DDMRP

 Simula,on  Game  
 Free  Version  Notes  
Kevin  Kohls  
Kohls  Consul,ng  
248.931.1959  

1  
 Free  Version  Notes  
•  This  free  version  is  for  demonstra,on  and  
teaching  use  only.    Please  do  not  use  it  in  any  
sales  material  or  for  any  sales  presenta,ons  
without  wriKen  permission  for  Kohls  Consul,ng.  
•  Much  of  this  documenta,on  is  from  the  
Advanced  Demand  Driven  class  material  and  is  
not  a  User’s  Guide,  per  se.    
•  Contact  kkohls@kohls-­‐consul,ng.com  for  the  Pro  
Version  that  allows  up  to  5  DDMRP  buffers.      

2  
 Assump,ons  
•  You  have  been  exposed  to  DDMRP  concepts  
or  you  are  a  CDDP.  
•  You  know  where  to  buy  Chad  and  
Carol’s  books  (referred  to  as  “The  
Book”  henceforth)  
–  In  other  words,  I  will  not  spend  
much  ,me  on  the  basics  of  MRP  or  
go  in-­‐depth  on  the  concepts  and  
calcula,ons  of  the  process.  
•  Please  contact  the  Demand  Driven  
Ins,tute  for  detailed  ques,ons  or  
to  take  a  class:  
•  www.demanddrivenins,tute.com  

3  
 A  Simple  Bill  of  Material  (BOM)  
•  Part  “P”  
–  Made  by  taking  raw  material  RM1  and  performing  a  process,  
which  results  in  a  Part  P.    
•  The  BOM  just  consists  of  P  <-­‐  RM1  
–  RM1  comes  from  a  supplier,  and  must  be  purchased  using  a  
Purchase  Order  (PO)  
–  It  takes  26  days  from  the  ,me  a  PO  is  issued  un,l  delivery.  
–  It  takes  one  day  to  delivery  the  P  part  to  the  customer.  
–  Note  that  the  resources  used  to  make  P  have  not  been  
specified.  

RM1   P  

4  
 The  First  Buffer  Placement    
•  If  we  wish  to  reduce  the  lead  ,me  to  the  customer,  we  
can  add  a  buffer  (in  our  case,  a  DDMRP  buffer)  to  the  
layout.      
•  We’ll  reduce  the  lead  ,me  in  this  case  to  1  ,me  unit  
(days,  in  this  case)  –  the  ,me  it  takes  to  deliver  the  
part  from  the  buffer  to  the  customer.  
•  Thus,  we  have  had  a  drama,c  improvement  in  Lead  
,me  –  from  25  days  to  one  day,  just  by  adding  buffer  
in  the  right  place.  

RM1   P  

5  
 DDMRP  Terms  
•  “On-­‐Hand”  refers  to  the  amount  of  product  in  the  
DDMRP  Buffer.  
•  “Available  Stock”  –  A  planning  calcula,on  to  determine  
the  planning  status  of  a  stocked  item.  
–  The  equa,on  is  on-­‐hand  +  on-­‐order  stock  –  unfulfilled  
qualified  actual  demand.  
–  Available  Stock  levels  trigger  a  Purchase  Order  
•  Average  Daily  Usage  (ADU)  is  the  amount,  on  average,  
that  is  removed  from  the  P  On-­‐Hand  Buffer.  

PO   RM1   P  
RM1   ADU  
On-­‐
Available  Stock   Hand  
6  
 Resources  
•  Nothing  is  free  –  in  order  to  turn  RM1  into  a  P,  it  will  have  
to  use  one  or  more  Resources.  
–  Resources  can  be  machine,  people,  processes,  etc.  
•  Using  a  resource  will  cost  money  –  it  is  part  of  our  
Opera,ng  Expense.  
•  Resources  Costs  do  not  vary  with  the  number  of  P’s  
produced.  
•  Our  generic  resource  of  our  case  is  referred  to  as  “A”  
•  A  is  directed  to  work  on  the  crea,on  of  P  by  a  Work  Order.    

PO   RM1   A   P  
RM1  
WO  
On-­‐
Available  Stock   Hand  
7  
 Buffer  Profiles  
•  Buffer  Profiles  are  one  of  the  most  important  
features  of  DDMRP.      
•  Understanding  how  they  work,  how  they  are  
calculated,  and  the  factors  that  drive  those  
calcula,ons  will  lead  to  greater  understanding  
of  the  func,onally  of  DDMRP.  
•  This  Guide  will  not  go  into  the  details  of  Buffer  
Profiles  –  the  user  should  refer  to  Orlicky’s  3rd  
Edi,on  for  more  informa,on.  

