Advertisement Larry Korak Picture this: a shop floor manager sits, hunched over the desk. It’s late, long past the shift change but he’s not going anywhere. Tomorrow’s machine schedule isn’t done yet and the morning crew will need to know which job to start next, which orders are top priority,  this  week. The manager rubs his eyes, the lines on the spreadsheet are blurring. He grumbles to himself, “if only I had a crystal ball…” It’s easy to picture the scene and empathize with the manager who has been forced to make decisions, with few tools or relevant, contextual facts to help him. He may feel like he’s being asked to conjure data out of thin air, magically seeing into the future to predict when inventory will be consumed, how and why. These are monumental questions with no easy answers. Yet, that is often what is expected of operations directors, shop floor supervisors and line of business managers. Operational managers are tasked with keeping tight control on inventory in order to control costs. At the same time, however, they are also responsible for meeting customer expectations for on time delivery. A ready supply of raw materials and consumables must be on hand, or close at hand. Stock-outs and shortfalls can be disastrous, especially with mission critical parts or in industries with perishable goods.  Why managing inventory counts Margins are tight in manufacturing today and there is constant pressure to reduce working capital. Controlling inventory is, as a result, a critical part of managing resources, controlling waste and keeping cash flowing. No CFO wants to hear that funds are tied up in costly, low turn spare parts that sit in inventory for months on end as the risk of obsolescence grows. As “just-in-time” inventory has become the mantra of lean practitioners, […]