Production and Inventory Planning Problems - Example

Production and Inventory Planning Problems by Student’s name Course code+name Professor’s name University name City, State Date of submission Abstract Planning of the supply chain is an important issue in most organizations. Organizational functional units like finance, marketing, operations and sales specializes traditionally in planning activities portions whose results are conflicts over priorities, expectations and preferences. In this paper, a report on findings from different case study analysis of several successful supply chain planning processes. Comparing to a research area that is traditional, which has a focus on structures, incentives and responsibilities, an adoption of a process perspective and a finding that integration was achieved through a landscape that is the incentive which was not in its support was shown. The process is identified as an additional mediator on the incentive landscape which affects outcomes of the organization if the distinction between process planning and incentive landscape is drawn. Due to this, the capability of the organizations integration may arise while differing functions retain incentives that differ for their stakeholders' needs maintenance. An identification of the requisite attributes of the process of planning which drives performance planning (procedural, alignment quality and information) was found through iterative coding. In addition, to perform nan hypothesis that achievement of alignment in plan execution can be more important in comparison to procedural and informational quality. Adding to attributions of the process, a social element that influences the process planning, performance and also the placement of the processing attributes information in organizational and a broader social context is identified. Several inventory method techniques are used in the paper and it was found that its performance can be measured in terms of logistic cost, inventory control methods in relation to the total cost of supply chain and inventory turnover ratio . Introduction As per the 17th Annual state of Logistics Report by Wilson in 2006, as a percentage in the US domestic production, logistics of business costs has grown by 9.4 percent. Approximately 33 percent of over $1 trillion spent on logistics can be an attribute of holding inventory cost. Owing to this, the research on management of inventory is very critical and for a long time has been a center of research for many academic literatures. Many articles have been published by researchers from several fields that discusses the inventory management theory. In general, there is a scarcity of literature review on this subject as there are large numbers of paper on it making it a very tiring task (Tsou et al, 2011). Moreover, there is unavailability of inventory management research in general. Due to the inadequacy of resources, the practical and theoretical advancement of inventory management is paralyzed. Guidance in the development of future work has been limited by the researchers without a reference that is clear on what they have accomplished. As the practical problems have to be solved, the managers are forced to use more efforts in finding the solutions. The aim of this paper is beginning the process of reviewing and cataloging inventory management research by examination of several works from the logistics field. A significant and unique contribution has been made by logistics researchers regarding the theory of inventory management and examining of the research work to create contribution appreciation and increased awareness in details. Furthermore, the advancement of theory of inventory by finding research opportunities in the future and theme highlighting is facilitated by it. Inventory management models created within the logistics field happens to have issues that are not broadly addressed in other fields. Considerations of warehousing and transportation are among those issues. Adding to this, because the mentioned issues are the logistics functions' central components, they have received that attention as having a critical importance to the inventory management effectiveness and efficiency. Logistic management is defined as the part of supply chain management that controls, plans, and implements the efficient, effective reverse and forward flow and goods, services, storage and the information that is related between the origin and consumption point in order to carter for customers' needs. The definition is as per the Supply Chain Management Professionals (CSCMP). A unique perspective on inventory management have been provided to the researchers by the focus of management of logistics on the goods and services storage. Die to that, a significant contribution to the literature on inventory management has been developed. Literature review According to Oliva & Watson (2009), most supply chains of organizations i.e. supply chain facing the administration and the demand that is facing the activities which does a minimization of mismatches, hence creation and capture of value is an effort that is cross functional. They also made an identification of a highly differentiated organization that has a supply chain planning that is successful and used a grounded theory development for the identification of key successful cross-functional integration. There literatures' methodology is by use of Leitax research site which is a consumer