What are positive and negative days in Microsoft Dynamics AX 2012 and why do we need them?
Excellent question – and one we get all the time. Hopefully this post will serve to clarify what positive and negative days are and how they are used.
Handling On-hand Inventory
Have you ever wondered about the best way to handle your on-hand inventory? How volatile is it? What are your purchase lead times? When should you use on-hand inventory versus generating a new planned order? If you are going to run Materials Requirement Planning in Microsoft Dynamics AX 2012, you need this information to plan accurately.
Negative Days = Time Span After Demand
Negative days can be summed up as how many days you can run with negative inventory before using a planned receipt to cover a specific demand, focusing on the time span AFTER the demand. You’ll need to have ship dates and lead times up-to-date and accurate. When set up correctly, negative days will generate a new planned order to meet your inventory needs in those cases when existing purchase orders are too far out.
Dynamic negative days are also an option. When dynamic negative days are selected, AX 2012 will attempt to peg replenishment and use an existing PO to fulfill demand instead of creating a new planned order. This can help lessen the “noise” AX puts out as there is only 1 PO to manage vs 2.
Positive Days = Time Span Before Demand
Positive days look at how you can meet demand with what you have or expect to have. Positive days measure the time span BEFORE the demand. Again, your ship dates and lead times need to be up-to-date and accurate. Positive days help you define when you want AX to suggest a new planned order. Is it closer to the sales order 30 days out or should existing inventory cover it until then?
Action and Future Messages
What do you do with the information you received when measuring Positive and Negative Days? Microsoft Dynamics AX will offer suggestions.
- Action messages suggest something to change on the order: increase, decrease, advance, postpone, etc.
- Future messages suggest delays and give you updates as orders get pushed back.
You want to choose which action messages and timeframes carefully. Having too many messages can be overwhelming to users, creating more “noise.” You actually don’t have to use Actions or Future messages at all if you don’t want to.
Recommendations for Getting Started
If you are just starting out, here are my recommendations.
- Set positive and negative days to the same timeframe. This will help you get an even netting to both before and after demand.
- Use dynamic negative days – they are useful and recommended.
- Decide if action and future messages are even needed. Do you need the noise and suggestions? Maybe you add those later.
Written By: Scott Martin