8  
 Buffer  Zones  
•  The  Green  Zone  is  used  for  Order  
Quan,ty  
–  It  determines  average  order  
frequency  and  typical  order  size.  
–  It  is  sized  either  by  the  part’s  
minimum  order  quan,ty  (MOQ)  or  a  
%  of  the  calculated  average  daily  
usage  (ADU)  mul,plied  by  the  lead  
,me.  (Use  whichever  is  larger.)  

9  
 Buffer  Zones  
•  The  Yellow  zone  is  the  Reorder  
Zone  
–  The  heart  of  the  coverage  and  shock  
absorp,on.  
–  It  is  set  to  100%  of  ADU  over  lead  
,me.  

10  
 Buffer  Zones  
•  Red  Zone  is  for  Risk  Protec,on  
and  is  made  up  of  two  parts  
–  The  Red  Base  level  that  uses  a  
percentage  of  the  Yellow  zone.  
•  It  provides  protec,on  for  Lead  Time  
Varia,on  
•  Usually  matches  Green  Zone  
–  The  Red  Safety  establishes  a  safety  
factor  which  is  determined  by  the  
amount  of  demand  varia,on.    

11  
12  
 Basics  of  the  Buffer  Profile  
3.  Green  is  the  same  as  Red  Base  (313),  and  represents  
the  size  of  the  order  once  Available  Stock  levels  fall  
below  Top  of  Yellow  (TOY  is  1408).  If  the  MOQ  is  larger  
than  Red  Base,  then  Green  becomes  the  MOQ.  

1.  Our  ASRLT  for  T  is  25,  and  our  ADU  is  25.    Yellow  is  the  
usage  over  lead-­‐,me.    Thus,  25x  25=  625  

4.  Red  Safety  is  Red  Base  (313)  x  Var.  Adjust.  (.5)  
and  provides  for  varia,on  in  demand.  Larger  
allows  for  higher  varia,on,  smaller  reduces  
inventory.  The  Red  Zone  is  Red  Safety  +  Red  Base.  

2.  Red  Base  is  Yellow  (625)  x  LT  Adjust(.5).    LT  Adjust  is  the  
“Usage  over  LT”    in  the  DDI  slides.    LT  Adjust  is  larger  in  
Short  LT  situa,ons,  and  smaller  in  Long  LT  situa,ons.  

The  Average  Buffer  Posi,on  (627)  represents  the  

Average  Amount  of  On  Hand  Stock  in  the  system.  
13  
 Geqng  Started  
•  Double  Click  the  DDMRP  simula,on  Excel  file  
from  the  Desktop.  
–  The  password  is  “Orlicky”  
–  Open  the  file  as  “Read  Only”  
–  Be  sure  to  “Enable  Macros”  
•  This  is  just  a  very  complicated  Excel  spreadsheet  
that  has  been  programmed  using  Visual  Basic.    
The  controls  are  Excel  controls.  
•  Its  easy  to  break,  so  don’t  get  too  adventurous.  

14  
 The  Main  Screen  
•  A  Blue  Screen  the  
looks  like  the  one  on  
the  ler  should  appear.  
•  Note  the  many  tabs  
on  the  boKom  
•  Since  this  is  Excel,  we  
can  click  on  on  them  
to  look  at  different  
input  screens.  

15  
 The  Basic  Sheet  
The  Basic  Sheet  is  
where  you  will  be  
spending  the  most  
of  your  ,me.    It  is  
the  farthest  tab  to  
the  ler,  so  hit  that  
tab  if  you  get  
“lost”  on  another  
sheet.  

You  should  note  that  the  number  of  

resources  that  are  available  are  
currently  0,  so  if  you  aKempt  to  run  
the  game  now,  you  will  run  out  of  
material.    

16  
 Seqngs  Screen  
•  Let’s  go  to  the  Seqngs  Screen.  

•  Note  that  P  is  selected  as  a  Buffer  

to  use  and  that  it  is  an  Output  –  
where  end  products  are  stored  as  
Finished  Goods.  

•  Note  all  the  other  buffers  are  not  

checked  –  they  are  not  needed  for  
our  first  example.  

