Dynamics NAV – Supply and Demand by Event
In implementing dynamics NAV, I often go through explaining supply and demand. Companies which trade products often do so by managing the supply and demand parameters outside the ERP system. Often the ERP system does not support real planning tools and therefore the staff is forced to come up with alternative ways. In those cases, I would go as far as saying the system is not an ERP system. It is more like an order and invoice printing system. In my opinion Quick books falls into that category.
Real ERP systems, like Dynamics NAV, are built around supply and demand. That is the whole idea of an ERP. Whenever we have a demand, like a sales order, the system automatically triggers to fulfill that demand with either a purchase order or inventory. This can get complicated. You could have demand from sales orders, production orders, transfers and forecast to be filled by inventory, purchase orders, production orders and transfers.
Some people insist on filling each demand with a particular way of supply. Such as, a sales order is fulfilled by a particular purchase order and so on. If the item is homogeneous there is no need to work this way. The system should aggregate the demand and generate purchase orders for the supply. Further it could forecast further demand and make sure you are covered for anticipated demand. All you have to do is monitor the decisions.
All of the statements above seem natural and reasonable, but it is incredible how often companies think they are different and they cannot adopt this principle. Most of the time they are wrong and their business processes simply have to be refined.
In Dynamics NAV, the user uses worksheets to monitor supply and demand. The system suggests what to do give the current state and lists that in a worksheet. Sometimes it is difficult to see in the worksheet why the system is suggesting the action to be taken. Below is an example of an output in a worksheet. We are particularly interested in the Black Loudspeaker. There seems to be a lot of suggestions of cancelling and changing quantities.
There is a new page which lists Supply and Demand by Event. I particularly like this format because instead of listing periods where the user had to look for the changes, it just picks the dates that are affected and lists those. (see below)
This page perfectly outlines all the documents affecting the decision that the system is making regarding inventory. As you can see these can be quite many. Excellent contribution to an already great system!