Int. J.

Production Economics 81–82 (2003) 173–183

An organizational perspective on inventory control: Theory

and a case study
Leonieke G. Zomerdijk*, Jan de Vries
Department of Operations Management, Faculty of Management and Organization, University of Groningen, P.O. Box 800,
9700 AV Groningen, The Netherlands

Abstract

Inventory control is a well-covered area in literature. Nowadays, many concepts and techniques are available for
effectively controlling inventories. Eminent examples are stochastic models to determine order quantities, techniques
for forecasting demand and different kinds of ABC analysis. Remarkably enough, the theoretical backgrounds of these
concepts and techniques show a great deal of similarity: they all stem from the field of operations management and
operations research. Despite the value of the available concepts, such a one-sided approach has its limitations in
practice. In this article it is argued that it is important to take a broader view when dealing with practical inventory
control problems. First of all, an organizational perspective on inventory control is developed. The main idea behind
this perspective is the importance of the organizational context of inventories. This means that in addition to the
traditional points for attention, such as order quantities and replenishment strategies, other aspects need attention as
well. They are, for example, the allocation of responsibilities and authorities regarding inventory management, the
quality of inventory information and the relevant decision-making processes. These contextual factors as well as the
traditional factors are mapped out and integrated into a framework to be used in solving practical inventory control
problems. One of the main features of the framework is that it is useful in both analyzing and redesigning an inventory
situation. Secondly, this article describes the results of a case study regarding the application of the organizational
perspective to a practical inventory control problem. The central issue of the case study is the spare parts inventory of a
missionary aviation organization in Africa. The case study shows that the organizational perspective on inventory
control is very helpful in dealing with inventory control problems. It is illustrated that taking into account the
organizational context of inventories, especially the responsibilities and authorities of the persons concerned, is a
necessity to accurately understand inventory control problems. In addition, it is illustrated that the organizational
perspective leads to a more appropriate redesign.
r 2002 Elsevier Science B.V. All rights reserved.

Keywords: Case study; Inventory control; Organizational perspective

1. Introduction

During the last few decades inventory control

*Corresponding author. Tel.: +31-50-363-7020; fax: +31-
50-363-2032.
E-mail addresses: l.g.zomerdijk@bdk.rug.nl (L.G. Zomer-
dijk), j.de.vries@bdk.rug.nl (J. de Vries).
has been the topic of many publications. It may
fairly be called one of the classics in operations
literature. As a result, a large collection of

