Title: Inventory management and ABC analysis practices in competitive environments

Authors: Alan D. Smith

Addresses: Department of Management and Marketing, Robert Morris University, Pittsburgh, PA 15219-3099, USA

Abstract: The inventory management practices of six major companies/institutions in various industries were compared with recommendations for improvement by using the ABC analysis inventory management method. The ABC analysis tool was found to be beneficial to most companies discussed in this paper, with several companies already utilising the basic principles behind the method, either manually or with the use of an enterprise resource planning (ERP) system. However, a number of technologies must be in place to make inventory management systems successful as data capture techniques are needed to pass inventory-based information to the ERP system. At the highest levels, ERP systems manage the data and ensure customer fulfilment and a detailed analysis describing how a global company improved inventory management metrics by incorporating ABC analysis was included.

Keywords: ABC analysis; benchmarking; economic recessions; enterprise resource planning; ERP; inventory management; competitive environments; competitiveness; Goodrich Corporation; aircraft; landing gear; Great Lakes Cheese Company; food manufacturing; private-label manufacturers; Immediate Pharmaceutical Services; medical prescriptions; mail order pharmacies; Robinson Memorial Hospital; healthcare; Summa Health Systems; Sara Lee Bakery; bearings; power transmissions; Timken; inventories; progressive hospitals; USA; United States; Ohio; multinational corporations; MNCs; data capture; data management; customer fulfilment; global companies; globalisation; inventory metrics; service quality; procurement management.

DOI: 10.1504/IJPM.2011.041094

International Journal of Procurement Management, 2011 Vol.4 No.4, pp.433 - 454

Published online: 31 Jan 2015 *

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