A stock of items held to meet future

demand
Inventory is a list for goods and
materials, or those goods and materials
themselves, held available in stock by a
business.

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Work in
process
Vendors

Raw
Materials

Work in
process

Finished Customer
goods

Work in
process

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Raw Materials Basic inputs that are

converted into finished product through the
manufacturing process
Work-in-progress Semi-manufactured
products need some more works before they
become finished goods for sale
Finished Goods Completely manufactured
products ready for sale
Supplies Office and plant cleaning materials
not directly enter production but are necessary
for production process and do not involve
significant investment.

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Ensure a continuous supply of raw materials to

facilitate uninterrupted production
Maintain sufficient stocks of raw materials in
periods of short supply and anticipate price
changes
Maintain sufficient finished goods inventory for
smooth sales operation, and efficient customer
service
Minimize the carrying cost and time
Control investment in inventories and keep it at
an optimum level

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Meet variations in customer demand:

Meet unexpected demand
Smooth seasonal or cyclical demand

Pricing related:
Temporary price discounts
Hedge against price increases
Take advantage of quantity discounts

Process & supply surprises

Internal upsets in parts of or our own processes
External delays in incoming goods

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To maintain a optimum size of inventory for

efficient and smooth production and sales
operations
To maintain a minimum investment in inventories
to maximize the profitability
Effort should be made to place an order at the
right time with right source to acquire the
right quantity at the right price and right
quality

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-Track inventory
How much to order
When to order

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When a submarine arrives at the Pearl Harbor Naval Shipyard (PHNSY), it

undergoes a well-planned schedule of maintenance, overhaul, repairs, and
upgrades.
On-time completion of these and other maintenance-type operations play
a major role in maintaining the readiness of submarines in the Pacific.
To ensure these critical deadlines are met, PHNSY relies on skilled
mechanics in three shifts a day and some weekends.
According to Iris Seiki, PHNSY Supply Systems Analyst, not having
inventory readily available for the mechanics on all three shifts and
weekends has a direct impact on the project and on other people's job.

Problems:
stores tooling, personal protective equipment (PPE), and consumable
products in centrally located tool rooms.
With the exception of the occasional walk and wait time to and from the
waterfront tool room, getting the needed items for the task at hand was
generally a simple process
Because the tool room was staffed for the first shift only, getting materials
was somewhat more complicated for the other shifts.
If the mechanic from the previous shift didn't turn over the materials to the
next shift, he/she would have to submit an item request for the needed
materials for the task at hand.
the materials came 24 hours later.

Problems:
-Work stoppage due to inefficient processes
-Wasted time walking to and from tool room
-Inventory shrinkage

PHNSY looked to WinWare, Inc., the makers of CribMaster to provide a

solution.

CribMaster is a set of inventory solutions used in military and other

industrial-type environments.

In their search for a storage system that offered flexibility, PHNSY

chose a suite of ToolCube point-of-use devices

Located them dockside where the submarines undergo maintenance.

The ToolCube is a large, heavy- gauge-steel constructed cabinet

that contains drawers and compartments of various sizes

Tasks performed by Toolcube

TM

The mechanic simply scans his/her badge and selects the item
requested.
CribMaster then provides access to only the approved quantity of
the exact item requested.
With the ToolCube's unique storage system of configurable
drawers, PHNSY could accommodate many different types of
inventory.
The capability of adding more devices as their operation grew and
controls needed to be tightened.

Stock-outs in their consumable materials have been greatly

reduced.

The min/max feature on the software ensures optimum inventory

levels by sending an email alerting someone when replenishment
is needed.

More importantly from the mechanics point of view, they enjoy

having the right material at the right time 24 hours a day, 7 days
a week.

This has allowed them to do their job regardless of which shift

they are working and allowed PHNSY to control material usage all
at the same time.

CASE STUDY - BOEING (UK)

Unrivaled Accuracy: RGIS Pilots Inventory Program for UK
CH-47 Chinook
CHALLENGES:
-In May of 2006, Boeing formally commenced work on the Through
Life Customer Support programme for the Royal Air Forces (RAFs)
fleet of Chinook helicopters.
-Boeing had previously manufactured and sold the Chinook
helicopters and parts to the RAF.
-Prior to the awarding of this maintenance contract to Boeing, the
RAF maintained these helicopters in-house and managed the
tracking of parts in stock with two inventory systems.
-The value of the parts varies from a few pence to over 1,000,000
per item.
-The parts are located on RAF/MOD installations in the U.K. and
around the world.

