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Attribute Based Planning – To Avoid Too Many SKUs

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Attribute-Based planning:

Do you really need a new SKU for every possible configuration of your products? The answer is simply NO if you deploy Attribute Based planning (ABP). With ABP, a generic product is defined and then attributes are used to distinguish all the different configurations of that product. Furthermore, ABP enables you to plan with attributes rather than trying to plan production based on each separate SKU. It allows you to peg different orders from each customer to their exact specifications without having to proliferate the number of SKUs. This saves time to generate plans, reduces memory and processor requirement, simplifies the maintenance of the system and enables creating accurate plans. More importantly, as the business changes, new attributes can be introduced making the system extremely flexible and adaptable.

In the planning process,

ABP takes into account the new features or required components in order to do long-range planning (both demand and supply) as well as short-range execution. This implies that specific processes, equipment or suppliers must be selected (by the system) based on the new features (attributes). Furthermore, because of its full pegging capability, Attribute Based Planning allows visibility as to where each product was made and how it was made. This is a very powerful capability in case of defects as well as meeting customer requirements of the specific choice of processes, suppliers, and their suppliers. In some cases, it is almost impossible to address the planning problem unless ABP is used. As an example, consider when a customer specifies a range of the certain parameter (e.g. wavelength or shade of a color, or speed of a processor) of a product that is acceptable to them. ABP can easily and dynamically perform the planning and pegging based on the outcome of each process while the product is being produced or components are being purchased rather than waiting until it gets into the last stage, i.e. finished goods when it is too late!

ABP is a very effective tool to generate accurate plans without having to define every detail for every product separately. It reduces the planning time by orders of magnitude because of the reduced SKU numbers and it produces plans (both short term and long term) which are accurate and executable. For more information on the benefits of ABP click HERE.

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