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Logistics and operation managment - Essay Example

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Inventory management can be defined as controlling and overseeing the storage, ordering and making use of the components that will be…
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Logistics and operation managment
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Logistics and operation managment

Download file to see previous pages... Scheduling can be defined as the process of controlling, arranging and optimizing the workload in the manufacturing or production process. It is used for allocating the machinery and plant resources, planning production processes, planning human resources and purchasing material.
Inventory management, capacity planning and scheduling is of great significance, as it can be associated with the financial benefits of the organizations. The imbalance between these supply chain operations may lead to an unnecessarily increased work in process, deteriorated delivery performance and frustrated staff in the sales and manufacturing departments. However, for most of the organizations excess capacity can certainly be unnecessary and costly. The inability to properly handle these processes can also be considered as a barrier in achieving maximum organization performance. In addition to this inventory management, capacity planning and scheduling are all considered to be significant factors in the choice of technology of the organization. These processes help in determining that how much capacity must be needed by the firm, the schedule and all the processes related to inventory management that are required for manufacturing a great product or begin the production of an entire new product (R.Arnold, 2010).
The imbalance between inventory management, capacity planning and scheduling may result in under or over stocking of items. Under-stocking of items may result in lost sales, missed deliveries, production bottlenecks, dissatisfied customers and it also unnecessarily ties up the funds of the organization that could have been more productive if used elsewhere. Overstocking may have fewer drawbacks attached to it; however the cost of excessive overstocking may be quiet staggering in the cases when the inventory holding cost is high, as the matter may easily get out of the hands of the ...Download file to see next pagesRead More
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