HM14 Case Study

Poor Inventory Management - lacking of raw materials

 OVERVIEW
In the grounds of the manufacturing industry, effective inventory management is
crucial for ensuring that production can run smoothly and efficiently. However,
when raw materials are not properly tracked or managed, it can lead to serious
problems that can impact the entire production process. In this case study, we
will explore the impacts of poor inventory management on a manufacturing
company that is experiencing a lack of raw materials. We will examine the
causes of this issue down to its very core and the steps that the company can take
to improve their inventory management practices and prevent similar problems
from occurring in the future. Let's dive in!
 ROOT CAUSE
1. 2. 3.

Inaccurate Demand Poor Communication Inefficient Inventory

Forecasting with Suppliers Tracking Systems

4. 5.

Inadequate Safety Lack of Contingency

Stock Planning
 These solutions address the root
causes of the problem and help

SOLUTION prevent future inventory shortages,

ultimately leading to better
customer satisfaction and
profitability.
 Solutions to address poor inventory management
and the lack of raw materials:

Solution 1 Solution 2 Solution 3

Improve Develop Implement

Demand Supplier Inventory
Forecasting Relationships Management
Software
Best Solution
IMPLEMENTING INVENTORY MANGEMENT SOFTWARE

With inventory management software, tasks are performed automatically,

leading to a more efficient management task and reducing the risk of stock-
outs, which may be a waste because the money is sleeping as opposed to
being put to use for a more valuable purpose that can benefit the business,
or overstocking, which is essentially the same as throwing money away. The
remainder will fall into place when a particular approach is strictly put into
effect, yet only with guidance, discipline, persistence, open communication,
and complete transparency onboard.

Look for software that is tailored to the
hospitality industry and has features that
allow you to track raw materials.
Establish a system to track inventory
levels, such as setting reorder points,
so you are alerted when it is time to
order more raw materials.
Use the software to generate reports
and analyze your inventory data
regularly, so you can make informed
decisions about ordering and
managing your raw materials.

Create a system Regularly review

Choose the Set up your Train your
for tracking and analyze your
right software system inventory levels staff inventory data

Once you have chosen your software, set Make sure your staff is trained on
up your inventory system by entering all how to use the software and
of your raw materials into the software and understand the importance of tracking
categorizing them appropriately. inventory.
 Input Transformation Model
Environment

Regulation Suppliers
Competitors Economy
Technology

Inputs Outputs

Capital Materials
Transformation System Facilitating Goods
Equipment Facilities Services
Alteration Storage
Labor Suppliers
Transformation Inspection
Knowledge Time
Data Action Data Data
Action
Monitoring and Control
 Process Flow
Lamp lacking of raw material

Dir. of Sales
 max growth

Impact
XX% sales increase
MEMBERS:
Almason, Kheshannah Marie

Cabaral, Althea Fyron

Gilbuela, Mitchie

Piliotas, Christine Harain

Gregorio, Yoebert

Lugto, Gian Carlo