IBP IO: How to model Supply Variability in Safety Stock calculation?

[Former Member]

Hello,

For a production facility, we measure the production reliability by calculating Schedule Attainment for each Product/Location ( compare Actual Produced Qty vs Planned Qty).

In IBP Inventory, how can one capture this supply variability in Safety Stock Calculation? Appreciate for all feedbacks and recommendations.

Thanks,

Tushar

[Former Member · Accepted solution]

Adherence = ABS (Actual Production Qty - Planned Production Qty)/Planned Production Qty

Production Lead Time CV (%) = 1.25 x (1 - Adherence) x PBR / PLT

[former_member680672 · Accepted solution]

Hi! Could you explain the 1.25 factor in the formula please?