Exploitation of VMI information for production planning and inventory control
Abstract
Many manufacturers implement Vendor Managed Inventory (VMI) solutions with important customers and expect great benefits from the increased information visibility. However, after implementation the manufacturer finds that additional development steps are required to allow its internal operations to achieve further improvements. This paper describes a case where a supplier attempted to exploit VMI information in his production planning and inventory control (PIC) process. To do this a simple spreadsheet based Decision Support System (DSS) was created as an extension to the company’s ERP system. We found that the new VMI enabled information itself introduced no additional problems in the PIC process. However, the original issues where still present in the planning process. These issues led to the demise of the new automated replenishment process.