0925-5273/02/$ - see front matter r 2002 Elsevier Science B.V. All rights reserved.
PII: S 0 9 2 5 - 5 2 7 3 ( 0 2 ) 0 0 2 7 6 - 1
174 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
concepts and techniques is available for effectively
controlling inventories. There are for example
stochastic models to determine order quantities,
techniques for forecasting demand and different
kinds of ABC analysis. Recently management
systems such as manufacturing resource planning
(MRP) and enterprise resource planning (ERP)
have been added. However, most of these con-
tributions have similar theoretical background: the
field of operations management and operations
research. This means the concepts and techniques
are mainly based on mathematical assumptions
and modeling inventory situations. Although this
established approach to inventory control has
proved to be very valuable in determining inven-
tory parameters and planning resources, its value
can be questioned in dealing with practical
inventory control problems. Plossl and Welch for
instance state that many firms have inventory
control techniques working but they are not
reducing inventories. On the other hand, some
others are doing a fine job of managing the total
inventory investment even without these tools
(Plossl and Welch, 1979, p. 26). In addition,
nowadays’ authors realize that many of the
quantitative methods from the field of operations
management and operations research are insuffi-
cient to cope with today’s organizational complex-
ity (e.g. Hayes, 1998; Lovejoy, 1998; Machuca,
1998). These authors favor a broader scope on
operations management issues, including qualita-
tive aspects and linkages with other functional
areas in an organization. Therefore, there seems to
be a need for an extended view on inventory
control.
In this article we argue that it is highly
important to take the organizational context of
inventories into account when dealing with in-
ventory control problems. This means that in
addition to the traditional points for attention,
such as order quantities and replenishment strate-
gies, contextual aspects need attention as well.
They are for example the allocation of responsi-
bilities and authorities regarding inventory man-
agement, the quality of inventory information and
the relevant decision-making processes. These
contextual factors as well as the traditional factors
can be integrated into an organizational perspec-
tive on inventory control. The development and
practical application of this organizational per-
spective are the main topics of this article.
The article is organized as follows. First, the
organizational perspective on inventory control is
developed. To that end, the organizational context
of inventories is investigated to determine aspects
that play a part in inventory control. Second, a
framework is presented to facilitate the application
of the organizational perspective to practical
inventory control problems. The third section of
this article describes the research methodology of a
performed case study in which the organizational
perspective has been applied. The case study
regards the spare parts inventory of a missionary
aviation organization in Africa. Fourth, the results
following from the case study are presented. It can
be concluded that taking the organizational
context of inventories into account leads to a
better understanding of the problem and to a more
appropriate redesign of the inventory situation.
The final section of this article summarizes the
conclusions.
2. An organizational perspective on inventory
control
Within the area of operations management and
operations research many contributions regarding
inventory control can be found. Traditionally they
focus on three topics that are widely recognized to
play an important part in inventory control: order
quantities, order intervals and inventory control
systems. See, for example, Plossl (1985) and Silver
et al. (1998). The first topic regards order
quantities or how much to order. In order to
determine economic order quantities, several costs
associated with inventories play a part, such as
ordering costs and inventory carrying costs. The
second topic regards the order interval or when to
order. In this respect demand and lead-time
processes are important. Finally, the third topic
regards the inventory control system. Common
subjects concerning systems for controlling inven-
tories are ABC classifications and information
systems. These three aspects represent the tradi-
tional characteristics of an inventory situation. In
 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
addition, they are considered to be starting points
for improving inventory control. Over the past two
decades, as the field of operations management has
developed and matured, several new concepts have
been added to the list of relevant inventory control
topics. These more management-oriented topics
include MRP, just-in-time (JIT) and ERP (Hayes,
1998; Leschke, 1998). Although these recent
contributions have a more qualitative nature, they
show the same one-sided scope on inventory
control as the previous contributions. In fact,
most contributions pay little or no attention to the
fact that the majority of inventories are situated in
an organizational context.
From a practical point of view it seems that the
organizational setting of inventories should not be
disregarded. Being situated within an organiza-
tional context several other factors play a part in
inventory control. In general these factors lie
outside the field of operations management and
operations research but should nevertheless be
taken into consideration. Most factors regard the
organizational incorporation of inventories and
the associated information flows. A significant
example concerning inventory management is the
allocation of responsibilities and authorities. In-
ventory control problems can easily arise when for
instance nobody in the organization is responsible
for the inventory or the responsible person has
insufficient authorities to carry out the task.
Likewise, high inventory values indicating a lack
of control may just be the result of inaccurate
inventory records or of a reporting system that
does not function well. Thus, the organizational
context of inventories also contains several aspects
that can affect inventory control.
In order to identify significant aspects in the
organizational context of inventories four dimen-
sions can be distinguished. They are the allocation
of tasks, decision-making processes, communica-
tion processes and behavior of the parties in-
volved, as displayed in Fig. 1. First, the allocation
of tasks is an important dimension in the
organizational context of inventories. According
to Lovejoy (1998) this dimension should be part of
the foundations of an integrated view on opera-
tions management issues. Relevant characteristics
in this respect are the number of people that are
175
Task
Decision
making
Allocation
processes
Inventory
control
Communication
Behavior
processes
Fig. 1. The organizational perspective on inventory control.
responsible for inventory management, their func-
tional positions and their hierarchical positions in
the organization. Another relevant characteristic is
the fit between allocated responsibilities and
authorities. Each one of these characteristics might
influence the effectiveness of inventory control.
Second, organizational theory shows that deci-
sion-making processes form a significant organiza-
