6 Sub-dimensions · Click to expand L2 detailClic para expandir detalle L2
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› L2N2
L2 · Inventory Policy & Segmentation
ABC-XYZ segmentation, safety stock calculation, EOQ & ROP, inventory reduction programs, and SLOB management.
The policy layer of inventory management — designing the rules that determine how much to hold of each SKU, when to replenish, and how to eliminate the inventory that is no longer earning its cost of capital.
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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ABC-XYZ segmentation & differentiated inventory policies
Combining value classification (ABC) and demand variability (XYZ) to design differentiated stocking policies — high SS for AZ where most stockouts concentrate, consignment for CZ.
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Safety stock calculation & service level optimization
The correct SS formula and the exponential cost-service curve that makes the trade-off explicit. Covers dynamic recalibration and differentiated service level targets by segment and channel.
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Reorder point, EOQ & replenishment parameters
When to order (ROP) and how much (EOQ), continuous vs. periodic review systems, and the impact of stale lead time parameters on simultaneous excess and shortage.
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Inventory reduction programs & working capital liberation
The 4 levers of inventory reduction structured as a program with fill rate protection and explicit financial quantification for the CFO.
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Slow-moving & obsolete (SLOB) inventory management
SLOB classification by aging and root cause, the 4 disposition options in sequence, and the preventive S&OP monitoring that stops new SLOB from forming.
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› L2N2
L2 · Multi-Echelon & Network Inventory
Multi-echelon optimization, DC replenishment models, in-transit visibility, seasonal pre-build, and VMI/consignment.
Inventory as a network asset — optimizing its position across all nodes simultaneously, coordinating replenishment flows, and managing collaborative inventory programs that reduce working capital on both sides.
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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Multi-echelon inventory optimization across the network
Simultaneous optimization across all network nodes. Covers the risk pooling effect, the 20–35% inventory reduction potential, and the centralization vs. lead time trade-off quantification.
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Distribution center inventory management & replenishment
Push vs. pull vs. hybrid replenishment models for DCs, cross-docking for high-velocity SKUs, and real-time DC inventory visibility that enables effective production coordination.
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Inventory in transit management & pipeline visibility
Managing in-transit stock (20–30% of total inventory for overseas sourcing). Covers ASN/EDI 856, carrier tracking integration, and MRP inclusion of confirmed pipeline supply.
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Seasonal & promotional inventory planning
Pre-build strategy for seasonal peaks and promotional events: when to start, how much to build, and how to manage the post-season SLOB risk.
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Consignment inventory & vendor-managed inventory (VMI)
VMI program design: data integration requirements, min/max calibration, bilateral benefits, and integrating VMI sell-out data into the S&OP as a demand source.
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› L2N2
L2 · Demand-Driven Replenishment
DDMRP methodology, kanban design, dynamic automated replenishment, omnichannel ATP, and retail POS inventory.
Moving from forecast-driven push to demand-signal-driven pull — the replenishment systems that reduce inventory while improving service by responding to actual consumption.
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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Demand-Driven MRP (DDMRP) methodology
The DDMRP framework: strategic buffer positioning, zone-based buffer sizing, dynamic adjustment, and how it simultaneously reduces inventory 20–40% while improving OTIF vs. classic MRP.
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Pull systems: kanban design & implementation
Kanban mechanics: production vs. transport kanbans, the number of cards formula, e-kanban for high-volume flows, and when kanban is not appropriate for high-variability demand.
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Dynamic replenishment & automated reorder systems
Rolling horizon parameter recalculation, exception-based adjustment, and fully automated PO generation for eligible categories with data quality prerequisites.
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Omnichannel inventory & available-to-promise (ATP)
Real-time ATP across channels with explicit prioritization rules, CTP for make-to-order, and the order management integration that prevents overselling.
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Retail & point-of-sale inventory management
In-stock rate as the true customer-facing metric, phantom inventory detection, and the VMI program at the retailer that eliminates the most frequent root cause of on-shelf stockouts.
