Inspired by : Manage It Like You Own It by Mike Hannan
Client problem: The manufacturing end client had a statutory requirement to report the inventory valuation numbers using weighted average valuations. This entailed working through the MRP(Material Requirement Planning) items and finding the closing stock valuations of work in progress items and the final items. Alternatively the margin of the final item needs to be also calculated. The end client looked to optimize the contribution margin of its processes by in depth analysis of the cost of materials leading to cost of sales analysis.
ETL team approach: The ETL team moved from periodic to perpetual inventory valuation after data cleansing, data profiling, data auditing, data consolidation and running the perpetual inventory valuation based on the historical stock valuations after data transformation.
Steps followed:
· Automated data capture on the client machine
· Data cleansing of the end client master data
· Data auditing by matching with the end client ERP audit reports. The perpetual valuations should match with the periodic valuations.
End client benefits:
· The closing stock numbers cleared by a top 4 audit firms for statutory reports
· Visibility into the contribution margin analysis for the end client.
· Forecasting analysis possible that should help at increasing the inventory turnover ratios and improving the cash flow cycles.
Challenges:
· Master data management
· Data cleansing
· Data profiling and data auditing
Contact: Apoorv Chaturvedi
Email: apoorv@mnnbi.com
Phone: +91-8802466356
Website: www.mnnbi.com