CHALLENGES:
-The information had to be viewed separately, consolidated, and
then reported globally back to Boeing and the MOD.
- Parts in stock are assigned a designated location within a base.
-For security reasons, an individual stock item may have several
locations within a base.
-This meant there was no central view of which parts were at which
base, or at what location(s) on a base a part was stored.

SOLUTION:
-RGIS staff members worked with Boeing, RAF/MOD, and DARA to
complete this project.
- RGIS provided auditors along with managers and operations support
personnel working across five U.K. bases.
-The RGIS program was divided in three steps:
The RGIS ProcessPre-Inventory
The RGIS ProcessInventory:
The RGIS ProcessPost-Inventory:

The RGIS ProcessPre-Inventory:

RGIS worked with Boeing in a tight schedule window, to
accomplish the inventory in one week less than was initially
required.
Scheduling challenges included the following:
>The very limited availability of RAF/MOD and DARA staff, who
were required to assist with locating and opening some parts
containers
>The requirement that the same part had to be counted in all
locations around the world at one time
>Part counting had to be completed in a specified four-hour
window or else that count would be invalidated in other locations.
>RGIS created a custom inventory programme to facilitate the
many and varied streams of information that were required

The RGIS ProcessInventory:

RGIS captured and reconciled the data at the five U.K. bases.
Parts were categorized according to class and condition and
whether the item was removed from an aircraft for repair.
Counts were compared to the quantities on record in the RAF
databases
Variance reports were generated in real time.
Items showing discrepancies were recounted.
Fully reconciled data had to be made available twice daily.

The RGIS ProcessPost-Inventory:

RGIS provided Boeing with a consolidated file showing the global
position of each parts line captured compared to the quantity
expected at the time the item was counted.
Interim reports and final information were provided on the secure
Boeing website for ease of access by those with permission to view
the data.
Boeing and the MOD were able to obtain an accurate inventory count
They could more readily identify where they would have an urgent
and immediate need for parts.

BENEFITS:
RGIS provided an accurate, reliable and efficient inventory
resulting in improved product availability and process
improvements for the future.
Excellent track record in accurate and consistent data-gathering
techniques across multiple sites
Proven scheduling flexibility
Effectiveness in working with multiple project partners
Efficient project coordination and data reconciliation abilities
Employee integrity
RGIS provided an inventory program that helped Boeing reduce
their costs and improve their processes.

Case Study
Inventory Management System
Manufacturing Company
Problems:

A global manufacturing company was experiencing

inefficiencies in in its inventory management processes.
With suppliers across the world delivering parts for the
company's products
Multiple buyers within the company are responsible for
tracking the parts required for each product from the
manufacturing phase through delivery
The company needed a way to keep a master list of all
inventory with easy access to parts' delivery statuses and other
pertinent information relevant to the company.

Approach:
Aciron initiated the project by holding extensive interviews with client
personnel to understand the companys needs and challenges.
Aciron followed an agile, iterative, approach to application development
Allowing the client to regularly review and make adjustments to the
application, and to easily incorporate the clients' evolving requirements.
Throughout the project, Aciron focused on open communication, with
regular status reports and meetings.
Consistently engaging key client personnel and ensuring project
milestones were met on time and within budget.

Solution:
Aciron developed a custom database driven inventory management
application
Application enables the company's multiple buyers, regardless of their
locations, to easily track, manage, and generate reports regarding the
company's inventory and deliveries
The user interface of the application was developed to be clean and userfriendly, enabling users to easily navigate and utilize the system.
The intuitive automated system provides the client with a rapid,
accurate, and efficient means to collect, process, transmit, record, and
manage inventory data.
Providing a clear view of any inventory shortages and delays, along with
comprehensive communication tools
The system eliminates the need to rely on traditional means of
communications, such as phone and email, etc., to manage such delays
The system also includes an extensive set of reporting mechanisms to

Benefits:
With on-demand access to up-to-date detailed data on the
company's inventory, the client is able to make more informed
decisions.
While reducing costs and inefficiency within the company. In
addition, as a browser based application
The system eliminates the inefficiencies inherent in using multiple
spreadsheets and manual processes involved in tracking and
managing inventory by creating one secure, central solution.
Since completion, the system has proved to be a critical business
application for the client, driving productivity and increasing
margins, while reducing costs