Advanced inventory management (AIM)

There is increasing pressure to reduce the costs of managing supply chains. A major part of these costs originates from stock keeping. Hence, reducing inventory while maintaining or even enhancing service levels is one of the first things to assess when trying to optimize supply chains. Although most ERP systems allow various inventory policies and replenishment strategies, these systems do not set these policies automatically. As part of this project we are developing the Advanced Inventory Manager (AIM) tool that, by analyzing an inventory, classifies the products and calculates buffer stock levels, reorder points, and batch sizes for every product in a warehouse. Research areas include multi-echelon inventory optimization as well as calculation schemes for computing buffer stocks in extreme cases, i.e. when one is not dealing with distributions close to a normal distribution or a Poisson distribution (this situation often occurs, e.g., in the spare parts business).