The Efficient Organization
Waste Not, Want Not
we think of inventory, we typically think of the manufacturing
industry, but businesses in any sector have inventory: Food, retail,
service, government, not-for-profit, professional associations...name
the business and it's a guarantee that the business deals with
inventory. Inventory is necessary for business operations, but when
supply exceeds demand, problems arise, especially in the organization's
forms and publications as an example. Many organizations produce both.
Now think about how many forms and publications your organization has
stockpiled not only in one department, but perhaps in several. Excess
inventory hurts not only your bottom line, but your reputation, as well.
If you're a bank with piles of loan applications lying around your
office, what does that say about you to the customer? Or if you've got
outdated stationery stock or computer equipment lying around your
workplace, what image are you portraying to not only your customers, but
to your staff, as well? On top of this, the "clutter" reduces employee
morale and inhibits creativity and excellent work performance.
exactly the right amount of inventory to meet your turnover rate is
possible. Start by determining root causes of the excess inventory and
then identify solutions to eliminate the root causes. Some root causes
may include long lead times, poor forecasting accuracy, quality
problems, or design obsolescence. Eliminating root causes of
low-turnover inventory will prevent arbitrary year-end reductions in
with outstanding inventory performance also excel on other dimensions
such as customer service, delivery, and productivity. And if your
organization is not exceling in those areas, then it is underperforming
and losing money.