electronic firm that is based in northern California and it is all over the globe. The cause of their choice to this methodology is because of three reasons about Leitax. They found out that little attention is paid to the process for coordination within the literature management operations. Moreover, they found out that in the literature of the organizational behavior, the general integration focus in the midst of the firms is established longer and better traditionally, which explicitly incorporates more the dynamics of behaviors of the main actors. The limitations of their study is it is among the less understood integration components. The core aspect of their study is recognition of the value of information sharing among partners of the supply chain, this is as shown by Min & Yu (2004). We can see from their paper that comparing to the traditional business paradigm that has a focus on the efficiency and effectiveness of business functions that are separate. A large percentage of companies have realized the jointly planning strategic benefits, designing and controlling a supply chain through inter-organizational and functional integration. The methodology they used in their study is normative (analytical) and descriptive (conceptual) studies. By use of descriptive studies an illustration of various managerial benefits of evaluating or using CPFR comparing to traditional demand planning by case example is shown. On the other hand, the normative studies are designed to assess the CPFR positive impact on several performances of the supply chain comparing to the procedure that is less forecasting or old legacy system. From their study we can see they give room for future research in their work. Sohel Rana et. al (2015) argued that supply chain strategy application can help retailers make a wise decision to increase the performance of the supply chain. The methodology used fro data collection was by use of structured questionnaires from one hundred and fifteen managers of certain selected retail chain stores in Bangladesh. Partial Least Squares was the mode data was analyzed with smart PLS software version 2.0M3. In this study, firstly they found out that the most pivotal factor influencing performance of retail supply chain is agile supply chain. The second finding is that the lean strategy is a contributor to the performance of the retail supply chain. Last but not least, they found out that the hybrid strategy exhorts' a weak influence in performance increase of the retail supply chain. The focus of most companies today is on reduction cost to ensure there is effectiveness in organizational supply chain where performance metrics and measurements are the prime parameters that has drawn the attention of practitioners and researchers for usage in measurement, this is as the assertion of Aruna Kumari & Vijaya Kumar. There are several methodologies used in the paper XYZ, VED, and FSN analysis, EOQ and JIT method, Minima-maxima system and ABC analysis. It was found out that this methods helped in several supply chain sectors, for example the usage of EOQ is mainly to discover a quantity that is optimum to be ferried from place to place keeping quantity and cost in mind. In another study, Chandren et.al (2015) explains that an activity conducted by firms to do a confirmation and inspection of the balance of physical inventory to book balance is the inventory physical count. The firm requires to use an approach using a guide manual to perform the best practices in IPC. The findings are when book balance are greater than physical balance then the end stage of IPC is well organized, put in action and planned for desired outcome. The opposite too is evident when physical balance is greater than the book balance. In another study, Hmida J.B et. al (2013) made an evaluation of policy inventory was conducted on an offshore vessel company. The methodology proposed is summed up into three parts, first you have to do a ranking of parts, second step development of a preventive maintenance program and finally standardization of most crucial parts. The study observed that by focusing on key parts, a firm with very broad inventory could reduce its size effectively. In another article, Piboonrungoj & Disney (2015) does an exploration of inter-firm collaboration in the supply chain of tourism by cost of transaction economics by use of only one method of case study. They found out that costs of transactions consists of quality checking and the search costs. The study also brings out a revelation that transaction cost of tourism operators may be reduced by trust. Explanation of the phenomenon in collaboration of the supply chain using the lens of the transaction costs economy is the major contribution of this paper. Jones's et.al (2015) method of application of radio frequency identification (RFID) technology that is within the organization of the health care using the main concepts of its treatment as an enterprise of a supply chain. They used the methodology of understanding where to implement RFID possibly and their findings included recent results from certain company recent research on the same. On a similar study to their previous one, in 2015 Jones et.al discussed how RFID has become the upcoming technology which most businesses, manufacturers and warehouses have been attracted to use, while many others still analyses the cost and use of variables which come with the technology. An analysis of the RFID is the