Inventory optimization produces operational and cost efficiency

By Jocelyn Facciotti,
Determining optimal inventory stocking levels should be a strategic, data-driven calculation,
however, the unfortunate reality is that many companies do not have accurate data and reporting
capabilities to make these calculated decisions.

Too often maintenance professionals are influenced by the fear of stocks outs, while procurement
leaders and finance executives strive to minimize on-hand inventory and cost. Two of the most
difficult challenges that maintenance and procurement professionals face are maintaining quality
data while balancing inventory investment versus production downtime risk.
In a maintenance mindset, the cost of having extra inventory on the shelf is incomparable to the
cost that would be incurred if those parts were unavailable during catastrophic equipment failure.
While there are arguments to support this theory, operational excellence requires a strategic
balance in which both risk aversion and cost-effective inventory management are satisfied.

It may seem like an overwhelming challenge to tackle at first glance, but there is a solution that
can generate immediate cost savings and improved efficiency, while providing many indirect
procurement benefits along the way. The answer is Inventory Optimization.
Based on 24-36 months transactional purchase history and on-hand quantities, inventory data is
sorted into OEM and MRO categories.

From there, items are segmented into typical commodity groups, including: Bearing & Power
Transmission, Electrical, Instrumentation, Industrial Supplies, Fluid Power, and Pipes, Valves &
Fittings.
The next phase of the inventory optimization process requires inventory to be segmented based
on usage.

Finally, the Inactive category is broken down into Critical Spares, Slow-Moving, and Obsolete
Materials.
Critical Spares are items, which are essential for the business to operate and stocking out of these
parts would significantly impact production, quality, and safety.
The Slow-Moving category represents infrequently used items with long lead times or
recommended spare parts which are kept to satisfy risk aversion.
Furthermore, Obsolete Materials are items that are no longer used within the facility and must be
disposed of an effort to recover some type of investment dollars.

Since these calculations are data-driven, client input is required to accurately determine inactive
categorisation.

Optimsation and rationalisation of the above mentioned categories require a very strategic
approach but can return significant cost savings.
Within the inactive category, we consistently find that Critical Spares represent 15-20 percent,
Slow-Moving items represent 20-25 percent, and Obsolete items represent 15 percent.

The fact is every company has excess inventory, regardless of how robust their enterprise system
and purchasing processes may be.
As a result of implementing an Inventory Optimization and MRO Analysis strategy, companies can
uncover millions of dollars in cost savings and improved efficiency, while establishing a solid
foundation to effectively manage inventory investment and risk moving forward.


Conclusin

Me parece interesante este articulo porque es importante tener un control de cualquier
cantidad de Bienes u Objetos que tengamos a disposicin, ya que es lo recomendable en
cualquier entidad, compaa o institucin, para saber que se tiene para la venta o para la
transformacin de la materia prima para llevarlo a ser un producto terminado.
Los inventarios comprenden, adems de las materias primas, productos en proceso y
productos terminados o mercancas para la venta, los materiales, repuestos y accesorios
para ser consumidos en la produccin de bienes fabricados para la venta o en la
prestacin de servicios, empaques y envases y los inventarios en trnsito, etc. es decir es
ideal que la empresa sepa con que cuenta, para que cuando vendan el producto no se
quede con ms materia prima o producto terminado del que se necesitaba, y as no
generan desperdicios.
Se tiene que tener en cuenta que la base de toda empresa comercial es la compra y
ventas de bienes y servicios, de aqu viene la importancia de un buen manejo de
inventario por parte de la misma. Este manejo contable permitir a la empresa mantener
el control oportunamente, as como tambin conocer al final del periodo contable un
estado confiable de la situacin econmica de la empresa.