INVENTORY MANAGEMENT

I Inventory Management
1 Introduction

defination AND MEANING

The inventory is a list of goods and materials or products and materials themselves, the stock held by a company. Inventory held to manage and hide the customer that the delay to alleviate the supply manufacture / longer than delivery delay, but also about the impact of errors in production, that the profits are lower in the production when the production capacity by the lack of materials hindered.

The reasons

has all of these reasons can apply to any warehouse owner or stage of a product.

buffer stock must be held in individual workstations against the possibility that the upstream workstation can provide a bit slow on the next item for processing. While some processes to make very large buffer stocks, Toyota moved to one (or several articles) and moved to eliminate this type of bearing.

safety stock is in a process or machine failure in the hope / faith, that defects will be corrected before proceeding with the stock lasts. These types of devices can be through programs such as Total Productive Maintenance

About Production is to be eliminated because the forecast and actual sales do not match. Make to order and JIT eliminates this type of measure.

Lot delay stock is required because part of the process for the entire game is only for individual treatment items operate. Therefore, each element of the set to wait until the whole batch before they are processed by the next post. This can be eliminated by one or a batch size of one.

demand fluctuations of the stock occurs when production capacity is not to decline the request. Therefore act in an era of reduced use is delivered to customers when demand exceeds production capacity built. This can be eliminated reduced by increasing the flexibility and the ability of a production line or by bank transfer to the load balancing item level.
balance online image agency, because the various sub-processes continue in a linear structure with different speeds. Therefore, accumulate after a fast sub-process or before a size of sub-processes of the large crowd. Line Balancing eliminates this type of bearing.

passage bearing , which for a sub-process, a system for a long time or change over time. This stock is then used, while the change is happening more. This stock can be removed by tools such as SMED.

If these stocks contain elements identical or similar, it is often the work of the practice, all these stocks are mixed together before or after the sub-processes to which they keep referring to. This “reduced” costs. Because they are confused, there is no visual reminder to operators in the vicinity of the sub-process or the online management of inventory, which is a particular cause and should be the responsibility of an individual with inevitable consequences. Some plants have centralized activities in the sub-processes, which makes the situation even more acute instead.

method of inventory accounting

inventory must be taken into account if cross-border settlement as an expense is usually required, must be compared with the results of such costs over the same period. If processes are simple and short, and the stocks were little, but with more complex processes, then the stocks have larger and more important elements in a balance sheet value. This need of the value of goods sold incomplete and has led many new behaviors in the practice of management. Perhaps the most fundamental is the complexity of the recovery of fixed costs, are transfer pricing, and the separation of direct and indirect costs. This would exclude “anticipates income” or “the declaration of dividends on capital.” It is one of the intangible benefits of Lean and the GST process times and reduced inventories to fall to the point where the importance of these activities is extremely limited and therefore strives to achieve, including the administration, can be minimized.

V LIFO / FIFO S

When a dealer sells goods from inventory, (sold CC) inventory value by the cost of goods sold reduced. It is simply where the CC has not held between the stock is changing, but he was then a common approach must be inferred. For commodity items that we can not track individually, accountants must choose an appropriate method to determine the type of sale. Two popular methods exist: FIFO and LIFO accounting (first in – first out, last in – first out). FIFO respect to the first unit that arrived in the preparation of the first sale. LIFO considers the last unit arrive in inventory as the first sale. What accounting method chosen will have a significant impact on net income and book value and, in turn, on taxation. The LIFO inventory accounting, a company usually lower net income and book value is reflected in lower inflation. This generally results in lower taxation. Because of the LIFO inventory accounting the potential to distort the inventory value, UK GAAP and IAS have effectively banned LIFO.

Supply Chain Management

A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials transforms these materials into products for intermediate and finished products and distribution of these finished products the customers. Supply chains exist in both service organizations and manufacturing, although the complexity of the chain vary considerably from sector to sector, industry and economy.

managing the supply chain is generally considered between fully vertically integrated companies, where the flow of material entirely from a company is owned and are those where each channel member operates independently. Thus, the coordination between the various actors in the chain, the key to effective management. Cooper and Ellram [1993] compares the management of the supply chain of a very balanced and well-established season. Such a team is more competitive if every player knows how to position the hand-off. The relationships are strongest between players who make the right stick (stick), but the whole team must be coordinated in an effort to win the race.

Below is an example of a simple supply chain for a single product, where raw materials are purchased from suppliers, transformed into finished products in one step, then transported to distribution centers and ultimately customers. Realistic supply chains across multiple end products with shared components, equipment and skills. The material flow is not always along an arborescent network, various modes are considered, and the bill for finished products, both wide and deep.

