Overview

This MBA style course prepares and empowers you to calculate and control your Safety Stock. A crucial area of Inventory Management.The eternal question: How to balance the risk of stock-outs with the quantity of safety stock inventory held?...We cover 3 methods to calculate your Safety Stock - from super simple to advanced statistics:Method 1: Number of Days of Safety - A fast and very basic method to get a quick decision Method 2: HiHi-AvAv (my own name for a very established method ;) Finding the difference between our high "Lead Time Demand" and the average to determine the level of cover we want from periods of high demand during a slow replenishment lead time.Method 3: Statistical Method - The most rigorous method. We model our "Lead Time Demand" as a "Normal Distribution", determine our desired "Service Level" (acceptable risk of a stockout) and use a little help from some excel formulas to calculate our required Safety Stock and Re-Order Point quantity. Course Sections:1. Inventory Control Introduction 2. Safety Stock Background 3. Inventory Dynamics4. Simple Safety Stock Calculations5. Calculating Safety Stock using Statistics6. Getting Your Data 7. Assumptions and Limitations of the Statistical Method8. Fixed Lead Time, Variable Demand: Method 3 Continued9. Variable Lead Time and Demand: Method 3 Continued10. Choosing your Service Level - Your Tolerance for Risk11. Probability of a Stockout Over Time - Calculating Risk12. Optimizing Safety Stock Levels13. Conclusion14. Bonus and AppendixThis course is for dedicated operations manager, the ambitious procurement professionals, the striving logistics supervisors, hands-on production planners and the practical business optimization analysts. Remove the guesswork and add structure to your crucial safety stock decisions. Take control of your inventory management to have and "impact" and "improve" your business operations - manufacturing, services, industrial operations and production.Equip yourself to take a new leading role in your workplace - improving your processes, systems & business / organization.Quantify your risk, calculate your inventory requirements and articulate your method - removing the guesswork and fearful overstockingDownloadable Summary PDF Documents - throughout the courseAlmost all businesses have inventory: retail stores, factories, hospitals, hotels, car repair, warehousing, logistics and more - this means we all have to decide how much to hold and when to place an order from the suppliers for more. Place the order too late and, with a little extra demand than usual, you might stockout! Carry too much inventory and you pay for it in holding and financing costs every day, quietly sucking the profit from your business and crippling your cashflow and investment opportunities. Having enough stock available whilst minimising costs and risk is the fundamental balance that can determine your business's success. Getting a strong control and continuously improving your business operations is essential to remain competitive, improving profitability, improving customer experience and customer satisfaction, reducing costs and improving delivery.Without a solid grasp of safety stock and methods of calculation; no operations manager, can competently or confidently manage their risk without excessive costs. Be the one bringing clarity and structure to this most crucial decision! Specific Topics Covered in the Course:Why we need Safety StockConsequences of StockoutsCosts of InventoryInventory DynamicsQuick Calculations of Safety StockRigorous Statistical Method to calculate Safety StockHow to Model your "Lead Time Demand"How to Determine your own desired "Service Level"What the Probability of having a Stockout in a given period of timeHow we can Reduce our Need for Safety StockAlternatives to holding Safety StockTake control! Boost your career and your business! Start learning today! FULL COURSE CONTENTS:Inventory Control Introduction 1. Benefits of Good Safety Stock Inventory Management2. Bond's Lobster Story3. What is Safety Stock - Why do we Need Buffer Stock?4. Much Obliged!Safety Stock Background 5. Supply Chain Trade Offs - Risk and Consequences of Stock-outs6. Supply Chain Trade Offs - Costs of InventoryInventory Dynamics7. Basic Inventory Dynamics - Introduction8. Basic Inventory Dynamics - Sawtooth9. Re-Order Point and Alternatives10. Purchasing Order Quantity Choices11. How much Safety Stock? - Procurement's Problem QuestionSimple Safety Stock Calculations12. Safety Stock Calculations - Introduction13. Method 1: Simple Inventory Control Formula: # Days of Safety14. Method 1: Practice Question: # Days of Safety15. Method 2: HiHi-AvAv - Protecting Against the Worst Case16. Method 2: HiHi-AvAv - Explanation17. Method 2: HiHi-AvAv - Practice 1 & Answer18. Method 2: HiHi-AvAv - Practice 219. Method 2: HiHi-AvAv - Practice 2 - 2nd round20. Method 2: HiHi-AvAv - SummaryCalculating Safety Stock: Method 3: Statistical Method21. Service Level and Statistical Distributions22. Introduction to the Statistical Method23. Service Levels and Statistical Variation24. Normal Distribution Modelling25. Service Level Definition26. Statistical Method - High Level Overview27. Jumping Ahead - A quick look28. Need to Refresh your Probability Knowledge?29. Normal Distribution Introduction30. Normal Distributions and Standard Deviations31. Lead Time Demand as a Normal Distribution32. Representing Service Level on the Bell Curve33. Steps Overview34. How Many Standard Deviations of Safety Stock35. Intermediate Practice Question36. Safety Stock in Retail - Example 237. Alternative Formula =norm.inv()38. Working Backwards to find your Service LevelGetting Your Data39. Getting your Data - Introduction40. Finding the "Mean" and "Standard Deviation" from your DataAssumptions and Limitations of the Statistical Method41. Assumptions and Limitations of Method 3Fixed Lead Time, Variable Demand: Method 3 Continued42. Different Input Data- Introduction43. Calculating Safety Stock: Fixed Lead Time, Variable Demand44. Calculating Safety Stock: Fixed Lead Time, Variable Demand - ExampleVariable Lead Time and Demand: Method 3 Continued45. Variable Lead Time and Demand - Method and Example46. Variable Lead Time and Demand - Question and Answer47. Rounding Up or Down?… - Costs $60k!48. Which Formula to Use? SummaryChoosing your Service Level - Your Tolerance for Risk49. Choosing your Service Level - Introduction50. Service Level Definition: Recap51. What Factors should Influence how "Safe" we want to be??52. Marginal Analysis - Choosing your Service Level53. Marginal Analysis - ExampleProbability of a Stockout Over Time - Calculating Risk54. What's the Probability of a Stockout? - Introduction55. What's the Probability of a Stockout? - Excel ToolOptimizing Safety Stock Levels56. When to Review and Optimize your Safety Stock57. Reducing the Need for Purchasing Safety Stock58. Demand Management to Reduce Safety Stock59. Lead Time Management to Reduce Safety Stock60. Alternatives to Safety Stock - Other ActionsConclusion61. Wrap Up62. ConclusionBonus and Appendix63. What's Next- Further Reading64. My Other Courses65. How to Get Your Certificate66. Hide Your Nuts!My goodness did you read allllll that?! Time to get to the videos! :)See you on the inside! Laurence

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