Smart Inventory Management System

Challenge Summary

A smart inventory management system to predict the demand and forecast of products, automatic logging of transactions in the inventory, marking of obsolete products and identify potential buyers for clearance of inventory and working capital from historical data.

Challenge Scenario

The stocking of inventory is done considering the forecast of consumption for upcoming months/weeks, the demands are met only over a period of time. There is no rapid movement of existing inventory to the consumers, various units store their products in respective places once there is a complete change in technology at equipment level these spares/products become redundant and result in locking up of the working capital, hence a system capable of predicting demand and forecasting products according to the changing technology trends, automatically logging transactions in the inventory and predict when a product is about to become obsolete and as well suggest possible buyers for the product, freeing up the working capital.

Profile of the End-User

Inventory management teams, Buyer/Purchase departments

Existing systems: 1. SAP based ERP System (ECC 6.0/S4 HANA) 2. Ariba System.

Gaps: The current systems do not possess a predictive edge inbuilt in them; they are static data management systems of details on inventory.

Functional Requirements of the End-User

  • Forecast demand for products based on buying patterns of customers
  • Clear obsolete inventory and free up working capital
  • A Vendor Managed Inventory resulting from the process automation of the complete value chain to maintain agreed levels of inventory.

Functional & Operational Capabilities

  • Analyse historic data of buying patterns of customers with changing technology trends
  • Predict when a product will become obsolete from available data.
  • Suggest possible buyers to sell products before the products become obsolete

Operational constraints

  • Adequate availability of historical buying patterns of customers.
  • Changes to habits and training to use the system
  • Import data from legacy systems, integration with SAP platform

Expected Tangible Benefits and Measurable Gains

  • Adequate availability of historical buying patterns of customers.
  • Real time tracking of inventory
  • Reduction of Procurement Cost
  • Reduce Administrative Overheads
  • Reduced turnaround time (TAT) for material delivery

Performance Metrics or Outcomes

  • Inventory Value in Stock & Trend
  • % of Obsolete/Non-Moving Inventory Value against Total Inventory Value & Trends