Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

12.1.3 Scheduling and Cumulative Projected Available Inventory Calculation

Intended learning outcomes: Explain scheduling projected available inventory calculation (spreadsheet and graphical representation). Describe the cumulative projected available inventory calculation (graph) or store throughput diagram.



The scheduling projected available inventory calculation attempts to assign the associated scheduled or planned receipt to every requirement.

Figure 12.1.3.1 shows the previous example using this type of calculation, where customer order 25810 has been moved forward to June 10.

Fig. 12.1.3.1       Scheduling projected available inventory calculation (spreadsheet).

Again, demands are listed in order by date. Receipts, on the other hand, are sorted by the date on which they will be needed in order to have projected available inventory. The following situations result in lists of exceptions (only the first one appears in Fig. 12.1.3.1):

  • A demand can only be covered by bringing forward a corres­pond­ing receipt. Two receipts of this kind are indicated by an asterisk (*) in the first column in Figure 12.1.3.1.
  • A receipt can be deferred, since the associated requirements have a later date than the date of the receipt.
  • There are demands without corresponding receipts, so an order proposal should be generated.
  • Planned or released orders without assigned demands may be canceled, if necessary.

Thus, the scheduling projected available inventory calculation also creates a link between materials management and scheduling by providing proposals to speed up or slow down production or procurement orders.

Conversely, if the production or procurement orders cannot be speeded up, the scheduling projected available inventory calculation indicates which requirements will have to be delayed. The orders associated with these demands should then be slowed down temporarily and then speeded up again as soon as the demands become available.

The scheduling projected available inventory calculation can also be shown in graph form. The graph in Figure 12.1.3.2 has the same contents as the spreadsheet in Figure 12.1.3.1. Negative projected available inventory corresponds to a backlog and is shaded accordingly, and the two extreme responses — delaying an allocated quantity or speeding up a production or procurement order — are shown as examples.

Fig. 12.1.3.2       The scheduling projected available inventory calculation (graph).

The cumulative projected available inventory calculation contains the same information as the noncumulative calculation, but it also provides the cumulative totals for entries and issues along the time axis.
Store throughput diagram is another name for the graphical representation resulting from the cumulative projected available inventory calculation.  

This is illustrated in Figure 12.1.3.3. It is more difficult to represent, because the values along the vertical axis are sometimes very large.

Fig. 12.1.3.3       The cumulative projected available inventory calculation (graph) or store throughput diagram.

The expected projected available inventory is shown as a vertical difference. If the cumulative issues curve is higher than the cumulative receipts curve, then we should expect a negative projected available inventory. This will correspond to the expected backlog and is again shaded accordingly.




Course section 12.1: Subsections and their intended learning outcomes