Inventory Models
During my course of supply chain and logistics management, I have been able to understand different topics and materials related to supply chain and it has helped me understand the overall course. I have been able to understand that supply chain is commonly a network among the company and its suppliers. Supply chain is associated with different factors including production, warehousing, inventory management and other factors which I think is essential to understand in order to improve the overall condition. In the following section, I will describe my understanding of four concepts which I have learnt from week 8 to week 13 and I will describe the same using my through knowledge and understanding.
The first model which I am describing is inventory model and its use in the purchase of products. I have found that the single period inventory model is usually used when there is only one time purchase of the item. For instance, if there are any sports event which is occurring for the first time, the single period model can be used.
Further, as per my view the flexible order quantity model (Q) is generally used to maintain in stock level and to restock different number of units that has been ordered. However, in this instance, I think it is essential to understand that when maintaining and understanding the level of inventory, proper monitoring of level of risks are essential. In this model, I have found that the inventory level must be always monitored and the process is more automated and are very expensive. Therefore, I think not every manufacturing process can use the model due to the complexity and expensiveness of the process. There are some assumptions associated with the fixed order quantity model (Q) which I think should be understood in order to comprehend the overall process. For instance, in this model, the demand for the product always remains constant and lead-time is always constant. Further, the price per unit of the product is constants and all other variables related to the product is constant.
Further, the flexible time period model (T) can be also used when the order is placed at some time intervals and I think that item is only used when it is in stock and are ready to be used. In this mode, there are various characteristics associated which needs to be understood in order to comprehend the use of the inventory model against the stocks of a company. I have found that the counting period is only used when it is at the end of the review period. The model always requires very less expensive items to be operated and are very less expensive for implementation. In the flexible time period model (T), I have found that the demand, lead time as well as review period is flexible and they can be consistent. In this case, I have found that the demand is revised and forecasted in each review period and the use of yearly average can be appropriate if the demand is not properly distributed.
Flexible Order Quantity
The primary fundamental principal of warehousing remains in storing inventory with the logistics pipeline. I have also found that the warehousing model is used to coordinate the product supply as well as consumer demand. The warehousing can be noted as a bridge between the production and the marketing. I have found that the term strategic warehousing can be used in the wholesaling and the retailing industry to technically improve and implement inventory deployment process. With the changes in the consumer demand, the warehousing system can be implemented and can be supported with the help of inventory replenishment. As per my understanding, the shift from the passive storage system to the strategic inventory assortment can be termed as the strategic warehousing.
The strategic warehousing system includes the distribution centre which is used to capture the dynamic development in the traditional warehousing and are also used to create the efficiency. As per my understanding, it has been found that the distribution centre is used to offer various ways to hold materials and parts. I have found two primary advantages of the outbound process. Primarily, the logistical process during the process is greatly reduced and a firm that is implementing the strategic warehousing can take the advantage of the consolidated transportation. Further, a firm employing the strategic warehousing can reduce the inventory of slow moving products. I have perceived that the strategic warehousing technic has been associated with various goals which offers maximum profitability to an organisation. Primarily, the flexibility of the distribution system can be greatly reduced with the help of the strategic warehousing system. Further, the use of technology can allow in better handing the storage functions. With respect to the customer demand, the strategic warehousing system can respond with the changes in services. I have perceived that the strategic warehousing system can be used to support for the customer requirements and can allow direct shipment from the manufacturing plans and thereby improving the responsiveness of the overall manufacturing process. Further, this system can allow in placing the inventory in different market adjacent to the key customers before the high seasonal sales that can improve the profitability and overall situation of the company. The customers can gain the one stop shopping capabilities with the help of the strategic warehousing method. Further, this method has been also found to reduce the number suppliers per customer thereby reducing any existing hassle that a customer might face.
As per the learnings from previous weeks, I have found that the procurement can allow in achieving the lowest purchase price from the point of view of a supplier. Procurement can allow in continuous supply of products therefore firms can minimize the risk of chaos and can significantly improve the overall process of operation. Further, procurement can allow in understanding the minimum amount of inventory investment required to support the continuity of the product. Procurement can also continuously focus on the quality improvement process and can allow the manufacturing process to reduce the poor quality outputs. I have also found that the procurement process can allow in achieving the long-term goals. The procurement strategy can be used to create more understanding the suitable relation, which can reduce workplace complexity and can allow in supplier involvement. I have also found a concept termed as Just in Time (JIT), which is used to understand at what time the purchase materials, and products are arriving at the market. This can allow in reducing the raw materials and work in progress inventories as well as can reduce reserve stocks of a company.
I have found that the transportation process is defined as the elements and interactions, which can allow in producing demand for product in s designated area and the supply of sufficient services that satisfies the demand for the product. I have found that the transportation is a broad term which can be applied to different contexts and topics. I think transportation plays a crucial role in the overall manufacturing and logistics system. The transportation procedure has one of the most significant expenses in the field of logistics and it costs of 60% of the total logistic spend of a firm. I have found that the transportation functionality usually involves the product movement, inventory technology control as well as understanding of the financial and environmental resources. The product movement process contains the movement of an inventory to a specific destination throughout the supply chain process. Within the transportation phase, the product is stored when the product is in a transportation vehicle. The process of transportation usually includes and are influenced by six parties; government, public, consignor (Shipper), carrier and agents, consignee (Receiver) and information technology. The shipper and consignee has interest in the movement of the product from the origin location to the designated location. The carrier is responsible for the pickup and delivery of products. The agents include the brokers and the freight forwarders who facilitate the carrier as well as customer matching. The government supports the efficient transportation system, which allows them to facilitate economic growth, and allows them to focus on the economic as well as social wellbeing. However, I have found that the policy formulation of the transportation system is usually complex as there can be various conflicts between the shippers, consignees as well as carriers.
Conclusion
As per the above, it is now clear that I have learned various materials and models related to supply chain, which will allow me in deeper understanding of the subject topic. I have found that every models are crucial are needed to be maintained in order to improve the process. Further, I have found that the work in process and the stock levels needs to be maintained in an organisation in order to improve the production and quality within the manufacturing process. I think the term s and models which I have addressed plays a crucial role in the supply chain without which an organisation cannot improve its existing process.
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