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Supply Chain's Weakest Link: Inventory Management

Compiled By Deborah Austin Increased information was supposed to replace physical inventory in the 21st century -- but overall business inventories remain about the same as five years ago, says supply-chain focused consulting firm Capital Consulting & Management Inc. (CCMI), Alexandria, Va. While inventory management is the supply chain's weakest link, says CCMI, meshing of new technology with strategies to improve underlying business processes can spur improvement and free up capital. Key program elements include:

  • Updating lead times and order quantities to reflect transit time/delivery reliability improvements
  • Analyzing and sharing data on production/sales levels with suppliers and customers for timely forecast adjustments
  • Building additional flexibility into manufacturing processes, especially for seasonal merchandise
  • Redesigning warehouse networks, layouts and procedures to speed flow of goods
  • Aggressively unloading obsolete or "dead" inventory.
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