Just In Time Systems

Devising an efficient system of counting and maintaining a stock of inventory items has long been an arduous task for many business owners. The old method of cataloging by part or item number has all but disappeared since the proliferation of electronic catalogs and the use of computer software and web-based ordering/monitoring systems. Inventory management is necessary for owners who want to maintain a stocking service for quick turnaround to help ensure total customer satisfaction. An item on a managed inventory list must be maintained to avoid shortages of frequently used items. Even when utilizing an inventory management system, occasional shortages will still occur. To be successful in today's fast-paced, highly-competitive environment, business’ need to have the necessary parts in stock or have reliable suppliers to meet customer demands at a moment's notice. Either way, shops must have a practical, efficient method for managing inventory in order to stay in business and satisfy their customers. The most efficient way to get this done is through the use of a Just-In-Time (J-I-T) system of inventory management. The service that Cardinal Health provides is an example of this type of J-I-T system which allows them to get the right quantity of goods to the right place and at the right time.

Efficient inventory management is essential in order to provide the customer with a high level of service. The ability to ship inventory on schedule and get just the right amount of product where it needs to be in a timely manner is one of the major factors that helps determine customer satisfaction. Consumers do not like to wait in lines, come back later, or shop somewhere the product is often out of stock. These are the types of problems that lead to a customer walking across the street to the find a particular product somewhere else. In addition, efficient inventory management leads to a more cost-efficient operation (Reid Ch 12, 2002). The goal is to keep inventory on the shelves for the least amount of time as possible. This prevents a high percentage of capital from being tied up in inventory. Through the use of automation and computer based systems, companies are able to control their inventory based on real-time needs instead of historical projections. This helps reduce the guess work in how much inventory to stock and when to stock it. Regardless of whether or...

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... out without the hassle of long lines or confusion. This is directly related to how the inventory is managed throughout the supply chain. Just-In-Time inventory management is an attempt to create the perfect inventory system. The idea of getting the right product to the right place and at the right time is at the core of this system. Although not always perfect, the goal is to identify problems and always strive to make it better. This can only be implemented through the use of automation and technology. Cardinal Health has integrated handheld technology, wireless web, the internet, and many other cutting edge technologies to provide just this type of service. They provide inventory management that is flexible, relatively simple, and gives power to the consumer to help control inventory based on what is actually needed instead of historical models or guesswork.

REFERENCES

Frederick, James (2003). Upgraded distribution network grows supply chain, inventory capacity. Drug Store News, pg 15.

Reid & Sanders (2002). Independent Demand Inventory Management. Operations Management, Ch 12.

Reid & Sanders (2002). Just-In-Time Systems. Operations Management, Ch 7.