Supply management

Managing supply is essential in spare parts management. Lanza supports this process in several ways. Amongst others by using realistic lead times, giving insight into historical supply, and by optimizing your purchasing efficiency.

Lead times

Realistic lead times are essential to accurately determine inventory levels. In Lanza, there are three ways to determine what lead time to use in calculations:

Actual lead time
Historical average lead time and lead time deviation, when reliable*.
Default lead time
Lead time from ERP-system.
Manual lead time
Manually enter a lead time and lead time deviation.

* when reliable: with the setting ‘Actual’-lead times, the historical lead times are only used when they are considered reliable. What is considered reliable is dependent on . The exact numbers are configurable in the global settings, the default values are a maximum coefficient of variation of 1 and a minimum number of deliveries of 3. If the lead times for a certain part do not comply with these restrictions, the default lead time is used.

Additional lead times

On top of the lead time from the supplier, it is important to consider any internal processing time that is necessary to acquire new parts. In Lanza, these are split up into internal processing time (e.g., the time to receive goods in the warehouse) and review period (e.g., the time to convert a order trigger into a purchase order).

These additional lead times can be configured per segment and on a part-level.

Repairables and repair lead times

For repairable parts, Lanza also accounts for the difference between new-buy purchase and repair lead times. For more information, see Repairables.

Order quantities

Correct order quantities are important to optimize your purchasing efficiency. For this purpose, Lanza calculates optimal order quantities. This is done with three methods:

Economic Order Quantity
Order quantity that minimizes the long term holding and order costs. To determine the holding and order costs, the cost per order and holding cost % are configurable per segment and on a part-level. Note that it is possible to limit the order quantity to at maximum be the expected demand over a certain period, e.g., 2 years as in the example below.
Interval
Order quantity that orders the required amount to satisfy demand in a certain period of time, or ‘interval’. The length, in number of days, of the interval is configurable per segment and on a part-level. Often the interval is differentiated based on the segment (larger intervals for cheap parts and smaller intervals for expensive parts).
Manual
Manually enter an order quantity.

Minimum and rounding order quantities

Lanza is able to account for supply restrictions imposed by suppliers or other factors. This is done by entering a minimum order quantity (MOQ) or rounding quantity (MOD) on a part-level. On a segment and part-level, you can choose to account for or ignore the MOQ/MOD restrictions.

A minimum order quantities (MOQ) stipulates that the order quantity should at least be the MOQ. If activated, Lanza compares the calculated order quantity with the MOQ, if the calculated order quantity is lower, the MOQ is used as order quantity. The MOQ is often used to account for supplier restrictions.

A rounding order quantity (MOD) stipulates that the order quantity should be a multiple of the MOD. If activated, Lanza rounds the calculated order quantity to the closest, or most optimal, multiple of the MOD. The MOD is often used to account for packaging sizes, e.g., there 100 screws in a container and purchasing is done per container.

Classification & strategy

Management by exception

Demand forecasting