Inventory Planning Parameter Governance Checklist

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7 critical items still open - these are the highest-risk gaps.

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Ownership and policy

A written policy states how safety stock, reorder point and lot size are setCRITICALEach parameter has a named owner by item group or plannerCRITICALService level targets are defined by ABC or demand classThe policy states who may override a calculated value and whyThe policy is reviewed at least once a yearNew planners are trained on the policy within their first month

Data quality

Lead times are compared with actual receipt history at least twice a yearCRITICALItems with zero or blank safety stock are reviewed on purpose, not by omissionUnits of measure for purchase, stock and issue are consistent for each itemCRITICALInactive and obsolete items are flagged and excluded from planningMinimum and maximum lot sizes reflect supplier terms that are still validRounding values match packaging quantitiesDemand history used for calculations excludes one-off orders and returns

Calculation and review

Safety stock is calculated from demand variability and lead time variability, not a flat percentageCRITICALFast movers are reviewed monthly and slow movers quarterly or less oftenIntermittent and lumpy demand items use a method suited to themA report lists items below safety stock and items above a maximum coverageParameter changes of more than a set percentage need a second approvalSeasonal items have separate parameters or time-phased settingsSupplier performance feeds back into lead time and safety stock decisions

Change control and audit

Every parameter change is logged with user, date, old and new valueCRITICALMass changes use a tested load template with a review stepCRITICALA rollback copy of the previous values is kept before mass changesAccess to change planning data is limited to planners and master data staffChanges that affect inventory value are shared with financeQuarterly sampling checks that changed values match the approved request

Performance feedback

Stockouts are traced back to the parameter or process that caused themExcess stock is traced back to the parameter or process that caused itKPIs include inventory turns, fill rate and days of supply by classResults are reviewed in a regular planning or S and OP meeting

Count the items you can answer yes to. Critical items are the ones that cause the largest real problems when missing; fix those before anything else.

Parameter exception scan

Optional: an automated scan of your item master for the issues above.

Optional. The tool and every export work without this. No spam.

How to use the checklist

Work through each group with the planning lead and the ERP administrator. Tick the items that are true today, not those that are planned. Critical items are marked because their absence tends to produce visible failures such as stockouts, wrong order quantities or unexplained changes. Export the result as the baseline for an improvement plan.

Do it with two people to avoid optimistic answers
Check evidence, such as a change log, for at least three items
Repeat every six months and compare

Why parameters need governance

MRP and reorder point logic execute whatever the master data says. If lead time is understated by a week, orders are placed late every time, and the planner works around it with expedites. If a mass update doubles safety stock for a class, inventory value rises and nobody sees why until the quarter close.

Evidence to collect

For lead time, compare the planned delivery time with the distribution of actual receipt days from purchase history. For safety stock, compare the value with calculated need at the target service level. For change control, pull a change log for a month and trace two changes back to approval. These checks take little time and show whether the process works.

Common mistakes

Treating governance as a one-time cleanup, giving everyone access to edit planning fields, and adjusting values without recording the reason. Another is optimizing each parameter alone: raising safety stock to hide a bad lead time only masks the cause and ties up cash.

Frequently Asked Questions

How often should planning parameters be reviewed?

Fast moving and critical items monthly, the rest quarterly or twice a year. Lead times need a review at least every six months or whenever a supplier changes, since they feed safety stock directly.

Who should own safety stock values?

Usually the planner for the item group, under a policy set by the supply chain manager. Finance should be informed of large changes because they alter inventory value and the working capital position.

Do I need approvals for every change?

No. Use a threshold, for example any change above a set percentage or any mass update, to require a second approval. Small corrections by the planner can follow the normal log.

Is this specific to one ERP?

No. The checks apply to any ERP with planning parameters, including SAP, Oracle, Infor, Epicor, Dynamics and NetSuite. The place where changes are logged differs by system.

Netray can build read-only checks that scan your item master for the issues in this checklist and list the exceptions for planner review.

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