Twelve Qualities of a Successful Inventory Planner


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A summary of the most desirable skills for professional inventory planners. How to identify and hire excellent inventory planners.

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Twelve Qualities of a Successful Inventory Planner

  1. 1. What Makes a Great Inventory Planner? Twelve Qualities of a Successful Inventory Planner Inventory planning sometimes seems like a no-win proposition. Too much or not enough, each scenario has a serious impact on a businesses’ reputation, efficiency and profitability. Physicist Niels Bohr put it best, “Prediction is very difficult, especially about the future." Fortunately, optimal fulfillment, forecast and inventory turn results can be consistently achieved through the alignment of the appropriate processes, systems and most importantly, people. Through my experience in hiring and developing inventory teams, I have identified the key professional qualities inherent to the most successful inventory planners. With inventory dollars accounting for one of the largest assets on a retailer’s balance sheet, it is important that the properly qualified personnel oversee the management of the inventory. It is ironic that in some organizations, this important financial responsibility is assigned to lower paid, entry level or under-qualified people. Planners can be responsible for millions of dollars of purchasing, while also directly affecting customer satisfaction through adequate instock. These are critical responsibilities with an impact on the success of the business that few others in the organization hold. The most successful retailers elevate the planning position and function, fully integrating it within all aspects of the organization. Positive business results come from the communication and collaboration between the inventory, product/merchandising, creative, financial and supply chain teams. The key aspect to the successful implementation of the role of inventory management within the overall business process is the hiring and developing of the “right” people for the inventory planner position. You can have the best inventory processes and systems in the world, but an unqualified planner will lead to subpar results, missed opportunities and unnecessary expense.
  2. 2. So what qualities really define a great inventory planner? It is not simply a matter of hiring “analytical personalities” or statistical experts and expecting them to be successful planners. Great inventory planners can be developed from a wide variety of disciplines and backgrounds, as long as they possess the foundational characteristics outlined here. The key is to identify and hire candidates with a good balance of quantitative skills and qualitative thinking. A common assumption is to stereotype a planner as a purely “numbers person”, when in fact, the best planners possess both strong analytical and resourceful creative skills. They should be able to think objectively while interpreting meaningful insight from both quantitative data and qualitative factors. I have found the following attributes to be most indicative of the best inventory planners: 1. Q u a n t i t a t i v e An a l y t i c a l S kill s : There is no substitute for strong analytical and logical thought process as a key component of a planner’s mindset. They need to have a proclivity for working with numbers, reports and data analysis. This does not mean they have to be statistical experts; however, they must have an understanding of business math and the ability to relate to and form conclusions using numerical data. 2. S y s t e m s Aptit u d e : It is also imperative to possess the interest and aptitude to understand and utilize the systems and programs that support the planning and decision making process. A successful planner is proficient with planning systems, but also knows that systems have limitations and do not
  3. 3. always account for unanticipated variables and evolving trends. This is where good judgment and experience become critical to a successful process. 3. T e c h n i c a l Kn o w l e d g e : An astute planner has an understanding of the definitions and formulas of the key inventory metrics. They should know what it means to “turn” the inventory, how weeks of supply and safety stock are determined, why it is crucial to judiciously utilize open to buy dollars. They should understand the statistical factors and variables producing the forecast, while aware of variances, risks and accuracy levels. An understanding of the meanings behind the metrics helps them to value the implications of their actions on the bigger operational and financial picture. 4. P e r s p e c t i v e : Successful planners have the ability to think globally and strategically, with a perspective of the business beyond the SKU level. They understand the aggregate inventory positioning as it relates to the instock, open to buy and turn objectives. They are aware of the organizations’ business strategy and how their decisions can impact the overall success and profitability of the organization. 5. C l e a r Com m u ni c a t i o n . It is essential to ensure direct and timely communication of relevant issues to all appropriate stakeholders. This includes knowing when to use a phone call or personal contact, rather then solely relying on email. It is a small, connected world today, and there should be no reason for uncertainty or surprises along the supply chain highway. Great planners also have the ability to extrapolate meaningful insight from large volumes of data, summarize it and communicate findings in a concise way. It is an art to be able to translate data into actionable information and drive positive results.
