Reference

Glossary and FAQ

The spares and inventory terms used across this wiki, and the questions that come up most.

Glossary

EOQ	Economic order quantity, √(2DS/H): the order size that balances ordering cost against holding cost.
Reorder point (ROP)	The stock level that triggers a replenishment order: lead-time demand plus safety stock.
Safety stock	The buffer held against demand and lead-time uncertainty, sized as z times the lead-time standard deviation.
Service level	The probability of not stocking out in a cycle. Sets the z multiplier and follows criticality.
Min / max	The stocking limits: min is the reorder point, max is min plus the order quantity.
Lead time	The time from raising an order to the part being on the shelf.
Poisson demand	The model for slow, intermittent demand, where the variance equals the mean.
(S−1, S) policy	One-for-one replenishment: order one each time one is used. For critical or costly slow movers.
Criticality	The consequence of a stockout, inherited from the asset, that drives the service-level target.
Insurance spare	A rarely-demanded, high-consequence, long-lead part held on a risk case, not on demand.
Rotable	A repairable assembly that is swapped and refurbished rather than consumed.
MMD 3.1	A structured material master data description standard: noun, modifier and attributes.
De-duplication	Finding and merging records that are the same physical part under different descriptions.
BoM	Bill of materials: the parts that make up an asset, linking spares to equipment.
MRP	Materials requirements planning: netting demand against stock and orders to raise replenishment.
Obsolescence	Stock that can no longer be used because the asset or the part has been superseded.
Golden record	A single trusted record for each physical part that every site and system maps to.
Harmonisation	Reconciling descriptions, part numbers and classifications across multiple ERPs and sites into one view.
UNSPSC / eClass	Standard category-code schemes for classifying materials and services.
Pooling	Sharing a spare, or its safety stock, across sites so the group holds one buffer instead of many.
Redeployment	Moving excess or obsolete stock from a store that does not need it to one that does.
GARPI™	Global Asset Reliability and Performance Index: the independent, ISO 55001 and GFMAM-aligned Optimal benchmark of asset-management maturity, a 0 to 100 composite score across eight weighted dimensions and five maturity tiers.

FAQ

How can inventory fall while availability rises?	Because the capital comes out of the slow-moving tail that never gets used, while the critical parts get better coverage. Targeting, not a blanket cut, is what does it.
Why not just hold two of everything?	It ties up capital in parts that never move and still misses the odd long-lead critical part. Stocking to criticality and demand is both cheaper and safer.
Why is data cleansing first?	Because duplicated and mis-described parts cause phantom stockouts and duplicate holding. Optimising dirty data just optimises the errors.
How are insurance spares handled?	On a risk case: the holding cost against the expected downtime cost, not an economic order quantity, since there is little or no demand history to model.
Does it work with SAP?	Yes. OptimalSPARES™ is built to be ERP and SAP ready, writing classified data and stocking parameters back for materials requirements planning.
Does it work across multiple sites and ERPs?	Yes. It harmonises material data across ERPs and sites into one trusted record, which is what makes cross-site pooling and group-level figures possible, and it prepares the data for an SAP S/4HANA migration.
How does it relate to OptimalAvailability Studio™?	Availability Studio produces the asset criticality and the maintenance tasks; OptimalSPARES™ turns those into the parts held to execute them.

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