•  Make  sure  the  No  Varia,on  box  is  

checked  as  well.  
Later  we’ll  use  Update  Seqngs  if  we  
choose  to  change  ADU  or  ASRLT.  

17  
 “BOM”  

•  Go  to  the  “OrderCreateP”  tab  and  make  sure  the  

informa,on  above  is  looks  like  what  is  shown  above.    
This  matches  BOM  with  a  bit  of  VSM  tossed  in.  
•  This  is  where  Chad  or  Carol  will  say  this  is  not  really  a  
BOM.    Yep,  but  it  works  for  the  simula,on.  

18  
 Do  We  Have  Enough  Resources?  
•  We  also  have  to  determine  the  right  number  
of  resources  to  ensure  we  can  meet  
produc,on  demand  with  minimal  Opera,ng  
Expense.  
–  Too  few  resources  can  cause  Shortages  
•  A  late  order  to  a  customer  is  very  expensive.  
•  Per  the  contract,  we  sell  the  Product  at  the  Raw  
Material  Cost  (Throughput  Dollars  =  $0)  
–  Too  many  resources  increases  Opera,ng  Expense  
and  increases  inventory.  

19  
 Demand  From  Seqngs  Sheet  
•  We  must  be  able  to  
minimally  meet  the  Average  
Daily  Usage  every  day  with  
our  A  Resource.  
•  The  A  Resource  can  work  
only  8  hours  per  day  –  480  
minutes.  
•  How  many  A  Resources  do  
we  need  to  make  demand?  

20  
 Resource  Calcula,ons  
•  Going  Back  to  OrderCreateP,  our  BOM,  we  see  
that  it  takes  40  minutes  to  make  a  P.      
•  We  can  make  12  parts  in  a  480  minute  shir.  
•  With  our  ADU  at  60  parts,  we’ll  need  5  
resources,  minimally.  
•  We  may  need  to  periodically  add  a  resource  if  
varia,on  becomes  a  problem,  or  just  use  6.  

21  
 Running  the  Game  
Go  back  to  the  Basic  Sheet.  
 
Find  the  Clear/Run  buKons  
on  the  top  right.  
 
The  Run  Box  is  where  the  
number  of  days  to  run  (7  in  
this  case)  for  the  next   Then  let’s  hit  the  Run  buKon  –  
period.   let’s  see  what  happens.  
 
Hit  Clear  every  ,me  you  
want  to  start  over  with  the  
same  seqngs.  Do  that  now.  
22  
 •  The  Available  Stock  and  On-­‐Hand  lines  are  updated  every  
day  un,l  the  ,me  period  you  specified  ends.  
•  When  complete,  Your  P  Buffer  should  look  something  like  
this.  
•  Available  Stock  has  fallen  into  the  Yellow  Zone,  triggering  an  
order  and  causing  Available  Stock  to  go  back  to  the  TOG.  

P"Buffer"DDMRP"Levels"
800"
Note  the  lines  are  
700"
600" drawn  all  the  way  to  
500"
the  right  –  that’s  just  to  
400"
300" make  it  a  liKle  easier  to  
200"
read.    
100"
0"
1"

5"

9"

13"

17"

21"

25"

29"

33"

37"

41"

45"

49"

53"

57"

 
Go  ahead  an  Run  for  five  more  weeks.  
23  
 Other  Info  

•  You  have  5  of  the  A  resources,  which  make  these  parts.  

•  The  actual  Lead  Time  to  make  these  parts  was  5.0  days  and  the  
actual  ADU  was  60.  
•  Without  going  through  all  the  accoun,ng,  you  brought  in  $86k,  but  
had  $15k  in  expenses  (mostly  Resource  A).  
•  Thus,  you  made  $71k.    Not  a  bad  start.  
•  You  sold  480  units,  making  Demand  without  losing  any  parts.  

24  
 Purchase  Orders  &  Work  Orders  

Overall Internal Input Input Input Pred. Work Product Number Total Day Time Day Material
Product Type WC Part5# Part51 Part52 Part53 CT Order Priority to5Make Time In Left Out Available
P WO A P RM1 40 WO001HP 36% 193 5809 TRUE
P WO A P RM1 40 WO005HP 36% 232 9225 TRUE
P PO S RM1 RMS PO001HRM1 36% 193 1 0 1 FALSE
P PO S RM1 RMS PO005HRM1 36% 232 5 0 5 FALSE

The  tab  under  WorkOrders  shows  the  status  of  Purchase  Orders  and  Work  Orders.      
 