tional dimension (e.g. Daft, 1998). Like in other
organizational areas, many decisions are made in
inventory management, varying from annual
strategic decisions to operational decisions con-
cerning day-to-day activities. The resulting inven-
tory control is influenced by how these decisions
are made. Furthermore, the effectiveness of
inventory control depends on the ways in which
inventory decisions relate to each other and to
other decisions in the organization. It is evident
that, for instance, contradicting decisions or
decisions that are based on wrong information
can influence the effectiveness of inventory con-
trol.
Third, communication processes represent an-
other dimension in the organizational context of
inventories. As stressed by organizational beha-
viorists, communication is a key process under-
lying all aspects of organizational operations (e.g.
Greenberg and Baron, 1993; Robbins, 1993). In
this respect it is important to consider the influence
of communication processes on inventory control.
For example, the forwarding of inventory infor-
mation, the quality of that information and the
176 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
provision of feedback can have a large impact on
the effectiveness of inventory control.
The fourth and final dimension of the organiza-
tional context that is important with respect to
inventory control is the behavior of the parties
involved. Since the Hawthorne experiments in the
thirties it is widely recognized that social aspects
influence the functioning of organizations (Dess-
ler, 1986; Paul et al., 1994). Lovejoy (1998) points
out that human behavior should not be ignored in
operations management issues. In fact, social
aspects can be significant determinants of the
effectiveness of inventory control. For example,
conflicts might prevent people from passing on
important inventory information. In addition,
power can obstruct decision-making processes
concerning inventory. Likewise, motivational pro-
blems, uncertainty or incompetence influence the
ways in which inventory tasks are executed.
Therefore, it is important to consider not only
the formal aspects of the allocation of tasks,
decision-making processes and communication
processes, but also the informal aspects in terms
of behavior and underlying factors.
Hence, in the organizational context of inven-
tories four dimensions that play a significant part
in inventory control can be identified. These
dimensions should be taken into consideration
when dealing with practical inventory control
problems, additional to the traditional points for
attention following from the field of operations
management and operations research. The result-
ing approach can be called an organizational
perspective on inventory control. This approach
has two important characteristics. In the first
place, the concept of inventory control is looked at
from a multiform point of view. This means
attention is no longer focused on just order
quantities, order intervals and inventory control
systems. Instead, other aspects of inventory con-
trol, belonging to the fields of organizational
theory and organizational behavior, are high-
lighted as well. In the second place, the concept
of inventory control is looked at from an
integrated point of view. This means not only
several different sides of inventory control are
discussed, but also a great deal of attention is paid
to the coherence between the different dimensions.
This is an important aspect, since it is the
coherence that ultimately determines the effective-
ness of inventory control in a practical situation.
For example, suitable replenishment strategies can
be counteracted by inappropriate allocation of
responsibilities. In the same way undesirable
behavior may disturb sound decision-making and
communication processes. A lack of coherence can
easily arise as a result of conflicting interests. It is
generally accepted that organizational members
involved in for instance sales, production or
finance value inventories differently (Plossl, 1985;
Silver et al., 1998). Depending on their involve-
ment in determining aspects of inventory control,
there will be little or much coherence. Thus, it is
desirable to pay attention to the interaction
between the several dimensions of inventory
control rather than to traditional aspects or
communication processes separately. The next
section of this article presents a framework that
can be used to apply the organizational perspective
to practical inventory control problems.
3. An integrated framework
The employment of the organizational perspec-
tive on inventory control in practice can be
facilitated by means of the framework presented
in Fig. 2. The framework displays a way of
approaching practical inventory control problems.
It is based on a basic control loop to represent the
underlying problem-solving process. In general,
the starting point for a problem-solving process is
an inventory system that performs below pre-set
standards. In many cases, these pre-set standards
are defined in terms of costs. Some examples of
costs associated with the ‘performance’ of inven-
tory systems are storing costs, stock-out costs,
ordering costs and costs due to obsolescence. The
performance of an inventory system refers, how-
ever, not only to well-defined cost criteria.
Actually, the main purpose of inventory manage-
ment is to facilitate the smoothing between
supply and demand. So any symptom indicating
a lack of harmony between supply and demand
may refer to a poor performance of the inventory
system. Examples of some of these symptoms are
 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
Other influences
Inputs Performance
Inventory System
Standards
Redesign
Other influences
Fig. 2. Framework for solving inventory control problems.
instabilities in the (production) planning process,
the existence of numerous rush orders and
inefficient operation of production facilities. In
many cases a deviating performance of the
inventory system will activate a diagnosis of the
inventory situation in which several aspects
regarding inventory control are investigated (cf.
Fig. 2). The outcome of this diagnosis then serves
as input for the construction of a redesign of the
inventory system.
Within this framework, there are a few guide-
lines for the diagnosis and redesign phase
following from the application of the organiza-
tional perspective on inventory control. To begin
with, applying the organizational perspective on
inventory control in a problem-solving process
177
Standards
Measurement
Diagnosis
Deviation from
standards
Traditional Aspects
Allocation of Tasks
Decision Making
Processes
Communication
Processes
Behavior
Standards
partly determines the structuring of the
diagnosis phase of the process. The objective of
this phase is to achieve a clear insight in the
inventory situation under consideration and a
thorough understanding of the cause(s) of the
inventory control problem. To that end, the
inventory system needs to be described and
analyzed. With regard to describing an inventory
system it is important to obtain a comprehensive
description of the inventory system. The end result
should contain detailed descriptions of both
traditional aspects of inventory control and
aspects from the organizational context of the
inventory system. This is to ensure a large amount
of factors that might play a part in the inventory
control problem are included in the description.
178 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183

