POM Inventory Optimizer is a software system that optimizes inventory levels based on the most up to date scientific results from stochastic inventory theory.
Based on transactional data from a materials management system, POM Inventory Optimizer uses sophisticated methods that
- analyze the demand time series for each SKU
- forecast the demand during the upcoming risk period
- computes optimum inventory levels (safe stock)
In this way, POM Inventory Optimizer can be used to significantly improve service levels and/or reduce inventory levels.
POM Inventory Optimizer implements sophisticated forecasting techniques (including automatic selection of tha forecasting method) al well as inventory policies, such as the base-stock policy, the (s,q)-, the (r,S)- or the (s,S)-policy. Optimum policy parameters are computed with respect to a target service level, depending on the characteristics of the probability distribution of the demand. Besides normally distributed demands, also gamma demands and any empirically distributed demands are supported. Special emphasis is put on instationary, i.e. dynamic demand behavior.
POM Inventory Optimizer avoids several severe flaws that a present in a number of other inventory management tools.
Inventory Management in Supply Networks, Norderstedt, Germany (Books on Demand) 2006