It’s  important  to  understand  that  PO’s  and  WO’s  will  be  executed  in  this  simula,on,  
but  it’s  a  bit  too  detailed  for  this  session.    We’ll  come  back  to  it  if  we  have  ,me.  

25  
 Buffer+ Time+to+ On+Hand+
Buffer Amount Priority Sheet Make+(d) Before SP:RM+$ Inventory

Buffer  Status  
P 287 0.68 P+Buffer ++++++++4.00 300 $+++++++++++200 $+++++++117,400
Q ++++++++++: 0 $+++++++++++300 $+++++++++++++++:
R ++++++++++: 0 $+++++++++++500 $+++++++++++++++:
RM1 0 ++++++++1.00 $+++++++++++++20 $+++++++++++++++:
RM10 ++++++++++: $+++++++++++++30 $+++++++++++++++:
RM2 ++++++++++: $+++++++++++++50 $+++++++++++++++:
RM3 ++++++++++: $+++++++++++++70 $+++++++++++++++:
RM4 Buffer+ Time+to+
++++++++++: On+Hand+ $+++++++++++110 $+++++++++++++++:
Buffer
RM5 Amount Priority Sheet Make+(d)
++++++++++: Before SP:RM+$
$+++++++++++130 Inventory
$+++++++++++++++:
RM6 P 287 0.68 P+Buffer ++++++++++
++++++++4.00
: 300 200 $+++++++++++++++
$+++++++++++170 $+++++++117,400 :
RM7Q ++++++++++: 0 300 $+++++++++++++++:
$+++++++++++190
RM8 R ++++++++++: 0 500 $+++++++++++++++:
$+++++++++++230
RM1
RM9 0 ++++++++1.00
++++++++++
: $+++++++++++++
$+++++++++++290 20 $+++++++++++++++:
RM10
RMS 999999566 ++++++++++: $+++++++++++++: 30 $+++++++++++++++:
$++++++++++++
RM2 ++++++++++: $+++++++++++++50 $+++++++++++++++:
RM3 ++++++++++: $+++++++++++++70 $+++++++++++++++:
•  The  Buffer  Status  sheet  shows  details  about  each  buffer.    
RM4 ++++++++++: $+++++++++++110 $+++++++++++++++:
Since  we  only  are  worried  about  one  buffer,  we  will  not  use  
RM5
RM6
++++++++++:
++++++++++:
$+++++++++++130 $+++++++++++++++:
$+++++++++++170 $+++++++++++++++:
it  much.  
RM7 ++++++++++: $+++++++++++190 $+++++++++++++++:
RM8 ++++++++++: $+++++++++++230 $+++++++++++++++:
•  The  buffer  priority  .68,  is  useful  for  doing  a  rela%ve  
RM9 ++++++++++: $+++++++++++290 $+++++++++++++++:

comparison  of  the  priori,es  of  each  buffer.    

RMS 999999566 ++++++++++: $++++++++++++: $+++++++++++++++:

•  The  value  of  the  inventory  (Raw  Material  Cost)  is  also  
included,  as  well  as  the  Throughput  Margin  of  each  part.  
–  Important  for  financial  analysis  of  performance.  

26  
 800"
P"Buffer"DDMRP"Levels"
700"
600"
500"
400"
300"
200"
100"
0"
1"

5"

9"

13"

17"

21"

25"

29"

33"

37"

41"

45"

49"

53"

57"
Your  results  should  look  something  like  this.  

27  
 Basic  Throughput  Accoun,ng  

Act$ADU

Demand
T$#(000)
Act$LT Lost Sold
P
Q
R 5.0 60.0 $####
$#####464
$#####;; 25800 0 25800
0
VT 0 0
$####464 0
$92 Operating#Expense
$$$$$372 Net$Profit

•  Because  there  was  no  varia,on,  the  Act  Lead    

+  1  (1  day  shipping  to  Customer)  Time  
matched  the  ASRLT,  and  the  Actual  Demand  
matched  the  ADU.  

28  
 Using  Warnings  
•  Demand  Driven  MRP  is  a  very  
LOW  INVENTORY  
resilient  tool  for  absorbing  
varia,on,  but  it  will  fail  if  you  
ignore  the  warning  the  
system  generates.  
•  We’ll  use  high  level  warnings  
in  the  game  to  help  you  
understand  the  problem  and  
how  to  correct  it.    