Therefore, the first guideline of applying the
organizational perspective on inventory control
in practice regards describing an inventory system
by paying attention to each of the five dimensions
that have been identified to play a part in
inventory control. The table in Fig. 3 can be a
useful tool to do so. The table presents an
elaboration of traditional aspects, the allocation
of tasks, decision-making processes, communica-
tion processes and behavior regarding inventory
control. Each dimension is divided into relevant
aspects and their characteristics. Although the list
of characteristics is by no means meant to be
exhaustive, it is composed in such a way that it will
lead to a fairly complete insight in an inventory
situation.
The second guideline of applying the organiza-
tional perspective on inventory control in practice
regards analyzing an inventory system. When
trying to determine causes for an inventory control
problem, all five dimensions should be taken into
account. It is important to begin with analyzing
each of the five dimensions separately and subse-
quently focus on analyzing the coherence between
the dimensions. This implies that firstly for each of
the dimensions it is investigated in what ways it
contributes to the inventory control problem. The
table in Fig. 3 can provide starting points for
identifying possible causes. This part of the
analysis might reveal for instance that an inap-
propriate replenishment strategy is applied or
that communication systems are not functioning

AN ORGANIZATIONAL PERSPECTIVE ON INVENTORY CONTROL

Dimension Relevant Aspects Characteristics

Size and determination of order quantities
Order quantities
Underlying costs (e.g. ordering costs, carrying costs)
Size and determination of order interval
Traditional
Order interval Characteristics of demand
approach
Characteristics of lead time
Type of system
Control system
Quality of inventory records
Amount of people
Allocation of
Horizontally: departments
responsibilities
Allocation of Tasks Vertically: layers of organization
Allocation of
Balance with responsibilities
authorities
Amount of information
Available information
Ambiguity of information
Decision Making Amount of decision makers
Decision makers
Processes Composition of group (e.g. including affected people)
Rationality of decisions
Decisions
Relation with other decisions
Nature of system, e.g. formalization and standardization
Reporting system
Acceptance by organizational members
Communication
Feedback Amount of feedback
Processes
Quality of information
Message
Amount of noise
Power games, politics, (de-) motivation, conflicts,
Behavior Social factors
uncertainty, ambiguity, incompetence etc.

Fig. 3. Overview of dimensions of inventory control.

