Operations Management - Inventory

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Inventory Management

An Inventory is a Stock or Store of goods kept to meet customers expected demand.
Inventory can also be defined as the stored accumulation of transformed resources in a process, and it usually applies to material resources but may also be used for inventories of information.
Almost all operations keep some kind of inventory, most usually of materials but also of information and customers (Customers inventories are normally called Queues).
These inventories can take various forms, which includes raw materials purchased but not processed, work- in- process (WIP) incomplete products or components nor longer considered raw materials., maintenance, repair and operating materials which are supplies necessary to keep machines running and finished goods inventory which are ready to be sold.(Anonymous, 2007)

Inventories are costly, as they sometimes tie up working capital. They are also risky because items held in stock may deteriorate, become obsolete, or indeed get lost.
Stocks also take up valuable space.

On the other hand they provide security in uncertain environments because the operation can deliver stocks should customers demand them.

Inventory management in some operations is more than just a part of their responsibility; it is the very reason for being in business (Slack et al 2007).

The five performance objectives are Quality, Speed, Dependability, Flexibility, and Cost.
Many believe it is the most important of the five performance objectives. Quality is discussed in terms of it meaning Conformance, which would therefore mean that, quality is when a product conforms to its specifications.
When conformance is high, you save costs. Dependability and speed of response increase.

Speed is the short way of saying “speed of response”. It means time spent…...

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