Method and system for the maximization of the range of coverage profiles in inventory management

• US 6,341,266 B1
• Filed: 12/03/1998
• Issued: 01/22/2002
• Est. Priority Date: 06/19/1998
• Status: Expired due to Term

• Current Assignee: SAP SE
• Original Assignee: SAP AG (SAP SE)
• Inventors: Braun, Heinrich
• Primary Examiner(s): Hafiz, Tariq R.
• Assistant Examiner(s): Norman, Marc
• Application Number:
  US09/204,772
• Time in Patent Office: 1,146 Days
• Field of Search: 705/7, 705/8, 705/28
• US Class Current: 705/7.26
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 10/06315 Needs-based resource requirements planning or analysis
• CPC Class Codes: G06Q 10/06316 Sequencing of tasks or work
• CPC Class Codes: G06Q 10/06375 Prediction of business process outcome or impact based on a proposed change

Abstract

A method and system for managing inventory in a multiple level distribution chain by applying optimization algorithms to a range profile constructed from a formulation of the distribution network and the various elements factored in the network. A formal definition of the optimization problem is defined and several algorithms are proposed for the maximization of the range of coverage profiles. The optimization process minimizes transportation costs and avoid bottlenecks. However, if bottlenecks were to occur, the system prioritizes demands and provides an optimal solution for a monotone distribution of products. The basic function presented involves the steps of initializing the range of coverage profile with a starting value; computing the necessary in-flows necessary to fulfill the profile constraints; constructing the cheapest flow for these demands using a minimum-cost algorithm; and lowering or enlarging the range of coverage profiles until a solution is found.

Claims

1. A method for maximizing a range of coverage profiles for managing inventory comprising the steps of:

a. providing a function for a range of coverage profile;

b. initializing said range of coverage profile function with a starting value;

C. calculating an optimal amount of inventory to fulfill said function for a range of coverage profile wherein said calculating comprises the steps of;

i. applying a minimum-cost flow algorithm to construct an optimal transportation solution to transport said necessary amount of inventory;

ii. determining whether a solution is found after said applying of said minimum-cost flow algorithm for said range of coverage profile function with said starting value;

iii. incrementally lowering said starting value when said determining whether a solution is found yields no solution and repeating said computing an optimal solution until said computing an optimal solution results in an optimal solution for said minimum-cost flow algorithm;

d. incrementally enlarging said starting value when said determining whether a solution is found yields a solution and repeating said computing a solution until said computing an optimal solution results in an optimal solution for said minimum-cost flow algorithm;

e. managing inventory based upon said optimal solution.

2. A method for maximizing a range of coverage profiles of claim 1 further comprising the steps of:

a. interfacing with an online transactional processing system;

b. reading transactional data from said online transactional processing system; and

c. inputting said transactional data into said range of coverage profile function.

3. A computer-readable medium having stored thereon a plurality of instructions, said plurality of instructions including instruction which, when executed by a processor, cause said processor to perform the steps of:

a. interfacing with an online transactional processing system;

b. reading transactional data from said online transactional processing system;

c. inputting said transactional data into a function for a range of coverage profile;

d. initializing said function for a range of coverage profile with a starting value;

e. calculating a necessary amount of inventory to fulfill said function for a range of coverage profile;

f. computing an optimal solution wherein said computing comprises the steps of;

i. applying a minimum-cost flow algorithm to constrict an optimal transportation solution to transport said necessary amount of inventory;

ii. determining whether a solution is found after said applying of said minimum-cost flow algorithm for said range of coverage profile function with said starting value;

iii. incrementally lowering said starting value when said determining whether a solution is found yields no solution and repeating said computing an optimal solution until said computing an optimal solution results in an optimal solution for said minimum-cost flow algorithm;

g. incrementally enlarging said starting value when said determining whether a solution and repeating said computing a solution until said computing an optimal solution results in an optimal solution for said minimum-cost flow algorithm;

h. outputting said optimal solution to manage inventory.

4. A system for maximizing a range of coverage profiles for managing inventory comprising:

a. means for interfacing with an online transactional processing system;

b. means for reading transactional data from said online transactional processing system;

c. means for inputting said transactional data into a function for range of coverage profile;

d. means for initializing said function for a range of coverage profile function with a starting value;

e. means for calculating a necessary amount of inventory to fulfill said function for range of coverage profile;

f. means for computing an optimal solution wherein said computing comprises;

i. means for applying a minimum-cost flow algorithm to construct an optimal transportation solution to transport said necessary amount of inventory;

ii. means for determining whether a solution is found after said applying of said minimum-cost flow algorithm for said range of coverage profile function with said starting value;

iii. means for incrementally lowering said starting value when said determining whether a solution is found yields no solution and repeating said computing an optimal solution until said computing an optimal solution results in an optimal solution for said minimum-cost flow algorithm;

g. means for incrementally enlarging said starting value when said determining whether a solution is found yields a solution and repeating said computing a solution until said computing an optimal solution resulting in an optimal solution for said minimum-cost flow algorithm wherein said optimal solution is utilized to manage inventory.