 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
properly. Secondly, the findings from every
dimension are integrated to determine how the
dimensions relate to each other. For example,
malfunctioning communication systems might
cause the inappropriate replenishment strategy.
In addition, the malfunctioning communication
systems might be the result of an inappropriate
allocation of tasks. Doing so, it will become clear
what causes the inventory control problem from
an organizational perspective.
Besides guidelines for the diagnosis of an
inventory control problem, the organizational
perspective on inventory control also provides
guidelines for the redesign of an inventory system.
Based on an accurate understanding of the
inventory control problem, the redesign aims to
improve the situation or solve the problem by
means of recommendations. From the organiza-
tional point of view it is important to take all five
dimensions of inventory control into considera-
tion. However, unlike in the description and
analysis of an inventory system, the five dimen-
sions are not expected to be equally important.
Depending on the outcomes of the diagnosis of an
inventory system, it might be sufficient to redesign
just one of the dimensions. In other cases, a
redesign of the entire system might be required.
Still, in all cases it remains necessary to consider
each of the five dimensions, since they are closely
interrelated. For example, changing the allocation
of tasks can influence communication processes.
Likewise, improving decision-making processes
can solve behavioral problems. Therefore, the
third guideline of applying the organizational
perspective in practice regards redesigning an
inventory system by taking the five dimensions of
inventory control into account, although it is not
needed to change them all.
To conclude, the framework presented in Fig. 2
facilitates the practical employment of the organi-
zational perspective on inventory control. The
accompanying guidelines provide support in diag-
nosing and redesigning an inventory system. This
way of applying the organizational perspective to
practical inventory control problems is expected to
lead to more satisfying solutions. In the first place
this is due to the comprehensive description and
analysis of an inventory system. Compared to the
179
traditional approach to inventory control, the
organizational approach is more likely to capture
the complex environment most inventories are
situated in. This is expected to lead to a more
accurate understanding of the inventory control
problem. In the second place, more satisfying
solutions are to be expected because of more
appropriate redesigns. Traditionally, redesigns
were focused on changes in order quantities,
order intervals or inventory control systems.
However, it has been argued that in several
practical situations the organizational context of
inventories needs to be changed in order to
improve inventory control. Therefore, the organi-
zational perspective paying attention to both
traditional and contextual aspects will lead to
more appropriate redesigns. The next sections of
this article describe the research design and results
of a case study in which the organizational
perspective has been applied to a practical
inventory control problem.
4. Research methodology
The organizational perspective on inventory
control as introduced in the former sections has
been applied in a practical situation. This case
study regards the spare parts inventory of Mission
Aviation Fellowship (MAF) Europe. MAF Eur-
ope is an international missionary aviation orga-
nization that is part of a worldwide group of MAF
organizations. The purpose of the organization is
to multiply the effectiveness of the mission of the
body of Christ in areas of need through aviation,
information technology and logistical services.
Through these services MAF Europe is attempting
to enable national churches, international missions
and non-governmental organizations to provide
spiritual and social benefits to people in developing
countries. Today, MAF Europe programs are
located in Chad, Kenya, Madagascar, Tanzania
and Uganda, while a new program is being set up
in Mongolia. The headquarters of the organization
is located in the United Kingdom. In order to
provide its services, MAF Europe operates an
aircraft fleet consisting of almost 30 aircrafts in
eight different types, mostly from the Cessna
180 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
factory. In general, engineers in the programs
maintain the aircraft. To that end, every program
carries a spare parts inventory that is controlled at
the spot. In order to limit the amount of money
that is tied up in spare parts, the Board of
Directors of MAF Europe has declared that the
aggregate value of aircraft spare parts is not
allowed to exceed 7.5 percent of the insurance
value of the aircraft fleet. However, the MAF
Europe programs have been outside this constraint
for some time. In January 1999, the inventory of
spare parts had a value of $850,000 while the
aircraft fleet was insured for $10,000,000. That
results in a ratio of 8.5 percent. Therefore, the
organization was in need of a research study
leading to recommendations to improve the
situation.
The research study has been carried out during a
period of 6 months in which the researcher was
part of the organization and located in Africa.
Data were collected by interviewing people, study-
ing documents and analyzing numerical data.
Since there were indications that factors from the
organizational context were contributing to the
inventory control problem of MAF Europe, the
organizational perspective was adopted to ap-
proach the problem. The research performed can
be characterized by the framework presented in
the former section. First, the current inventory
situation in the MAF Europe programs was
described multiformly by means of the five
dimensions identified to play a part in inventory