To simplify the concept, managing the supply chain can be defined as a loop: it starts with the customer and ends with the customer. All materials, products, information and even every transaction flows through the loop. However, the supply chain will be a very difficult task, because in reality the supply chain of a complex and dynamic systems and different organizations, trade-offs.

supply chains exist in both service and manufacturing companies, although the complexity of the chain vary considerably from sector to sector, industry and economy.

In contrast to the manufacture of commercial supplies, services such as planning clinical supplies are very dynamic and can often last minute changes. Kit available patient when the patient arrives at the investigator site, is very important to the success of clinical trials. This leads to an overproduction of medicines to take care of last minute changes to the application to take. Manufacturing R & D is very expensive and over-production of patient kits created significant cost to the overall cost of clinical studies. An integrated supply chain reduces the overproduction of drugs through effective demand management, planning and inventory management.

Traditionally, marketing, sales, planning, production and purchasing organizations along the supply chain operated independently of each other. These organizations have their own objectives and these are often contradictory. Marketing goal of customer service high and maximum turnover U.S. dollars conflict with the objectives of production and distribution. Many production plants are designed to maximize throughput and lower costs with little regard for the impact on resources and distribution. Sales contracts are often negotiated with very little information on historical buying patterns. The result of these factors is that there is no single, integrated plan for the organization — there were as many plans as businesses. Obviously there is a need for a mechanism that can be integrated through which these different functions. Supply chain management is a strategy by which such integration can be achieved.

Supply Chain Management (SCM) is the process of planning, execution and control of the supply chain in order to satisfy customer needs efficiently as possible. Chain management spans all movement and storage of materials, work in process and finished goods from point of origin to point of consumption.

According to the Council of Supply Chain Management Professionals (CSCMP)

A professional body has a definition in 2004, supply chain management “includes the planning and control of all activities of purchasing and procurement, conversion and all the activities of the management of logistics. ” It is important that it can also be coordination and collaboration with channel partners, suppliers, intermediaries, third party service providers and customers. In essence, integrated supply chain management of supply and demand within and between companies.

According to Cohen & Lee (1988)
br Supply Chain Management is “The network of organizations that have relationships, both upstream and Downstream in the various processes and activities, and produces delivers value through products and services into the hands of consumers. “Thus, a T-shirt manufacturer of the supply chain s extends upstream through the armor of tissues for spinners and fiber manufacturers and downstream through the distribution and retail to the consumer. Although each of these organizations are dependent on each other has not traditionally cooperate closely with each other. Integrated supply chain management, simplifies the process and increases profitability by the right product at the right place at the right time and at minimal cost.

After Ganeshan & Harrison (2001)

Supply Chain Management is a system “approach to managing the flow of information, materials and services from suppliers of raw materials by factories and warehouses to the retail customer. “

Supply Chain Event Management (SCEM for short) is an examination of all events can occur and the factors that could cause a disruption in the supply chain. With SCEM possible scenarios can be created and solutions can be considered.

Some experts distinguish supply chain management, purchasing and logistics management, while others consider that the terms are interchangeable. From the perspective of a company, the scope of supply chain management is usually on the supply side by the suppliers of your suppliers and customers side is limited by the customers of your customers.

managing the supply chain is also a category of software products.

2 SIEMENS

Siemens is one of the largest companies in the world and decided largest engineering in Europe. Siemens has six business segments: Information and Communications, Automation and Control, Power, Transportation, Medical and Lighting. international headquarters of Siemens in Berlin and Munich, Germany. Siemens AG is listed on the Frankfurt Stock Exchange and has been since the 12th NYSE March 2001 listed. Worldwide, Siemens and its subsidiaries employ 480,000 people in 190 countries and reported worldwide sales of € 87,325,000,000 in fiscal year 2006

Siemens was founded by Werner von Siemens to 1 was invented in October 1847 on the basis of Telegraph he, with a needle on the order of the letters point instead of Morse code. . The company – then Telegraph Construction of Siemens & Halske – opened its first workshop on 12 October

In 1848, the company has built the first telegraph line in Europe on long distance, 500 km from Berlin, Frankfurt am Main. In 1850, the younger brother of the founder Sir William Siemens began (born Carl Wilhelm Siemens), the companies represented in London. In the 1850s, the company has invested in building long distance telegraph networks in Russia. In 1855 a branch of a company, opened by another brother, Carl von Siemens, opened in St. Petersburg. In 1867, Siemens completed the monumental Indo-European (Calcutta to London) telegraph line.

