The inventory is key for managing the operational processes, it is a strategic and tactical level and an important element for the working capital. An abuse or inadequate use exposese the Operations function to unnecessary risks, such as losing visibility on real requirements or generating obsolence.
Optimising the inventory entails several decision-making steps:
The inventory also includes tangible objects that need to be handled and stocked, making use of facilities, assets and the workforce. A warehouse (independently if storing materials or finished goods) is like a manufacturing facility, and therefore needs to be adequately designed in terms of layout, physical and information flows, and operational processes. As for the manufacturing workforce, each efficiency target set for materials handling must take into account all ergonomic related risks.