Discussion on the Application of Information Systems in Inventory Management

The overall goal of the spare parts management information system of XCMG Technology Marketing Company is to establish a networked service system based on Internet/Intranet on the basis of the existing informatization of XCMG Technology Marketing Company, and incorporate the company's spare parts service, allocation, sales, procurement, warehousing and other businesses into a unified system platform for operation. Realize the standardization and normalization of business operations; Meanwhile, with the aid of information technology, the company's strategy of joint control of spare parts inventory based on the coordination center is realized, and the physically dispersed spare parts resources are virtually centralized managed through information flow. The implementation of the information system should be able to provide real-time and historical true, reliable and summarized intelligence data for the entire spare parts management activities of the enterprise. By using these data, the company can respond to users' demands more quickly, offer more timely services, and ultimately improve service levels and user satisfaction. This intelligence information can also be shared by other departments of the company such as strategy, planning, finance, marketing, and customer service, enabling these departments to obtain information that can be used in their business fields and helping them make better decisions. At the same time, the system should be capable of supporting XCMG Technology in achieving information integration throughout the entire product life cycle.

1? Feasibility study

At present, the main interfaces of the spare parts management information system are: the production management system ERP that the company is currently using, and the networked service system based on Internet/Intranet that is about to be developed. The spare parts management information system sends a data request to the ERP system. The ERP system extracts the data and transmits it to the spare parts management information system through ODBC. The spare parts management information system then provides the required data to the WEB system.

From the perspective of business management, although spare parts management involves a wide range of areas and is technically complex, with the support of modern management, technical economics, and market economics theories, relevant calculation formulas can be summarized from some qualitative management methods and experiences by combining theory with practical experience and using statistical methods in statistics. This not only meets the requirements of management, It also provides a feasible basis for the development of auxiliary management software.

From the perspective of computer application and development, the currently popular international Internet promptly disseminates all kinds of information to the world at any time. Some developed countries and some large domestic enterprises have also established a management model centered on computer networks, enabling various organizations in the spare parts center to exchange and share information through computer networks. It provides a necessary foundation for enterprises to adapt to the development of the market economy.

(3) With the development of software technology, network applications mainly based on the file sharing mode have been replaced by those mainly based on the client/server (C/S) mode.

(4) The development methods for management information systems are already quite mature: by leveraging network and communication technologies, network and communication technology C/S structure planning and design techniques, database technology, JAVA technology, etc., systems that are easy to use and maintain can be developed.

Taking all the above aspects into consideration, from the current status of spare parts management and computer technology, it is feasible to apply computer networks to replace some manual management and decision-making in the equipment management department.

2 Information simulation implementation

Realizing multi-level and barrier-free information sharing through information systems is an important means to achieve scientific management of spare parts. The information system can incorporate all the links related to spare parts management into the enterprise's information management platform, enabling all levels of nodes such as spare parts suppliers (including the production and manufacturing department), spare parts centers, spare parts regional centers, service stations/marketing centers, etc. to operate under the same platform, and ensuring the unobstructed flow of all information between each link. Through the real-time summary of data information, the spare parts center can grasp the demand information and current inventory information of regional spare parts centers and spare parts agency points in real time, and make timely decisions based on the demand and inventory status. This processing approach realizes resource sharing and integration in space, transforming physically dispersed inventory into virtual centralized inventory, and enabling centralized inventory management through information flow. At the same time, centralized storage of information can further reduce the inconsistency of information, thereby minimizing the losses caused by data inconsistency. With the historical information stored centrally and analyzed through scientific methods, the future demand for a certain material can be predicted relatively accurately, reducing the error in demand prediction. The problem of demand amplification at each level caused by the inability to share demand information among node enterprises and the independent operation of inventory in the process can be effectively controlled. The sharing of demand and inventory information can reduce the variability of overall demand, as the high demand in one regional center may be offset by the low demand in another region. By reallocating materials from nodes with low demand to those with high demand, the overall inventory cost will not fluctuate too much.

The following illustrates the role of information systems in inventory forecasting through a simulated budget:

Suppose the spare parts system consists of one central warehouse and seven regional warehouses, and each warehouse implements the (s, S) inventory control strategy. First, list the symbols that appear in the model and their meanings (where K = 1,2,3,4,5,6,7), as follows:

I - The initial inventory quantity of warehouse k in the region during period t;

P (x) - The probability distribution of the demand for regional warehouse k being x during period t, and ∑P (x) = 1;

? (x) - The probability distribution function of the order demand generated by the regional warehouse k in time period t being x;

x - The order quantity generated by the regional warehouse k during the t period;

? (x) - The probability distribution function of the company's demand being x during period t;

d - The average daily demand of warehouse k in the region during period t;

S - The ordering point of regional warehouse k;

S - The maximum inventory of regional warehouse k.

In addition:

S = S - the company's maximum inventory.

△ = S-s - The difference between the maximum inventory of the regional warehouse k and the reorder point.

d = d - The average daily demand of the company during period t.

D = d - The total demand of warehouse k in the region during period t.

Method One: Under the traditional inventory management approach, the headquarters is unaware of the specific demands of each major region. It merely arranges procurement and inventory based on the previously predicted demand quantities of each region.

Method Two: Under the new inventory strategy model, in an environment of information sharing, the headquarters implements organized and coordinated inventory management. The company headquarters can obtain the real demand situation of its downstream regions in previous ordering cycles at any time and determine its own procurement and coordination plans.

Since the total demand for spare parts of the company is the sum of the demands of the seven major regions, the probability distribution function of the company's demand at time t being x can be calculated based on discrete random variables and the probability solution method as follows:

? (x) = P (x = x) (6-1)

Since all major regions follow the inventory control strategy of (s, S), it can be concluded that? The piecewise distribution function of (x) is:

? (x) =

Method One

Suppose the probability that region k may generate an order after the t period since the last order is:

P (x) = P (d≥△, d < △ (6-3)

The probability distribution function of the order quantity x generated by region k in time period t is:

? (x) =

Method Two:

Due to the timely transmission and sharing of information, the headquarters coordination center can understand the consumption of service spare parts in each major region every day. According to the assumption that the actual consumption of each major region at time t is D, then the probability of an order occurring on t+1 day and the probability of the order quantity being x are:

P (x) = P (d≥△, d < △) (6-5)

? (x) =

It can be seen that the actual consumption occurred after adjustment