This case study examines inventory management challenges faced by companies during the COVID-19 pandemic. It discusses three types of manufacturing inventories and how inventory is essential for production and distribution. The pandemic has greatly impacted many businesses and their ability to manage inventory. Alternative strategies discussed include inventory control techniques, change management, outsourcing work-in-process, and adding capacity safely. The recommendation is that companies implement new strategies to make inventory reliable for customer needs while providing income opportunities for workers.
1. A Case Study
Topic: Inventory Management
Introduction
Inventory management is the resources of goods and materials wherein it holds
the ultimate goals of resale used in the organization. There are three types of
manufacturing inventories: the raw materials, the processing of goods or products and
the finished products.
One of the companies common challenging problem area is their inventory
management. It is very important for a company to have its own inventory in warehouse
in order for them to fulfill the customers' demand.
But looking on our situation, companies are experiencing a huge challenge in
pandemic that spreads out all over the world and brought them into loss of money or
profit for their organization. Although some are opening their businesses again to make
an opportunity for their employee and to help the economy to rise again. However, this
inventory have its holding costs and needed to be fund to make the company operate
again.
This paper represents a case study that understands the supply chain
management by choosing the inventory management as a topic issued and make this
paper realistic and relevant to others.
Background Information:
Inventories are materials that are sources of distribution of finished products to
consumers. It is essential for keeping the production wheels moving, keeping the
market going and the distribution system intact at all times. Inventory is part of the
company's assets and is always been smooth and efficient to the company's
manufacturing total operations. Although, the management can be concerned if the
inventory stocks are high, however, it can be very critical about any shortages of
inventory items required for production especially during this times when people are in
quarantine due to lockdown.
2. Alternatives:
• Inventory Control Techniques
The inventory control is not only looking at the physical balance of various materials but
also looking to the aspects of minimizing the cost so that most of the items are available
when needed and easily to be consumed.
• Change Management
Change management is the discipline that guides how we prepare, equip and
support individuals to successfully adopt change most especially during this times when
the production of basic necessities are needed in order to drive organizational success
and outcomes.
• Secure Demand
Companies provide network-wide stock outs to some retailers for them to reach directly
for consumers. They will need to successfully passed on the knowledge and information
regarding to the changes across the purchasing, planning, and inventory-management
operations for their employees and customers to give them opportunity regarding to the
situation which is correlated to the change management.
▪ Add capacity - safely
To move inventory around quickly, it will also needs to reassign their staffs to have
enough coverage of key categories and products - where demand trends for non
discretionary and discretionary goods that are selling fastest.
Keeping distribution-centers or inventory warehouse's workers healthy during the
pandemic, requires taking added and necessary precautions. Maintaining good
workplace hygiene is also important. Between shifts at their inventory centers
employees can suspend their operations so that there will be enough time to sanitize
the equipments.
3. Solution:
Work in process. It is possible to reduce the amount of inventory that is being worked
in the production process, which further reduces the inventory investment.
Outsourcing. Inventory control can also involve decisions to outsource some activities
to suppliers, thereby shifting the inventory control burden to the supplier (though usually
in exchange for reduced level of profitability.)
Inventory management is essential to every company that needs every time to
have a stock, in such amount to avoid out-of-stock and overstock situations. Besides, in
our situation, it can be concluded in every changes in the environment that can propose
better results. This can be done through human decisions and support for their demand.
Recommendations:
It is clear that every inventory of the company can possibly operating after being
lockdown. They will just implement a new set of ways to make the inventory of the
company reliable for every needs of the customers and to make an opportunity to their
workers to have their own income.
For future development: To maintain the sustainable development and stay ahead
with the company, it must be applied the new ways of strategies through the alternatives
chosen to improve their processes for cost saving and customer satisfaction.
Additional Questions:
1. Due to the current pandemic, list some businesses you think that have been much
affected due to our situation:
Call centers, Agency Companies, Resorts, Airports and Terminals, other beverages
company like Coca-Cola Philippines, fast food restaurants like Jollibee, other delivery
services are also affected like LBC Express, J&T Express (used in online shopping like
Lazada and Shopee) but some of them are operating again because of some areas that
are already in the general community quarantine. And most especially are the
companies that produce the inventory of products that are essential like foods and
materials that are needed for daily use like face masks and alcohols.
2. How do you diversify those businesses now simultaneous to CoVid 19?
4. By using our situation to improve the products and services. Use this kind of strategy to
step-up and address the opportunities to make a possible movement in times of crisis.
Try to look for partnership opportunities in other business to make those alternatives
above can be implemented and build a long term-relationship to keep the businesses
wheels going. Also, try to organize your employees in a new set of schedules of work
and to make things possible, try to slash a budget for them to innovate their skills and
give them atleast a benefit that will make them valued as an employee. Most
importantly, respond to each and everyones feedback by looking of some unseen
changes ahead in the company and discussing professionally with your employees.