control problems. Second, the current inventory
situation was analyzed in order to determine
factors contributing to the inventory control
problem. Both traditional and contextual aspects
were analyzed by using theoretical concepts
from the fields of operations management
and operations research or more organizational
literature, such as theories on motivation and
information. Third, following from the main
causes of the inventory problem in the MAF
Europe programs, recommendations for improve-
ments were presented. The recommendations
mainly regarded improvements affecting the orga-
nizational context of the spare parts inventories.
Together the recommendations were aimed at
more effective inventory control. The next section
of this article describes some of the findings of the
case study.
5. Findings of the case study
The main finding of the case study is the clear
value of the organizational perspective in solving
practical inventory control problems. Through the
application of the organizational perspective to the
inventory control problem of MAF Europe,
significant causing factors were brought to light
that probably would not have been recognized
when the problem was approached from a more
traditional point of view. Likewise, the resulting
recommendations regarded essential changes in
the organizational context of the spare parts
inventories that most likely would not have been
part of a traditional redesign. This is explained in
more detail below.
In the case of MAF Europe, the inventory
control problem was reflected in the high value of
the spare parts inventories, which caused the
programs to be outside the inventory constraint
imposed by the Board of Directors. Describing
and analyzing the inventory control problem from
the traditional perspective revealed that the MAF
Europe programs were applying a suitable control
policy for ordering spare parts. Despite some
minor issues, there were no factors that contrib-
uted significantly to the inventory control pro-
blem. Therefore, from this operations
management point of view the spare parts
inventory situation seemed to be in order. Re-
commendations that could be made regarded fine-
tuning order quantities and implementing the abc
classification. However, these recommendations
were not expected to solve the inventory control
problem of MAF Europe. In fact, the main cause
for the inventory control problem was to be found
in the organizational context of the spare parts
inventories.
Each of the four contextual dimensions con-
tributed to the inventory control problem. In the
first place, the allocation of tasks in the MAF
Europe programs hampered effective inventory
control. In the organization of MAF Europe Chief
Engineers are responsible for the spare parts
 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
inventories. However, the main task of a Chief
Engineer is to ensure maximum availability of
aircraft for operational use. Since it supports the
maintenance of aircraft, the engineers will natu-
rally pursue a large spare parts inventory. Second,
decision-making processes in the MAF Europe
programs influenced inventory control. This parti-
cularly regarded goal setting. For example, the
decision to limit the aggregate value of the spare
parts inventories to 7.5 percent of the insurance
value of the aircraft fleet was used as a goal.
However, for various reasons this goal was
unsuitable so that it had little effect. The third
dimension of the organizational context, commu-
nication processes, also played a part in the
inventory control problem of MAF Europe. One
communicational aspect that hindered effective
inventory control was the low quality information
that was used to determine the value of the spare
parts inventories. Fourth and finally, there were
behavioral aspects that contributed to the inven-
tory control problem in the MAF Europe pro-
grams. Although power games, politics and
conflicts were not involved, a lack of clarity played
a part. This made for instance that certain
inventory procedures were not followed.
Besides analyzing the five dimensions separately,
the inventory system as a whole has been analyzed
as well. This revealed that the dimensions were
closely interrelated. For example, the allocation of
tasks in which engineers were responsible for the
spare parts inventories caused traditional inven-
tory characteristics, such as order quantities and
replenishment strategies, to be aimed at large spare
parts inventories. In addition, this was enabled by
a lack of supervision due to an inappropriate
allocation of responsibilities in the hierarchical
layers of the organization. In the same way, this
inappropriate allocation of tasks caused commu-
nicational problems such as a lack of feedback.
Furthermore, the decision-making processes in
MAF Europe induced certain behavior damaging
inventory control. Finally, a combination of the
allocation of tasks, communication processes and
behavior of the parties involved caused inventory
information to be of low quality. To conclude, the
organizational context of the spare parts inven-
tories in the MAF Europe programs consisted of a
181
set of interrelated factors, i.e. regarding the
allocation of tasks, decision-making processes,
communication processes and behavior, that con-
tributed to the ineffectiveness of the control of the
inventories. Therefore, from the organizational
perspective on inventory control the spare parts
inventory situation was not in order at all.
In accordance with the findings from the
diagnosis the spare parts inventory situation in
the MAF Europe programs has been redesigned.
Two major recommendations were made to the
organization. They mainly regarded changes in the
organizational context of the spare parts inven-
tories, as the main causes for the inventory control
problem stemmed from the organizational context.
Since there were a number of factors contributing
to the inventory control problem, the recommen-