29  
 Basic  Screen  Break  Down  
Understanding  Warnings  
Today 43 Normal,Flat
Average,
High,Inv, Low,Inv, Expedite, Stock, Parts, Average, Available,
Warning Warning Warning Out Lost OnHand Stock ADU ASRLT
PT
Q
R
V 0
0 10
0
0 0
0 0
0 0
0 342
0
0 632
0 OK
0 N/A
N/A OK
N/A
N/A

•  A  High  Inventory  Warning  happens  when  more  product  is  

made  than    
•  Expedite  Warnings  occurs  when  On  Hand  drops  below  the  
Top  of  Red  x  Expedite  Factor  (found  on  the  Seqngs  sheet).  
•  See  next  slide  
•  Lost  Parts  occur  when  you  fail  to  meet  demand.  

30  
 Expedite  Level  

P"Buffer"DDMRP"Levels"
•  For  our  game,  the   800"
700"

darker  red  zone  is  the   600"

500"

Expedite  Level,  not   400"

300"

the  Red  Base  level.   200"

100"

•  Switch  back  to  the  

0"

1"

5"

9"

13"

17"

21"

25"

29"

33"

37"

41"

45"

49"

53"

57"
Seqngs  Screen.  

31  
 Expedite  Warnings  on  the  P  Buffer  
Stop%on%Warnings Expedite Expedite%Level 50% TOR
Warnings%only%occur%on%the%P%Buffer

•  You  can  have  the  game  stop  if  a  par,cular  warning  occurs.  
•  You  can  select  “No  Warnings”;  “Low  Warning”  (TOR);  or  
“Expedite  Warning”  (Set  as  %  of  TOR).  
•  Should  use  “No  Warnings”  for  now  
–  Low  Inventory  Warning  –  the  Top  of  Red  –  occurs  very  oren,  
and  should  not  be  used  in  this  game.  

32  
 Summary  Screen  Break  Down  
Today 43 Normal,Flat
Average,
High,Inv, Low,Inv, Expedite, Stock, Parts, Average, Available,
Warning Warning Warning Out Lost OnHand Stock ADU ASRLT
PT
Q
R
V 0
0
0 10
0
0 0
0
0 0
0
0 0
0
0 342
0
0 632
0 OK
0 N/A
N/A OK
N/A
N/A

•  Average  On  Hand  is  average  Finished  Goods  parts  stored  and  ready  to  be  
shipped  over  the  dura?on  of  the  game  –  42  days  in  this  case  (The  number  
shown  is  always  “today’s”  date  –  before  the  Run  buKon  is  pressed.  
•  Average  Available  Stock  is  all  the  inventory  in  the  system,  WIP,  and  any  
unprocessed  orders.    This  is  the  average  over  36  days.    
•  See  Orlickly  for  a  more  detailed  explana,on.    
•  The  ADU  and  ASRLT  can  be  High,  Low,  or  OK.  
•  ADU  High,  for  example,  means  more  demand  is  higher  than  what  was  
entered.  
•  How  would  this  impact  your  Seqngs?  
33  
 Varia,on  
•  OK,  ,me  to  leave  Oz  and  get  closer  to  the  
real  world.    We  are  going  to  add  varia,on  
by  going  to  the  Seqngs  screen  and  
unchecking  the  box  that  removes  varia,on.  
•  Go  back  to  the  Summary  screen  and  hit  
“Clear”  to  reset  the  simula,on.  
•  Then  type  in  42  in  the  Run  Box  box  and  hit  
“Run”.  

34  
 Varia,on  
Note  the  variability  in  the  
Available  Stock  and  the  
On-­‐Hand.  
 
If  we  had  set  the  Warning  
Level  to  “Expedite”  vs.  “No  
Warnings”  the  run  would  
have  stopped  at  Day  38.  
 

35  
 Reducing  Inventory  
•  If  you  have  higher  throughput,  lead  ,me  will  drop  and  
inventory  may  increase.      
–  LiKle’s  Law  
•  In  our  game,  adding  resources  will  increase  throughput.  
•  Clear  the  game,  and  then  enter  10  in  the  number  of  
resources.  
•  Run  14  days  
–  What  does  the  sheet  tell  you?  
•  Reduce  the  ASRLT  to  3,  and  the  LT  Adjust  to  .5  
•  Hit  “Update  Seqngs.”  
•  Return  to  Basic  and  Run  14  more  days.  
•  Can  you  reduce  the  ASRLT  again?  