  4. 4. 6. O w n e r s h i p : Planners should treat their area of responsibility as if it were their own business or store. This level of focus requires the diligence and pride to do what is necessary to effectively manage the “shop”. The reality is that there are real people (customers) and physical product behind each number on a spreadsheet. Satisfying those customers will ultimately determine the planner’s success and contribute to the profitability of the business. Planners should be engaged and accountable for achievement of their assigned strategic goals and results. 7. F o c u s : Not everyone can sit in front of a computer for eight hours a day, concentrating on numbers and spreadsheets. Planners must have the discipline and the ability to focus on a range of various SKU level details. The most important aspect of being in or out of stock is the accuracy of the individual SKU level plan/forecast. The top-level plans/forecasts are important, but the SKU level inventory position ultimately determines the customer fulfillment and inventory related expenses. 8. P r i o r i t i z a t i o n : In addition to being able to focus on the important details, the planner must also maintain a practical perspective and not get buried in the minutia of voluminous data. There is almost no limit to the amount of data available so it is important that priorities be set and a method of identifying outliers/exceptions be identified. The 80/20 rule applies fittingly to SKU management as generally 80% of the sales volume is generated by 20% of the SKUs. The planner must prioritize their workload to first address the critical 20% of the SKUs that have the greatest impact on the business. Since planners are responsible for numerous SKUs, prioritization skills and the use of exception reporting is critical. 9. S o u n d Ju d g m e n t : A planner should have a pragmatic approach to decision making, using system recommendations and qualitative analysis to
  5. 5. evaluate risk/reward scenarios and make the appropriate decisions that are aligned with the strategic goals. It is important that system generated recommendations be evaluated for reasonableness to avoid unintended output. The planner should have the ability to approach problems and data objectively and form conclusions despite ambiguous information. 10. F o l l o w T h r o u g h : Challenges and roadblocks are part of any job, so the planner must have the initiative and diligence to persistently manage through issues to resolution. It is important that the planner build collaborative relationships with business partners to coordinate operational process and to help resolve issues. The best planners are really facilitators of the supply chain, taking on the responsibility of seeing that every step of the supply chain is executed efficiently to ensure timely instock. They have the persistence to follow through and not accept “no” for an answer when hitting roadblocks within the supply chain. 11. P r o a c t i v e / S e n s e of Ur g e n c y : A strong planner is proactive in identifying opportunities and risks to the business, utilizing the appropriate level of urgency to address critical issues. Being proactive to developing business trends and urgently resolving problems can make the difference between positive results or mediocrity. The planner’s early identification of fast or slow sellers, allows for actions to maximize revenue opportunities or mitigate expenses. Addressing opportunities and issues with a sense of urgency can generate revenue and control expenses across the organization. 12. P o s i t i v e At t i t u d e : The most successful people in any job have a positive attitude and a desire to continually learn and contribute excellence in the job’s execution. They have an enthusiasm for the challenges and they work
  6. 6. passionately to meet or exceed their assigned goals. They do not accept the status quo, always looking for innovative ways to enhance processes and improve results. Without a positive attitude, all of the prior skills will not be fully maximized and the investment of time and training will be underutilized. So how do you identify and hire the people with the best potential to be successful planners? In the interview process, first review their analytical skills and systems knowledge. Ask for examples of how they have completed projects or resolved issues using data analysis. Ascertain their experience and comfort level when working with unfiltered data. Get a good sense of the thought process they apply when resolving issues. Then move on to ask questions that go beyond analytical evaluation to gain an understanding of their of their qualitative reasoning process. What type of relevant factors would they review in addition to numerical facts? What internal and external rationale would they base their decisions on? How do they weigh the risk/reward trade-off of a decision? Are they capable of independent thought, considering all pertinent variables or do they rely solely on system recommendations? Do they have the desire to take ownership of their business and proactively take the necessary actions to ensure positive results? Have they demonstrated persistent follow through on challenges and are they adept at problem solving? If the situation allows, it can be advantageous to hire candidates identified with potential planning skills as temporary employees. An evaluation period is established for training and exposure to the process, helping to determine if they have a strong aptitude to become a competent planner. Hiring and developing planners with comprehensive quantitative and qualitative skill sets, based on the attributes shown above, will go a long way in creating a robust, responsive and respected inventory control organization. Paul Angelos has twenty-five years of inventory control and supply chain experience, working
  7. 7. with start-up organizations and the largest branded retailers, developing planning processes, systems and people. He can be contacted though LinkedIn or email at: