Purchase Control - Flipbook - Page 34
5. Average Monthly Demand
Introduction
Assuming that the system parameter 'Max/min version' is set to 1, (Volvo Dealers do not use this routine due to
SMP obligations), then the system will calculate the maximum and minimum based on a weighting of the current
demand and the previous average demand, as per the following process.
When the option to Generate the max/min levels is run, the system will also calculate the Average monthly
Demand of the part.
In order to set the new average demand, the system needs to take certain information into account:
The system looks at the date the Generate max/min levels program was last run and calculates the number of
days between now and then.
If the part is too new to have had a previous max/min run, the system calculates the number of days between now
and the date of creation of the part.
If the previous AMD is greater than 1, the system applies a factor of 2, and if the previous average demand is less
than or equal to 1, the system applies a factor of 6.
The calculation applied is:
AMD * Factor + Current demand
Factor + (number of current days/30)
The calculation will be rounded to two places of decimals.
Key Information – Average Monthly Demand
30/07/2008
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