36  
 Reducing  Inventory  
ASRLT  =  4   P"Buffer"DDMRP"Levels"
800$

700$

3  
600$

500$

400$
2  
300$

200$

100$

0$
1$

5$

9$

13$

17$

21$

25$

29$

33$

37$

41$

45$

49$

53$

57$
!100$

•  Note  all  of  your  color  bands  have  dropped.  

•  What  was  the  overall  reduc,on  for  the  
Averages?  
•  Hold  the  cursor  over  one  of  the  lines  that  look  
like  the  average  –  how  much  did  you  save?  
37  
 Capacity  Issues  
•  Close  the  Free  Version  without  saving  and  
then  reopen  the  game  to  restore  the  original  
version.    
•  Go  to  the  Basic  screen  and  enter  3  resources  
into  the  appropriate  box.  
•  Hit  Run  and  watch  what  happens  to  the  two  
lines.  

38  
 A  BoKleneck  
P"Buffer"DDMRP"Levels" •  One  of  the  things  we’ll  have  
800$
700$ to  be  aware  of  is  the  
600$ boEleneck.  
500$
400$ •  When  there  is  a  lack  of  
300$ capacity,  a  downward  trend  
200$
100$
will  become  obvious.    
0$
•  We  should  realize  this  when  
1$

5$

9$

17$

21$

25$

29$

37$

41$

45$

49$

57$
13$

33$

53$
inventory  hit  a  Expedite  
!100$
!200$
level,  but  it  depends  on  how  
unstable  the  system  is  to  
•  When  would  you  have  taken  ac,on  to   start.    
avoid  this  situa,on?  
•  How  many  days  did  it  take  
•  The  trend  will  vary  with  the  difference   for  us  to  run  out  of  parts?  
in  Resource  Capacity  to  Demand.  
•  We  also  could  reduce  our  ADU  so  that  
our  resources  could  keep  up,  but  that  
would  have  reduced  our  profits.  
39  
 Work  Orders  
Work Overall Internal Input Input Input Pred. Work Product Number Total Day Time Day Material
Order Product Type WC Part6# Part61 Part62 Part63 CT Order Priority to6Make Time In Left Out Available
22 P WO A P RM1 40 WO022IP I25% 233 11110 33 8104 TRUE
26 P WO A P RM1 40 WO026IP I25% 209 12475 TRUE
31 P WO A P RM1 40 WO031IP I25% 206 9170 TRUE
35 P WO A P RM1 40 WO035IP I25% 203 5883 TRUE

•  Go  back  to  the  Main  Sheet  and  Reload  the  Simple  Scenario,  then  
run  the  model  for  35  days  with  3  resources.  
•  We  can  switch  to  the  Work  Order  sheet  to  get  a  sense  of  what  is  
happening.  
•  If  you  are  willing  to  do  the  math,  you’ll  see  that  there  are  4  orders  
consis,ng  of  594  hours  (74  days)  wai,ng  in  front  of  WC  A.    
–  That’s  worse  than  the  Department  of  Motor  Vehicles.    

40  
 Scenario  
•  Your  are  making  Part  P,  and  you  can  any  number  of  A  
resources.      
•  Your  P  product  has  priority,  so  you  can  get  the  
resources  if  you  need  them.    If  not,  you  can  give  them  
to  other  departments.  
•  Your  boss  has  asked  you  to  maximize  the  profit  on  P’s  
in  70  days  without  any  lost  parts!  
–  Day  71  will  be  on  the  Screen  arer  70  days  have  passed.  
•  You  only  get  10m  to  do  this  –  and  no  star,ng  over!  
•  See  if  you  can  beat  my  score  -­‐-­‐  $616k  profit  with  no  
losses.  

41  
 Seasonality  
Shown  here  is  one  of  the  Planned  
Adjustments  you  can  make  –  one  
based  on  Seasonality.  

•  Close  without  Saving  and  

P"Buffer"DDMRP"Levels"/"One"Year" then  Reopen  the  Free  
1000"
version  of  the  game.  
900"
•  Go  the  Main  sheet  and  
800" selected  Seasonal,  keeping  
700"
the  Demand  Medium.      
600"
•  Go  to  the  SeKng  Screen  and  
hit  Update  Seqngs.    
500"

400"

300"
•  Then  go  to  Basic  Sheet  and  
200" hit  Clear  
100"

0"
We  can  also  use  Ramp  Up,  
1"

Ramp  Down  and  Transi,on.  

