But some of these messages can be considered as nothing more than nervousness. While it might be important to increase or decrease quantities to match the change in demand, an expedite or a defer message, of less than 2 or 3 days, may not be a business requirement, or may be viewed as just nervousness of the system. Not a good thing.
Defer and Expedite.
What is defer and expedite anyway? How important is that?
Defer means the order isn't needed as soon as originally planned, that it can be delayed (deferred) for a time. Perhaps some safety stock inventory has been completed or there has been a return and the supply order isn’t needed as early as originally projected. If the supply comes in as planned, can the excess inventory be carried until the day of the requirement?
Expedite is when the inventory is not meeting requirements and that future order is needed sooner than expected. How long can the item be on back order and still meet client expectations for quick delivery?
When the business requirements permit, then the system nervousness can be reduced by delaying the replenishment for a period of time or by carrying the inventory for a time.
The JD Edwards EnterpriseOne Requirements Planning system has Damper Days just for this purpose. Setting a damper day value in the R3482/R3483 processing options, allows the planning engine to only create a defer or expedite message when the change is greater than the damper days. Is it OK to back order an item for 2 or 3 days, but not more? Then set the expedite damper days to the number of days that reduces nervousness, but does not impact meeting customer expectations.
Is it OK to carry 4 or more days of inventory so that orders are not rescheduled to later dates? Then set the defer damper days to a number of days that an order can come in early to reduce nervousness without a great inventory holding cost.
When balancing the planning data setup, assigning the item lead times, safety stock levels, and min max multiples, you can also consider the planning damper days as another tool in the toolbox to reduce the system nervousness and help those planners focus on the real issues for the day.
Are you using Damper Days to reduce nervousness? If so, would you ever go back to not using Damper Days? If you are not, does this sound like an option in your business? Why or Why not?
I encourage you to discuss, what are you doing in your business to reduce nervousness?