<br /><br />Our general approach is to use the Thinking Process tools to help the organization and management get a different view of how the firm works--and fails to work--effectively at producing higher profits.<br /><br />Next, we work with them RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-65011408978538680792014-02-18T07:32:42.633-06:002014-02-18T07:32:42.633-06:00Filipe:
We actually do work with firms in a consu...Filipe:<br /><br />We actually do work with firms in a consulting role to help them overcome traditional practices and metrics based on local optima.<br /><br />Our general approach is to use the Thinking Process tools to help the organization and management get a different view of how the firm works--and fails to work--effectively at producing higher profits.<br /><br />Next, we work with them RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-76996760359906610762014-02-07T12:20:19.932-06:002014-02-07T12:20:19.932-06:00Hello RDCushioning
Thank you for clarify that.
I...Hello RDCushioning<br /><br />Thank you for clarify that.<br /><br />In fact, my goal (and hope) is to increase replenishment frequency in all supply chain and therefore, obtain shorter replenishment cycles and focus on availability of our products for costumers and consumers. I want to know if you can help me to overcome traditional production practices of increasing production batches to reduceAnonymoushttps://www.blogger.com/profile/05526860284750855314noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-1402007201945301902014-02-02T20:56:10.013-06:002014-02-02T20:56:10.013-06:00Filipe, thank you for your cogent comment.
Actual...Filipe, thank you for your cogent comment.<br /><br />Actually, I probably oversimplified when I made my earlier comment regarding shelf-life. Naturally, you would never want a single replenishment order (which is likely to have a single expiration date) larger than average daily demand times shelf-life days.<br /><br />However, the real objective of DBM is to drive toward shorter and shorter RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-91687967350985612672014-02-02T10:43:16.686-06:002014-02-02T10:43:16.686-06:00Hello
Excellent discussion. Shelf life is an impo...Hello<br /><br />Excellent discussion. Shelf life is an important issue to resolve in food industory.<br /><br />I have just one thing to clarify. The formula you gave (AvgDailyDemand * ShelfLifeInDays) have to consider all stock allocation + transit?. <br />I mean, all supply chain inventory of one specific item, should not to be greater than this amount?. Is that right if I have my products Anonymoushttps://www.blogger.com/profile/05526860284750855314noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-76889211843975051602013-01-15T11:00:23.458-06:002013-01-15T11:00:23.458-06:00Maxim:
That is an excellent question.
Typically,...Maxim:<br /><br />That is an excellent question.<br /><br />Typically, one would never want to have more than AvgDailyDemand * ShelfLifeInDays in stock. There are exceptions to this basic rule, however.<br /><br />For example, if this is a very high Throughput item (where Throughput is Revenue less Truly Variable Costs per unit), the profit may make it worthwhile to take some risk by stocking RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-9428999043699791662013-01-15T10:43:53.685-06:002013-01-15T10:43:53.685-06:00Dear Richard
Could you please advise how the shel...Dear Richard<br /><br />Could you please advise how the shelf life is to be considered in DBF?<br /><br />Thanks<br />MaximAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-42243083776352091192011-09-23T18:30:55.417-05:002011-09-23T18:30:55.417-05:00You should consider any quantity that will be rece...You should consider any quantity that will be received within one replenishment period in the buffer. For example, if your replenishment period were 90 days because you ordered items from the Pacific Rim, you would want to include in your buffer calculation any quantity that is already on a ship and would become part of your on-hand quantity within the 90-day period.<br /><br />Run a simulation RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-43562279770028383352011-09-23T10:42:41.839-05:002011-09-23T10:42:41.839-05:00Thank you Richard for your two responses,
i´m sti...Thank you Richard for your two responses, <br />i´m still finding hard to understand why to consider on transit qty. as part of the buffer too, so then should i also consider as part of the buffer the qty. in production that has been ordered but still not delivered?<br />In other words, qty. in process + on-transit + on-hand should be the total buffer to consider in DBM?Rafael Cereceronoreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-12399420167712227182011-09-22T18:08:15.962-05:002011-09-22T18:08:15.962-05:00Ralph:
Also, as part of your processing, don'...Ralph:<br /><br />Also, as part of your processing, don't forget to include "cooling-off periods" after any change in the buffer size. For INCREASES in the buffer size, the cooling-off period should be at least one full replenishment cycle.<br /><br />For DECREASES in the buffer size, no change should occur in the buffer size until the buffer quantity falls to the "green"RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-74980860849923309522011-09-22T17:51:59.752-05:002011-09-22T17:51:59.752-05:00Ralph:
I think you will resolve your problem with...Ralph:<br /><br />I think you will resolve your problem with regard to the one-day replenishment time if you will do what I did NOT cover in the article. That is, the size of your buffer should include the quantity on-hand PLUS the quantity in-transit.<br /><br />Let’s say your present buffer size is 500, including 300 on-hand and 200 in-transit (arriving the next day). Now, let’s also say that RDCushinghttps://www.blogger.com/profile/14475391800597059330noreply@blogger.comtag:blogger.com,1999:blog-5508930181869660836.post-50271878276419439112011-09-22T17:17:43.975-05:002011-09-22T17:17:43.975-05:00Hello Richard,
excellent example, and very descrip...Hello Richard,<br />excellent example, and very descriptive.<br /><br />I am currently programming an excel file to do exactly this DBM process, for a coupe of thousands items. The algorithm is basically the same as you describe. However in this example your leadtime or replenish time is one period (day i imagine), what you order, arrives the very next day. In my case the leadtime is more than Ralph Cereceronoreply@blogger.com