main aspect of the paper. According to Baldassarre & Campo (2015), a growing attention is paid by companies to the supply chain volatility and most manufacturers are doing reassessments of their world wide sourcing strategies. They used an investigation method and their main finding is the approach of companies in their global management of supply markets and those trade-offs that can cause effect on strategic sourcing decisions in future. Methodology The representation of his research is based on secondary data. It used literature from peer articles puished in peer scholarly journals , books, online database, conference papers, healthcare and many others were conducted. The international journals such as IEEE, ACM, PROQUEST, JSTOR, EMERALD and others is the base of the conference and research papers. The key sreach words were “inventory,” “production,” “management,” challenges,” “problems,” and “supply chain” Discussion The production sector consists of various sectors which have a dedication in providing different goods and services to the supply chain. Production consists of manufacturing industries, hospitals, educational sectors among others. The production sector requires a very sound planning for it to run smoothly and be successful. Furthermore, the management plays a major role in the production and inventory sector as without them coming up with the strategies of supply chain the whole sector will fail. The production industry starts with training of individuals on the running of the sector. Higher learning institutions are set up to offer the required training on different sectors of production and inventory. The training is in different categories from certificates, diplomas or degrees which are a requirement for any professional license or certification. Moreover, the training institution gives students a chance to work hand in hand with the workers in practice to improve their experience in the sectors of their study. Findings differed from one research to the other, but the core aspect that was observed was a different approach to production and inventory management other than the traditional approach is used for supply chain development. The limitations observed in this research is the production and inventory literature is too wide that makes its review scarce. The material found are very shallow, making it even harder to compile the papers. In that case the journal writers have limited access to their papers thus making the managers to work extra hard to cope up with the production and inventory process. The research allows anyone who needs to use the idea for future study especially in helping managers to find solutions to many production and inventory problems they encounter. In most journals on production and inventory, the findings shown does not in any way allow managers and academics to strategize and understand the way to take to enable them do implementation of the business practices. The study has few implications for any strategy makers within the supply chain and any firm level. From the findings too it can be evident that the question that would have been answered well is the strategic priorities and goals as the discussion will allow the supply chain and firm's competitive position to explore their linkage. Research limitations This research relied on secondary data. It used data collected and published for the purposes of a different studies. As noted earlier, there is a lot of research published on supply chains, production and inventory management. Most of the literature does not tackle the challenge that affects production and inventory planning. In this regard, this research faced the challenge of collecting the right articles. Future studies should have multiple-source as opposed to asingle source of data collection in order to collect adequate data for research. Conclusion Many approaches have been discussed on the production and inventory topic by very many journals but not much information is available for use by managers in implementation of the supply chain management. Many studies from medical, industrial and many others have shed some light on the issue and most of their findings have been discussed in the paper. Several methods used to get the data have been discussed too and the findings of the analysis discussed and shown. Most of the research papers that are comprised in this paper have given way to further research on supply chain management, thus anyone willing can expound on them. The best foundation of implementing the supply chain management policy as shown is by training of the managers and practitioners in that sector so that they get more experience in their work area. Comparison of traditional research areas and recent research areas is essential and what is shown is that most managers prefer the recent to traditional ones. The main limitation of this field is that heir is scarcity of review, this is attributed to limitation by researchers on their reference to their work thus giving managers a hard time in managing some practical problems. Recommendation Anyone that thinks can make a change in supply chain management is recommended to make it easy for production and inventory management problem to reduce. Adding to that, a lot has to be done on future research and studies as the current ones are not detailed hence many researchers are needed to do that. All sectors of the economy needs to come up with S&OP of supply chain for smooth