For the following defined scenarios, the system will generate an alert for handling in the Exception Control Center (ECC) program, according to the hierarchy defined in Replenishment Parameter Maintenance.
Alert on non-replenishment items with hits
Alert on product arriving too early/too late for demand
Alert on calculated VS. frozen order point / line point / order quantity variance
Alert on unconfirmed purchase orders
Alert for purchase orders past promise date
Review cycle out of outside limits
Most of the parameters, when set at a scope that is more specific than company level, will require entry of an expiration date. FACTS will generate an alert to the responsible buyer before the parameter expires, giving the buyer the opportunity to review whether the parameter should be extended, adjusted or allowed to expire.
The term “frozen” is defined as any parameter that will not be updated by a system process and is either unchanging or under manual control. For an item with parameters expiring, the number of months for Unfreezing will be used to generate the alert in the appropriate time period. A parameter is expiring if it has an expiration date and is not able to be set as frozen. Freezes on controls always have an associated expiration date, after which, the system begins or resumes automatic updates to the control.
Once the expiration date has been reached for a parameter, the parameter is removed.
This parameter can only be set at the company level.
The term “hits” refers to an item appearing on a sales order, transfer or other document that would record usage for the item.
If an item is set to not be replenished, it may be important to know that an increased level of activity is occurring with this item so it can be reevaluated. Special order or discontinued items are just a few of the examples of items that can be flagged in the system and a buyer alerted to this activity allowing the item to be addressed accordingly. The values defined in this section indicate under what circumstances alerts will be generated for this scenario.
This alert can be set at any of the levels in the replenishment parameter hierarchy.
| Alert on Non-Replenishment Items with Hits | Indicates whether an alert should be generated |
| Number of Hits | The # of document hits needed for an alert to be raised |
| Number of Months | The # months back to look for hits |
If an item has frozen controls and that item has the indicated # of document hits in the # months specified (going back from today), an alert will be raised.
Tech note: For this alert, references will be made to the warehouse / item combination and the event trigger will be recorded as the date of the last hit. This method will allow future alerts to be generated as needed by the alert system and prevent repetitious alerts in the Exception Control Center.
When determining abnormal usage for a warehouse/item, you can specify whether to be notified when a value falls outside a high and low usage amount. Then an alert can be generated to review the usage. FACTS flags usage as abnormally high or low based on the setting in this parameter. The summary screen of Usage Review displays whether the 30-day usage is high or low. No actual alert is generated for high or low usage.
The last 30 days of usage is compared to the prior number of months’ usage indicated by this parameter. The prior months usage is then multiplied by the multipliers indicated to determine whether the last 30 days usage should be considered high or low.
Example: if usage months was 3, high usage multiplier was 1.5 and low usage multiplier was .5, if the current month’s usage was higher than the sum of the prior 3 months’ usage times 1.5, the current month would be considered hi usage. If it was lower than the prior 3 months times .5, it would be considered low.
| Usage Months | The number of months usage to use as the comparison usage. |
| High Usage Multiplier | The value for the multiplier when calculating high usage. If the current month’s usage is higher than the calculated average multiplied by this multiplier, it is considered high. |
| Low Usage Multiplier | The value for the multiplier when calculating low usage. If the current month’s usage is higher than the calculated average multiplied by this multiplier, it is considered low. |
| Expiration Date | The expiration date for the usage settings to expire. |
| Memo | Usually a brief explanation for why the multiplier is in place |
This alert is referred to as the “timeline analysis.” It provides the buyer with advance notice that a PO or transfer will not arrive before a stock-out is likely to occur or if, when the goods arrive, there will be a serious overstock of the item.
Providing that advance notice gives the buyer options to address the issues before they cause potentially serious consequences like losing customers.
The calculations are based on current stocking levels, average daily usage of the items and expected delivery dates of the PO or transfer.
If, based on those values, the item is expected to be stocked out for “Too Late Days” or more when the PO or transfer arrives, an alert will be generated.
For “Too Early Days”, if there will be that many days’ supply or more on hand when the PO or transfer arrives, an alert will be raised.
| Alert on Product to Arriving Too Early/Too Late for Demand | Indicates whether an alert should be raised when a product arrives too or early or late for demand. |
| Too Early Days | The expected number of days’ supply that will trigger an alert. |
| Too Late Days | The number of days of expected stock-out that will trigger an alert. |
| Memo | Usually a brief explanation for why the alert is in place |
A warehouse/item can have its Order Point, Line Point and/or Order Quantity set and frozen with an expiration date for the freeze. Freezes can be dangerous because they are set at a specific point in time, and while the frozen values may have been reasonable at that time, things can change.The values defined in this section indicate under what circumstances alerts will be generated for this scenario.