42  
 P"Buffer"DDMRP"Levels"
Planned  Adjustments  
In  our  simple  case,  we  actually  look  an  
ASRLT  forward  (4  days,  in  our  case)  to  look  
at  Top  of  Green,  and  Order  to  that  level  if  
Available  Stock  fails  into  the  Yellow  area.  
1"

5"

9"

13"

17"

21"

25"

29"

33"

37"

41"

45"

49"

53"

57"
43  
 Puqng  It  All  Together  
•  Play  with  game  with  the  Seasonal  Planned  
Adjustment  with  Variability,  and  add  and  
delete  resources  based  upon  the  status  of  the  
P  DDMRP  buffer.  
•  Run  the  game  at  increments  of  7  days.    We’ll  
either  Stop  at  350  or  when  ,me  expiries.  
•  Be  a  liKle  paranoid,  but  not  crazy  paranoid  –  
try  not  to  lose  any  Sales.  

44  
45  
0"
100"
200"
300"
400"
500"
600"
700"
800"
900"
1000"

$0.00$$
$500.00$$
$1,000.00$$
$1,500.00$$
$2,000.00$$
$2,500.00$$
1$ 1"
5"
8$ 9"
13"
15$ 17"
22$ 21"
25"
29$ 29"
33"
36$ 37"
41"
43$ 45"
49"
50$ 53"
57"
57$ 61"
65"
64$ 69"
73"

status.    
71$ 77"
78$ 81"
85"
85$ 89"
93"
92$ 97"
101"
99$ 105"
109"
106$ 113"
117"
113$ 121"
125"
120$ 129"
133"
127$ 137"
134$ 141"
145"
141$ 149"
153"
148$ 157"
161"
155$ 165"
169"
162$ 173"
177"
169$ 181"
185"
176$ 189"
193"
183$ 197"
190$ 201"
205"
197$ 209"
213"
204$ 217"
221"
211$ 225"
229"
218$ 233"
237"
225$ 241"

with  resources,  but  cut  more  

245"

Opera&ng)Expense)-)Seasonality)
232$ 249"
P"Buffer"DDMRP"Levels"/"One"Year"

253"
239$ 257"

I  was  cau,ous  at  the  beginning  

out  at  the  end,  based  on  buffer  
246$ 261"
265"
253$ 269"
273"
260$ 277"
281"
267$ 285"
289"
274$ 293"
297"
281$ 301"
305"
288$ 309"
313"
295$ 317"
302$ 321"
325"
309$ 329"
333"
316$ 337"
341"
323$ 345"
349"
330$
337$
344$
$0.00$$
$5,000.00$$
$10,000.00$$
$15,000.00$$
$20,000.00$$
$25,000.00$$

Q
P

V
T 1$
9$
17$
25$
33$
41$
Act$LT
3.1

49$
57$
Results  

65$
73$
81$
89$
97$
105$
113$
121$
129$
137$
145$
$########<
$########<
$########<
$########<

153$
161$
$####4,048

169$
177$
185$
193$
201$
209$
Act$ADU T$#(000) Dem
64.1 $####4,048 22491

0
0
0
0

217$
225$
$$$$3,429 Net$Profit

233$
241$
Net$Profit$by$Day$-$Seaonal$Adjustment$

249$
257$
265$
273$
$620 Operating#Expense

281$
7.33% Return#on#Inventory
Lost

0
0
0
0
0
0

289$
297$
305$
313$
321$
329$
337$
345$
22491
Sold

0
0
0
0
 Summary  
•  The  purpose  of  this  Free  Version  was  to  improve  your  
knowledge  of  DDMRP.  
•  Simula,ons  allow  you  to  make  mistakes  and  learn  
while  minimizing  the  poten,al  nega,ve  impact  on  
future  decisions.    
•  If  you  have  any  ques,ons  or  feedback,  please  send  
your  thoughts  to  kkohls@kohls-­‐consul,ng.com  
•  We  may  not  be  able  to  respond  to  all  ques,ons  about  
the  simula,on  if  you  email  us.  
•  Again,  DDMRP  ques,ons  should  be  directed  towards  
the  Demand  Driven  Ins,tute.    

46