Case Study -- This case study has four parts:

Part (I) – Prioritizing SKUs to QA:

Your team is tasked with going to each express warehouse to conduct daily inventory audits (identifying
difference between system and physical inventory + identifying expired and damaged products).

You have a list of 500 SKUs to audit. However, you only have 2 people in your shift – each of whom can audit
only 100 SKUs. Which 200 SKUs from the list will you make your team audit and why? Please include
your analysis.

1. In 500 SKUs we will have three different kinds of units which include (Fresh items, frozen items and
Running/ Conventional items)

2. As we can only audit 200 units, so we have to prioritize accordingly. (Proposed Solution is given in the
excel sheet attached)

(a). Products having short/ close expiry date

(b). Products which are/ can be damaged
(c). Products different in System Inventory and Physical inventory
(d). Fresh and Frozen items

Part (II) – Calculating Disposal Value:

Your team has conducted the audit for each warehouse and captured the data for system vs physical
inventory.

Your task is to calculate the difference in value (in terms of rupees) between the inventory in the
system and what is present physically for each warehouse. Please include your analysis.

1. The difference in value between the system inventory and the physical inventory can be calculated,
System inventory and Physical inventory has been multiplied with the unit cost of each unit to obtain total
amount for both the inventories. Then their difference has been calculated which indicates the value in terms
of rupees. (Proposed Solution is given in the excel sheet attached)

2. It suggests inventory products should be updated timely and there shouldn’t be any difference in both
inventories and as it shows the inefficiency

Part (III) – Identifying Warehouse with Poor Inventory Management and Determining Solutions:

What solutions would you give it to improve its inventory management?

1. Inventory management depends on Key Performance Index which include picking time and skipped
item which reflects inventory team performance. For improving the inventory management following methods
can help

(a). Human Capacity Development

(b). Perpetual inventory management
(c). Infrastructure of warehouse
(d). Regular Auditing
(e). ABC analysis
Part (IV) – Team management

One member of your team has been coming late to work every day for the past 2 weeks which is impacting
the overall performance of the team and setting a poor precedent for the rest of the team.

1. Coming late is a negative attitude that should be handled positively, to prevent its influence on other
team members. Hence, as a manager, I will call him/ her to my office to address the issue. However, I will first
have a conversation with him/ her to know the cause for being late to ensure that if he/she a have valid
reason, so both of us can think of a way to solve it together or we can report to senior management. On the
contrary, if he/ she doesn’t have valid reason I will give verbal warning and if he/ she continues this behavior I
will talk to the senior management or whatever the policy of company suggests about this charge