Real Time Inventory: Is it Worth the Effort?
It’s late Sunday afternoon and you suddenly remember tomorrow is your anniversary. You have the perfect gift in mind, but you have one opportunity to get it before the store closes.
Real Time Inventory is a relatively new concept, offering an increased level of convenience and transparency between customer and retailer. As someone who has worked in ERP for many years, I’ve seen the transition from pen and paper inventory to day-old information to the real time inventory offered today. Check out the progression of real time inventory from the 1980’s to present:
- 1980s: During regular business hours, the only way to confirm inventory would be to stop by the store itself. Many stores weren’t open on Sundays so you were totally out of luck until the following business day.
- 1990s: You could call around on your landline to find out if the store carried the item, but you wouldn’t be able to find out whether or not they had any in stock.
- 2000s: A quick search on the internet would show who carried it, but you would still have to call to see if it was in stock at your retailer of choice.
- 2010s: Some stores began offering transparency of inventory levels online, but it was usually data from the previous night and may be out of date.
- 2021+: You can use your smartphone to see what retailers carry the item, what the price is and, at stores like Lowe’s or Home Depot, store aisle number and bin location information.
We have grown accustomed to having instantaneous information in our lives, both personally and within the business environment. That applies to inventory as well. The ability to service customers today centers around being able to predict and meet their needs within the timeframe they desire. And that timeframe is becoming more and more compressed.
To meet this, ERP systems also had to evolve. During my career ERP has gone from hand-written carbon–paper documents to overnight updates of keypunched data to online/real time systems. From mainframes to the cloud (yes, I’m that old). The modern ERP has reached the level of sophistication where not only do we know finished goods levels, but we know what is in process, where it is in the process and when it will be ready to be shipped.
Consider this scenario. Customer X wants 10,000 parts delivered in two weeks. Whether an on-time delivery is possible depends on several factors. Are there currently any in stock and available? How many can be produced within the next two weeks? Are the materials needed to make the parts available from my Supplier? Does the workforce and machine time exist to meet the demand? Without vital inventory data the decision-making process for production scheduling, MRP and whether an on-time delivery is even possible is based on someone’s internal knowledge or is simply unknown.
So, is real time inventory worth it? Most would say that there isn’t really a choice. More than likely, there is another company in the marketplace making the same product. If they consider real-time inventory data important, you must as well. The manufacturing world has recognized this requirement and modern-day ERP systems including Plex have stepped up to the challenge.
The heart and soul of Plex is real time information on inventory and the traceability throughout the process. At any given moment in time Plex reflects where inventory is located, how far it has been through the manufacturing process and the status of the inventory. Just imagine trying to prepare for the delivery of the finished product without knowing all the details. It is a crap shoot at best.
If you would like to find out why Revolution Group has been a trusted Plex consulting partner for more than 20 years, call us at 614-212-1111 or reach us at [email protected]. We would love to discuss the benefits of real time inventory and how it would benefit your company.