dations were focused at aggregate solutions laying
foundations for further improvements. First of all,
it was recommended that MAF Europe replaces
the current inventory constraint by another goal
that would be more suitable. Having an appro-
priate goal to compare the programs’ performance
to is an important requirement for effective
inventory control (Plossl and Welch, 1979).
Although the inventory constraint in its current,
aggregate form can remain as a tool for top
management, it has to be translated in inventory
values for the individual MAF Europe programs.
It was recommended this should be done by
defining end-of-year inventory values per pro-
gram, like a budget. This recommendation will
have an effect on decision-making processes and
subsequently behavior of the parties involved in
inventory management. Second, it was recom-
mended that MAF Europe improves its informa-
tion flow by means of communicating inventory
procedures and adopting a new reporting system
for inventory values. These changes will affect
communication processes and behavior in the
MAF Europe programs. The proposed reporting
system also affects the allocation of tasks. Doing
so, the spare parts inventories in the MAF Europe
programs will most likely be controlled more
effectively.
In conclusion, applying the organizational
perspective to the inventory control problem of
MAF Europe has given the organization a
182 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183
comprehensive description and analysis of its spare
parts inventory situation. In itself, this informa-
tion can already be of large value to the manage-
ment of the organization. Furthermore, MAF
Europe has received recommendations that are not
that evident from an operations management
point of view, but nevertheless are important. In
fact, they are essential starting points in order to
improve the control of the spare parts inventories.
Hence, from this case the conclusion can be drawn
that the organizational perspective is indeed
valuable in solving practical inventory control
problems.
6. Conclusion
From the above several conclusions can be
drawn. First, this article has lead to a broader view
on inventory control. This broader view regards
the organizational perspective on inventory con-
trol that has been developed. The main idea
behind this perspective is the importance of the
organizational context of inventories for the
effectiveness of inventory control. It has been
argued that the traditional approach to inventory
control from the fields of operations management
and operations research pays little or no attention
to the organizational setting of inventories. How-
ever, the organizational context of inventories
contains several factors that play a part in
inventory control. They have been identified as
the allocation of inventory tasks, decision-making
processes regarding inventory, communication
processes concerning inventory information and
behavior of the parties involved in inventory
management. In the organizational perspective
on inventory control these four dimensions are
taken into account along with traditional aspects
of inventory control. It can be concluded that this
organizational perspective on inventory control
can be of large value in practice. The case study
regarding the spare parts inventories of MAF
Europe has shown that factors from the organiza-
tional context of an inventory can indeed play a
significant part in inventory control problems. In
particular, the case study has emphasized the
importance of coherence between the dimensions.
Second, in this article a way of approaching
practical inventory control problems from the
organizational perspective on inventory control
has been developed. This approach consists of a
set of guidelines referring to a problem-solving
process. In the first place it has been argued that a
diagnosis of an inventory system should contain a
comprehensive description. This means both tradi-
tional characteristics of an inventory system and
the four dimensions in the organizational
context of an inventory should be described.
Secondly, it has been argued that an inventory
system should be analyzed by paying attention to
each of the dimensions separately and subse-
quently to the coherence between the dimensions.
Thirdly, when redesigning an inventory system
each of the traditional and contextual dimensions
should be taken into consideration, although it
might not be needed to change them all. This is
due to the interaction between the dimensions.
It can be concluded that this proposed set of
guidelines is a helpful tool in solving practical
inventory control problems. It aids in system-
atically applying the organizational perspective
on inventory control. The case of MAF
Europe has shown that this way of applying the
organizational perspective leads to a more accu-
rate understanding of an inventory control pro-
blem and a more appropriate redesign of an
inventory system.
Nevertheless, future research is required for the
organizational perspective on inventory control to
grow in size. This article has initiated its develop-
ment, but it mainly focused on the creation of an
instrument that would be most useful in practice.
Therefore, further research needs to be conducted
to consolidate the foundations of the perspective.
In this respect the relation between the organiza-
tional context of inventories and the effectiveness
of inventory control needs to be investigated in
more detail. In particular, it is worthwhile to
explore the specific contributions of the dimen-
sions that have been identified in this article
research is likely to contribute to a refinement of
the guidelines proposed in this article, so that the
practical employment of the organizational per-
spective on inventory control will be further
improved as well.
 L.G. Zomerdijk, J. de Vries / Int. J. Production Economics 81–82 (2003) 173–183 183

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