running and avoiding confusion. While training, the students need to be equiped fully by the ideas of production and inventory management in order to help in the problem of supply chain management. A lot has to be done to solve this problem of production and inventory and more funds are needed to do so. References Albarune R. et.al. 2015, Valued supply chain for integrated hospital management: a conceptual framework, International Journal of Supply Chain Management, 4(3), 39-49,. Alshamrani A. 2012, adaptive control of a reverse logistic inventory model with uncertain deteriorations and disposal rates, Advances in Operations Research , 2012,(490983) 1-12 doi:10.1155/2012/490983 Alshamrani A. 2012, Adaptive control of a two-item inventory model with unknown demand rate coefficients, Journal of Applied Mathematics, Volume 2012, Article ID 810635, 1-16 doi:10.1155/2012/810635. Aruna Kumari C. P & Vijaya Kumar Y. 2015, An optimum way to evaluate the performance of outbound SCM through process eveluation, Int. J Sup. Chain. Mgt, 4(3) 59-62. Baldassarre F. & Campo R. 2015, Assessing the global dimension of sourcing: an exploratory study on Italian companies, International Journal of Supply Chain Management, 4(3), 15-24. Benjaafar S. 2010, Production-inventory systems with imperfect advance demand information and updating, Naval Research Logistics (NRL), 58(2), 88-106. Bretthauer K. M. et.al. 2006, Production and inventory management under multiple resource constraints, Vol. 44, pg 85-95. Chandren S. et.al. 2015, Inventory physical count process: a best practice discourse, Int. J Sup. Chain. Mgt 4(3), 87-93. Chang C. et.al. 2010, Inventory models with stock- and price- dependent demand for deteriorating items based on limited shelf space, Yugoslav Journal of Operations Research 20 (1), 55-69. Charkha P. G & Jaju S. B. 2015, Identification of performance measures for textile supply chain: case of small & medium size enterprise, international Journal of Supply Chain Management, 4(3) 50-58. Chin T. A. et. al. 2015, Green supply chain management, environmental collaboration and sustainability performance, Procedia CIRP 26 (2015) 695 – 699. Didonet S. R & Diaz G. 2012, Supply chain management practices as a support to innovation in SMEs, J. Technol. Manag. Innov 7(3) 91-108. Gang D. et.al. 2012, Optimazation on production-inventory problem with multistage and varying demand, pg, 1-17. Hmida J. B. et.al. 2013, Inventory management and maintenance in offshore vessel industry, Journal of Industrial Engineering, Volume 2013, Article ID 851092, http://dx.doi.org/10.1155/2013/851092. International Conference On Production Research, Mejía, G., & Velasco, N. 2012,. Production systems and supply chain management in emerging countries best practices : selected papers from the International Conference on Production Research (ICPR). Berlin, Springer. http://dx.doi.org/10.1007/978-3-642-26004-9. Ivanov D. 2010, An optimal-control based integrated model of supply scheduling, Working Paper, St. Petersburg State University Graduate School of Management Jones .E.C et.al. 2015, Hospital supply chain management by implementing RFID, International Journal of Supply Chain Management, 4(3), pg 1-15 Jones E. C et.al. 2015, RFID: the up and coming technology, International Journal of Supply Chain Management, 4(3), pg 78-89 Jones E.C. et. Al. 2015, RFID implementation and enterprise management in the healthcare sector, International Journal of Supply Chain Management, 4(3),, pg 32-39 Kempf, K. G., Keskinocak, P., & Uzsoy, R. 2010. Planning production and inventories in the extended enterprise a state of the art handbook. New York, Springer. LANG, J. C. 2010, Production and inventory management with substitutions, Berlin, Springer. Lwiki T. et.al. 2015. The impact of inventory management practices on financial performances of sugar manufacturing firms in Kenya, International Journal of Business, Humanities and Technology 3(5) 75-85. Min, H. & Yu, W. 2004, collaborative planning, forecasting and replenishment: demand planning in supply chain management, The Fourth International Conference on Electronic Business (ICEB2004) / Beijing, 50-62 Nazemi S. et.al. 2013, Determining and prioritizing supply chain performance evaluation measures using lean thinking criteria, World of Sciences Journal; 2013(03) 114-126. Oliva, R. & Watson, N. H. 2009, cross-functional alignment in supply chain planning: a case study of sales and operations planning, Working Paper 07-001 Ouyang L. et.al. 2010, A fuzzy inventory system with deteriorating items under supplier credits linked to ordering quantity, Journal Of Information Science And Engineering, 26, 231-253. Piboonrungroj P. & Disney S. M. 2015, supply chain collaboration in tourism: a transaction cost economics analysis, International Journal of Supply Chain Management, 4(3), pg 25-31 Sohel Rana S.M. et.al. 2015, Determinants of supply chain performance: A strategic point of view, Int. J Sup. Chain. Mgt, 4(3) 94-102. Sukati I. et.al. 2012, The study of supply chain management strategy and practices on supply chain performance, Procedia - Social and Behavioral Sciences 40 (2012) 225-23. Tsou C et al. 2011, Bi-objective Inventory Management through Evolutionary Multi-objective Optimization. 2010 International Conference on Economics, Business and Management IPEDR vol.2 (2011) Tsou C. et.al. 2011, Bi-objective inventory management through evolutionary multi-objective optimization, vol. 2. Read More