Vyksa Steel Works (AO VSW, Nizhny Novgorod Region, and OMK subsidiary) has automated control of its inventories. The facility has commissioned a system to reduce inventories and to mitigate the risks of being short of materials in regular use. Thanks to this project, VSW reduced its inventories by over 100 million rubles and speeded up inventory turnover by 27%.
The project was implemented by SAP Digital Business Services using the SAP MRP Monitor (SCM Consulting solutions). The system will help classify materials based on a number of parameters, including seasonality and trends, costs, turnover rate, and liquidity. A broad range of parameters will help improve planning accuracy, adjust inventory levels, and accounting, storage, and distribution costs. The systems also has a function to model and select optimized reserves, shipment sizes to top the reserves off, generate multiple business scenarios, and use the most suitable one.
“VSW has created a state-of-the-art flexible inventory planning decision making system. Previously, inventory classification and reserve analysis had been done manually. The new system has helped reduce the amount of labor required for the process, increase process transparency, reduce inventories, and release some previously tied down company funds”, noted SAP CIS Service and Support Director Ara Aguzumtsyan.
“VSW operates in a highly competitive environment. An automated inventory management system is a tool that every state-of-the-art facility needs. It makes material demand planning a whole lot easier. We have recorded a considerable reduction in inventories and and increased inventory replenishment rates which improved the efficiency of the entire facility”, said Vyksa Steel Works Managing Director Alexander Barykov.
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