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Presentation
InventoryManagement
Preparedby
BUB0910017Aru
nSuresh
BUB0910018Afz
alMatathil
an
eepoer
ProductionPla
nningandCon
trol
M.Sc.(Engg)Engineeringandmanufactur
ingmanageme
nt
M.S.Ramaia
hSchoolofAdvancedStudies
1
1
M
oduleleader:K.N
.Ganapathi&V
ijayaKumar
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Aimand
Objectives
A
im:
O
bectives:
Toknowab
outtheelement
sofInventoryM
anagement
Tostudyaboutvariousinv
entorycontrols
ystems
Toknowab
outtheneedofinventory
TostudyaboutITintegrationinInventoryManagement
TostudythetipsforInventoryManagement
Toknowab
outpurchasingplanforInventoryManagemen
t
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WhatisInventory?
Anystockofitemswhicharekepttomeetthefuture
demandcanbecalledasinventor
TypesofIn
ventory[1]
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NeedofInventory
Tomeetvariat
ionsincustome
rdemand
.
2.Smooth
seasonalorcyc
licaldemand
rcngeae
1.Temperorypricediscou
nts
.egeagansprcenc
reases
3.Takead
vantagesofpricediscounts
rocess
up
pysurprse
1.Internal
upsetsinparts
2.Externa
ldelayinincom
inggoods
3.Transitdelays[2].
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W
hyInvento
ryManage
ment
Tomaintaina
nadequatesupplyofgoodswh
ileminimizing
inventorycosts
.
Toanswerthecriticalquestion,howmuch?When?
oaceven
ventoryproportonaty.
Inventoryma
nagementhelpsthecompanytointegratethe
followingfunctions
Strateicoals.
Salesfo
recasting.
aesanoperatonsp
annng.
Productionandmateria
lrequirementp
lanning
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[3],[4],[5
].
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M
easuresofInventoryControl
ReturnOn
Investment(ROI)
ROI=SalesCostofgoo
dssold
Phy
sical+Receivab
les+Inventory
Customerservicemeasure
s4
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CostInvolv
edinInventory
Holdingorcarryingcost
SetuporO
rderingcost
Stockoutcost[4]. M
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Ste
psforControllingInv
entory
1.InventoryPlanning
Toiden
tifythebestmix,quantityandlocationof
nventory.
Toensureequipmenta
vailabilityandefficiency.
2.EstablishO
rderCycles
xeorerquanttym
oe.
Fixedo
rderintervalmodel.
Economicorderquantity.
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Ste
psforControllingInv
entory
3.Balanceinventorylevel
Istheinventorylevels
uitabletoserve
themarket?
.
Addres
singfinancialandmarketrelatedissuesto
determinetheidealinventorylevel.
.evewsoc
s
Tokeeptheinventoryleveluptodate.
Toiden
tifyobsoletein
ventory.
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Ste
psforControllingInv
entory
5.Follow-UPa
ndControl.
Periodicreviewofinventory.
-
.
Toknowhowmuchan
dwhentoorder.
Toreviewcurrentorde
ringsystem[5][6].
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InventoryManagementSo
ftware
Itisacomputerbasedsyste
mfortrackingproductlevels,
,
.
Components:
Assettracking.
ServiceManagement.
Softwares:
Oraclee
-businesssuit.
SAPER
P[7][8]. M
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InventoryManagementSo
ftware
Importantfeatures:
Inventorycosting.
Automated
datacollectionsstem.
Orderprocessing.
temtracng.
Returnmanagement.
Locationtr
ansfer.
.
Businessnotifications.[8],[9].
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Purchasing
plansinIn
ventorymanagement
Oneofthemainaspectofin
ventorycontrolistohaveitemin
s
tockatthemom
enttheyaren
eeded.Thema
inconsiderationsin
Whencommitmentshouldbeplaced
Whenfirstdeliveryshouldbe
received
Whentheinventorshouldbe
eaked
Whenreordershouldnolonge
rbeplaced
Whentheitem
shouldnolong
erbeinstock
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Developm
entinInve
ntorymanagement
Themajortwoapproachesw
ithinmanufacturingoninven
tory
--
T
ime(JITandK
anban).
MRP-Aninformationsystemwhichconvertsalesdirectly
into
oa
on
ac
y
ysu
un
an
mepero.
aeras
are
s
cheduledmore
closelywhichreducesinventory
andshorter
d
eliverytime.
-
worsoemnae
nvenoresra
er
anopm
zng
them.Herethe
inventoryofR
M
&WIPfall
stothatneede
din
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s
ingleday.Itisd
onebyreducingthesetuptime
andleadtime.
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TipsforbetterInventorymana
gement
Atthetimeofdeliveryverifythequantityisasperthedelivery
receiptandcarefullyexaminefo
ranyvisibleda
mage.
p
ointreceived,thenreportdam
ageandrequestinspection.Report
thedamageandconfirminwriting.
Insectionof
damaeditemsand
rearesdamaere
ort
v
erifythereport
clearlybefores
igning.
Afte
inspect
iondamaged
materialshouldnotbeusedor
d
isposedwithoutpermission[10
].
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InventoryManagementB
enefits
Reducespurchasingandinventorycosts.
Transparentinventoryproc
esses.
.
Reducetim
etomarket.
Warehouseorganization.
Free-us
ace.
Facilitatesvendor-managementinventory
[11].
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Con
clusion
Inventorym
anagementis
veryimportanttoanytype
of
industrieswhetherproductandserviceoriented.Investmentsin
rawmatera,
,spareparts,
nsego
osarea
crtca
costwhichifnotcontrolledc
anleadtohigh
capitalcost,h
igh
operatingcost
anddecrease
productionefficiency.Intodays
proventobemostcriticalandalmostallf
unctionlikesa
les,
engineeringan
daccountinghaveanimpactandimpacted
by
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Reference
TypesofInventory,http://www.rajeshtemani.com,n30thMarch201.
nventoryManagement,iimm.org/knowledge_bank/6_purpose-of-inventory-t.htmRetrievedon30
thMarch2011.
PurposeofInventoryManagement,.iimm.or/knowledebank/6urose-of-inventor- __nt.htm,Retrievedon30thMarch2011.
athi.K.N.,ProductionPlanninandControllin,CourseRamaiahSchoolofAdvancedStudies,Bangalore,March
Inventory,http://en.wikipedia.org/wiki/Inventory,
n30thMarch2011.
M.S.RamaiahSchoolofAdvancedStudies18
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[7].Unknown.,Q
uickBooksInventory:AccountingIn
tegrationSupport,
http://www.smartturn.com/solutions/quickbooks-inventory-
.
,
.
[8].Unknown.,InventoryManagem
ent,
.
.
y%20Chain/Fact%20Sheet%20-
%20Inventory%20Management.pdf,Retrievedon30thMarch2011.
[9]Unknown.,InventoryManagem
entSoftware,
http://en.wikipedia.org/wiki/Inventory_management_software,
Retrievedon30thMarch2011.
[10]Unknown.,InventoryManagement,
http://www.scribd.com/doc/296110/Inventory-Man
agement,Retrieved
30thMarch2011.
[11]Lean,Harm
s,TheAdvantagesofanInventoryManagementSystem,
Retrievedon30thMarch2011.
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