For example, key customers may discontinue purchasing an item, but the frozen values have buyer continuing to stock unnecessarily high quantities. Conversely, sales for an item may accelerate, but the frozen values are stuck at low values causing frequent stock outs.
To help alleviate these issues, you can setup the parameters for this alert.
FACTS automatically recalculates the replenishment controls each day. In the case of items with frozen controls, the calculated values are simply ignored in favor of the frozen values. FACTS will check the calculated values against the frozen values, and if they deviate by more than the limits established in this parameter, an alert will be sent to the responsible buyer so they can evaluate whether the frozen value is still appropriate.
| Alert on Variances Exceeding These Limits | Indicates whether an alert should be raised when a variance exceeds the specified limits. |
| Variance Exceeding Value can be in Units/ Cost / Percent Variance limits can be entered separately for Order Point, Line Point and/or Order Quantity. If the variance between the Calculated verses Frozen value exceeds any one of the values, an alert will be raised. If a value is left blank, it is ignored for purposes of raising an alert. | |
| Units | OP, LP and OQ are all unit quantity references. If the frozen value is higher or lower than the calculated value by the entered number of units, an alert will be raised. |
| Percentage | If the frozen value is the entered percentage higher or lower than the calculated value, an alert will be raised. |
| Cost | The difference in the frozen units and the calculated units will be multiplied by the item’s cost, and if the total cost difference in higher than the entered cost, an alert will be raised. |
| Expiration Date | The date the variances expire |
| Memo | Usually a brief explanation for why the alert is in place |
Many distributors request that the vendor confirm receipt of all purchase orders. This process may create some additional administrative work, but a lost purchase order that isn’t discovered for many days can cause stockouts and angry (or lost) customers.
Purchase Order Entry contains a field for indicating that the purchase order has been confirmed by the vendor. It is manually updated, and use of it is optional.
If you select this setting, buyers will receive an alert if a PO for a vendor they are responsible for remains unconfirmed after the number of days specified.
This parameter can be set at the company, warehouse, vendor, and/or purchasing line levels.
| Alert on Unconfirmed Purchase Orders | Indicates whether an alert should be raised for purchase orders that have not been confirmed in a specified number of days. |
| Number of Days | The number of days a purchase order can go unconfirmed after printing and generate an alert. |
| Expiration Date | The date the variances expire. |
| Memo | Usually a brief explanation for why the alert is in place. |
There are many reasons vendor might be late delivering a purchase order, and the sooner your buyer is made aware of the problem, the more likely you will be able to resolve the situation before it becomes a crisis. This parameter indicates that is a PO is more than the specified number of days past the promise date and has not been received, that an alert should be raised to the buyer.
This parameter can be set at the company, warehouse, vendor and/or purchasing line level.
| Alert on Purchase Orders Past Promise Date | Indicates whether an alert should be raised for purchase orders that have exceeded their promise date. |
| Number of Days | The number of days past the promise date for a purchase order to generate an alert. |
| Memo | Usually a brief explanation for why the alert is in place |
Seasonality analysis will look at a full year’s activity, and if the activity in concentrated in only a few months, it will be considered seasonal. What the level of concentration is and how many months it is concentrated in are selected in this parameter.
For example, some may consider an item seasonal if 75% of the activity occurs in a 3 month period. Others may consider it seasonal if 80% occurs in a 4 months period.
In either case, items with too few total hits can be excluded from the analysis, as can items that have not been setup in the warehouse for a long enough period of time.
In Warehouse/Item FM, the Usage Type is selected and may be frozen. This field can be set to Trend, which is how FACTS flags an item as seasonal.
If seasonality analysis determines that the usage type is set incorrectly, an alert will be generated.
If the usage type is frozen, the item will not be analyzed. If seasonality analysis raises an alert, but you are certain the usage type is correct, simply freeze the usage type so the alert will not be raised in the future.
This parameter can only be set at the company level.
When a review cycle has a preferred target base of Cost, Weight or Cubes, calculates outside of the minimum or maximum review cycle an alert will be raised. The Review Cycle value is set in Review Cycle Setup (ICE560).
This parameter can be set at the company, warehouse, vendor and/or purchasing line level.
| Alert When Review Cycle Exceeds These Limits | Indicates whether to raise an alert when the review cycle value deviates from the minimum and maximums entered for the alert. |
| Minimum Days | The minimum days to use to raise an alert if the review cycle falls below this value. |
| Maximum Days | The maximum days use to raise an alert if the review cycle exceeds this value. |
| Minimum Percent | The minimum percent to use to raise an alert if the review cycle falls below this value. |
| Maximum Percent | The maximum percent use to raise an alert if the review cycle exceeds this value. |
| Expiration Date | The date the variances expire. |
| Memo | Usually a brief explanation for why the alert is in place |
See also
Understanding replenishment values
Entering alert Replenishment Maintenance parameters
Replenishment variables calculations
Inventory Control replenishment parameters