Strategic Inventory Planning for Uncertain Times
In response to internal and external disruptions in the material supply chain, especially under critical conditions, this article explores a conceptual model introduced by Singh & Verma (2018) for managing inventory systems effectively. By combining past experiences with adaptive self-assessment methods, the model creates a feedback loop that strengthens decision-making at every level of the supply chain.
What Is a Supply Chain?
A supply chain is a network of processes that links suppliers, manufacturers, and customers to efficiently deliver raw materials and finished goods. Its goal is to synchronize inventory flow from suppliers to end users, ensuring optimal delivery of resources and finished products.
Understanding Inventory
Inventory includes raw materials (natural or synthetic), in-process materials, and finished goods. As a key business asset, inventory needs to be well-managed to ensure availability, reduce costs, and maintain operational efficiency.
Causes and Management of Inventory Delays
Effective inventory management aligns multiple variables including:
- Supplier capacity and production volume
- Lead times and transportation
- Demand forecasting and warehouse space
- Quality control and defective returns
A good inventory system plans, organizes, and controls stock to reduce investment while ensuring availability, often guided by KPIs (Key Performance Indicators).
Core Features of Efficient Inventory Management
- Order Management: Price optimization, invoice handling, shipping coordination
- Transportation Control: Real-time tracking to reduce shipment errors
- Warehouse Planning: Stock placement to maximize value and safety
- Purchasing Strategy: Demand forecasting and market regulation
- Inventory Tracking: Supply chain-wide stock location visibility
- Reporting: Data analytics to identify bottlenecks and improvement areas
Key Responsibilities of a Supply Chain Manager
- Monitor material flows from sourcing to delivery
- Balance demand with supply chain resources
- Build strategic supplier relationships
- Oversee logistics and storage operations
- Control upstream and downstream communications
- Innovate through technology adoption
Inventory Management in Crisis Conditions
In unstable macroeconomic conditions, supply chain decision-making becomes more complex. To address this, Singh & Verma (2018) introduced a five-step dynamic model:
- Issue Identification: Observe and document existing inventory challenges
- Research Review: Explore academic and industry findings
- Hypothesis Design: Develop theories based on previous patterns
- Execution and Feedback: Implement solutions, monitor results
- Continuous Improvement: Adjust systems through self-evaluation
This approach encourages organizations to apply real-time learning and feedback to rapidly evolve their supply chain response strategies.
