This document discusses inventory management and seasonal demand. It provides data on winter inventory levels over four years for 12 months. It includes typical demand patterns and discusses just-in-time inventory systems. Tables show raw inventory data and calculations of the mean, median, mode, and standard deviation for each year's data. The conclusion discusses the importance of forecasting accuracy for inventory planning.
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Exceutive management presentation
1. KAREN FAITH ADAMS, KAREN JONES
QRB/501 – QUANTITATIVE REASONING FOR BUSINESS
MARCH 26, 2012
ARI RAHMAN
2. Introduction
Inventory management systems are a vital part of
businesses
Observing inventory levels is necessary for creating
revenue and profits.
Mangers need to develop , analyze frequency
distributions, locate the mean, median and mode and
show a normal distribution of raw data collect
3. Just-In-Time Inventory System
Production and the purchase of materials do not begin until a customer
places an order for a product.
Eliminates waste and makes the company efficient
Companies are able to do away with their warehouses
Funds that were tied up in inventories can be used elsewhere
Defect rates are reduced, resulting in less waste and greater customer
satisfaction
10. Conclusion
Forecast accuracy is a critical component of Gilbarco’s success in today’s
markets, particularly when competing on a global scale.
Inventory is Gilbarco’s largest asset
Forecasting techniques are quantitative. Quantitative techniques of
forecasting are best used when changes are infrequent.
11. • Accounting For Management. (2011). Retrieved from
http://www.accountingformanagement.com/just_in_time.htm
• University of Phoenix. (2012). Winter Historical Inventory
Data, University of Phoenix Material.. Retrieved from University of
Phoenix
Editor's Notes
Just-In-Time (JIT) is an inventory system used by Gilbarco. With Just –In-Time production and the purchase of materials do not begin until a customer places an order for a product.. This allows Gilbarco to shrink their inventories to lower quantities or not having any on hand all. JTI has had many direct effects on the following inventories: raw material, work in process, finished goods. Old inventory systems would require the companies to have large quantities of resources to avoid any production problems. JIT allows enough materials to be purchased in order to cover the needs daily.
Gilbarco uses forecasting methods to predict current and future trends. Gilbarco uses the information to determine if the company will break even and if the company does not do well they can decide if the company will be able to maintain production the next year. The index is a point of reference concerning numbers with common points. Indices are used to observe historical and short-term comparisons with percentages change and commonly used. The chart above is example raw data that Gilbarco uses to help forecast the next five years.
The normal distribution is important because it describes the statistical behavior of Gilbarco inventory. The shape of the normal distribution is completely described by the mean and the standard deviation . Normal distribution curve is a statistical function that describes how data behaves around any given mean. Also known as a Gaussian distribution or bell curve, a normal distribution curve allows statisticians to analyze data and make predictions
The measure of dispersion that most accurately depicts inventory data is standard deviation. When you look at measuring dispersion you are looking to see how the entire spread of data actually measures to each other. Standard deviation presents how much the data will deviate from the normal number.
Data Source: University of Phoenix The table above shows the Frequency and Normal Distribution Data during the Winter Season. This was created to show the different results of Mean, Median, Mode, Range, and Standard Deviation.