All too often organizations attempt to lower inventory using non-analytical approaches which lower service levels. Although counterintuitive, it in fact is possible to reduce inventory while improving service levels simultaneously using our proven inventory management methodology. Optimizing inventory levels while viewing the existing order fulfillment process as a given constraint Changing the fundamental order fulfillment process across the entire system Most clients find this two-step approach of significant value. During the first step cash can be made available quickly and success is immediately generated. Step two is used to generate breakthrough business results and provide a robust order fulfillment process that will be able to perform at lower inventory levels while providing extraordinary service levels.
Further analysis reveals that inventory levels are high and turns are below most major competitors.
In addition a technology change and a proliferation of models amplify the issue. Customer feedback reveals that a key to customer satisfaction is on time delivery and any deviation from promised dates has a negative impact on customer satisfaction. It quickly highlights some key leverage points in the order fulfillment process. Furthermore it becomes apparent that much of the current inventory is present due to internally generated variation versus customer driven order variation. Following the baseline activity various process changes are modeled to verify their impact on inventory levels and service levels.