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› L2N2
L2 · MRO & Critical Spares Inventory
Critical spares classification, RCM-inventory alignment, spare parts obsolescence, predictive maintenance integration, and MRO KPIs.
The inventory governed by the cost of downtime rather than the cost of capital — where the right policy question is not "what is the turnover?" but "what does an hour of equipment downtime cost?"
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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Critical spare parts classification & stocking policy
The criticality × lead time × failure probability matrix for spare parts — replacing ABC classification with a downtime-cost-driven framework.
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Reliability-centered maintenance (RCM) & inventory alignment
Connecting the RCM maintenance program to the spare parts catalog: PM-driven replenishment and CMMS-inventory integration.
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Spare parts obsolescence & lifecycle management
Equipment lifecycle → spare parts lifecycle: proactive OEM end-of-support monitoring, last-time-buy ROI analysis, and the equipment retirement process.
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Condition-based inventory & predictive maintenance integration
How PdM sensor data converts static safety stock into dynamic condition-triggered purchasing — reducing spare parts inventory 30–60% without increasing downtime risk.
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MRO inventory KPIs & cost management
The 3-dimension MRO KPI framework (availability, cost, quality), Total Cost of MRO including downtime cost, and the joint procurement-maintenance review.
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› L2N2
L2 · Inventory Analytics & Technology
Inventory KPI dashboards, AI/ML for forecasting, WMS accuracy, IoT & RFID digitalization, and inventory financing.
The data and technology stack that converts inventory from a cost to manage into an asset to optimize — from real-time WMS accuracy to AI-driven forecasting and the financial metrics that connect to the P&L.
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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Inventory KPI dashboard & reporting framework
The 3-level reporting framework (operational, tactical, strategic) and the financial translation that connects DIO and OTIF to the CFO’s language.
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AI & ML for inventory forecasting & optimization
ML applications in demand forecasting and parameter optimization — data quality prerequisites, realistic MAPE improvement benchmarks, and inventory capital reduction.
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WMS & inventory accuracy in the warehouse
The enemies of inventory accuracy, cycle counting program design by ABC segment, and the root cause elimination process that makes improvement structural.
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Inventory digitalization: IoT, RFID & smart shelves
RFID for warehouse and retail counting, IoT weight-based shelf sensing, and computer vision — with ROI analysis for each technology.
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Inventory financing: working capital & supply chain finance
DIO, CCC, and ROCE as the financial metrics of inventory management — and how to present the inventory-capital trade-off in the language of the CFO.
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› L2N2
L2 · Inventory Governance & Organization
S&OP integration, cycle counting programs, organizational roles & incentives, write-off management, and benchmarking.
The governance framework that makes inventory decisions explicit, accountable, and continuously improving — from the monthly S&OP to the organizational design that aligns incentives with working capital targets.
L3 Sub-componentsSubcomponentes L3 5 items · click to explore elementos · clic para explorar
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S&OP integration: inventory in the monthly planning cycle
Embedding inventory decisions in the S&OP — quantifying the service-capital trade-off, integrating the seasonal pre-build, and connecting inventory to the IBP financial bridge.
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Inventory accuracy program & cycle counting
Designing the cycle counting program (frequency by value segment, discrepancy investigation protocol) and the root cause elimination that converts corrections into structural improvements.
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Inventory organization: roles, responsibilities & incentives
Defining inventory management roles, the DIO accountability structure, and the incentive alignment challenge that production and sales efficiency metrics create.
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Inventory write-off management & financial reconciliation
The formal write-off process, write-off as a health indicator, and the prevention rate that measures if SLOB detection is happening early enough to recover value.
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Inventory benchmarking & continuous improvement program
Industry DIO benchmarks by sector, the 3-year PDCA-based improvement program, and prioritizing initiatives by financial impact rather than implementation ease.
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