Time-Phased Safety Stock
A proactive Order Policy Type where orders are made when projected inventory is expected to fall below Safety Stock. This Order Policy uses forecasted demand data to maintain orders for a consistent optimal stock position over time, automatically identifies expedites and deferrals, and can adjust order quantities and dates accordingly. The process compares inventory levels in future time. It supports strategic/collaborative processes. Aerospace and defense companies typically use time phased order policy.
Time-Phased Safety Stock orders are for a fixed quantity for central locations. These are some part characteristics that would indicate that Time-Phased Safety Stock would be a good choice for the Order Policy for that part or SKU:
• Relatively higher volume
• Relatively expensive
• More critical
• Longer lead times
These are the inputs that are evaluated for parts and SKUs that use Time-Phased Safety Stock Order Policy:
• Forecast (by day)
• Procurement and repair orders
• Replenishment and balancing orders
• Sales orders
• Forecasted returns OR sales returns
• Lead time elements
• Calendars
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Time-Phased Safety Stock should not be used as the Order Policy for replenished locations unless it is absolutely necessary.
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These conditions support using Time-Phased Safety Stock as the Order Policy selection:
• If net, time phased requirements must be provided to suppliers or factories
• If you have visibility to future sales orders that are required to be planned
• To take advantage of kit planning functionality in Order Plan
• Procurement/repair locations that need time phased orders
• Higher volume SKUs
• Highly seasonal SKUs
• Longer lead time SKUs
Commonly referred to as “TP” (Time Phased).
See also