In 1881, a Siemens AC generator was powered by a water mill, used to power the world’s first electric street lighting in the town of Godalming, United Kingdom. The company continues to grow and diversify, electric trains and light bulbs. In 1890 the founders moved and left the business to his brother and son Carl Arnold and Wilhelm. Siemens & Halske (S & H) was added in 1897.

In 1919, S H and two other companies have the Osram bulb & produced. A Japanese subsidiary was established in 1923.

In the 1920 and 1930, started S & H to radios, televisions, and electron microscopes produce.

Before the Second World War, Siemens participated in the secret rearmament of Germany. During the Second World War, like most large companies in Germany at the time, Siemens is supporting the Hitler regime, contributed to the war effort and participated in the “denazification” of the economy. Siemens had used many factories in and around the death camps like Auschwitz and the famous slave labor camps to build electric switches for military purposes. In one example, almost 100,000 men and women from Auschwitz worked in a Siemens factory in the camp of annihilation, the supply of electricity in the camp.

In the 1950s and started their new base in Bavaria, S & H, make computers, semiconductor devices, washing machines and heart pacemakers. Siemens AG was incorporated in 1966. The first company phone number was produced 1980th In 1988 Siemens and GEC acquired the UK defense and technology company Plessey. Farms were divided Plessey, and Siemens took over the avionics, radar and business traffic control -. Siemens Plessey

In 1999, the semiconductor operations of Siemens into a new company have been converted as Infineon Technologies announced. In addition, Siemens Nixdorf Informationssysteme AG is part of the Fujitsu Siemens AG this year. The group’s retail banking technology, Wincor Nixdorf.

In February 2003, Siemens opened an office in Kabul [3].
In 2004, Siemens has the mantle of official Formula One timekeeper removed and replaced TAG Heuer.

In November 2005, Siemens signed an agreement 12 years with the Walt Disney Company to attractions in Florida and California, to sponsor its parks.

In 2006, the Company continued its acquisition of Bayer Diagnostics in the Medical Solutions Diagnostics division officially on 1 January 2007 was accepted.

In March 2007 a Siemens board temporarily arrested and accused of illegally financing a combination of cheap labor to the firm which is against the trade union IG Metall in the competition. He was released on bail. Offices of the Union of Labour and was searched by Siemens. Siemens denies any wrongdoing.

In April 2007, fixed networks, mobile networks and Carrier Services divisions of Siemens with the Nokia business network in a 50/50 joint venture together, creating a network company called Nokia Siemens Networks and Mobile Communications. Nokia delayed the merger because of the corruption investigations against Siemens.

major customer of Siemens

KCR

-Novartis-Edmonton-Calgary Transit System Transit

-German Bahn AG (German Railways)
-Metro Rail (Houston, Texas)
-Sacramento Regional Transit District
TheRide Regional Transportation District (Denver, Colorado)
LACMTA (Los Angeles County, California )
-Pittsburgh />
-MAX Light Rail (Portland, Oregon)
-Netherlands Railways (paths Dutch Railways) (Netherlands Harbour Rotterdam (Rotterdam, Netherlands)
Balkim-Muh. Elk. Sti.

-BBC-Indian Railways

-Airtel-Power Grid Corporation of India

Products

Industrial Instrumentation (Sensors and Controls )
-Telecommunications Service Platform ™, which TSP-7000
Combino, ULF, and Avanto trams
Siemens Düwag U2 LRV
-ER20 locomotive – MTR
-LHB / Siemens M1/M2/M3 Metro Pair March
-Siemens-Adtranz LRV -Duewag/Siemens
1435 Combino low floor />

Metro-S4000 -Schindler/Siemens Fig. 4 / 8 low-floor light rail

5001-NGT 6D LRV Metro SWBSiemensr
– € Sprinter locomotive
-Desiro, ICE and Transrapid
Gigaset products for home entertainment, including Gigaset M740 AV, a decoder to receive TDT and integrate it into a home network (via wireless or cable) or home-media streaming.
-Hicom Trading E-Hicom 300

-HiQ 8000 Softswitch HiPath

exchange EWSD SPX 2000 small digital exchange (rural)
Siemens Gigaset cordless phones
-Siemens mobile phones – sold to BenQ in 2005
-Siemens SPPA-T2000 Control System (formerly Teleperm XP)
-Siemens SPPA- T3000 Control System (for power generation control)
process control system SIMATIC PCS 7 automation system for process and hybrid industries
radio and raw materials for 2G and 3G Mobile (GSM, UMTS, …)
-gas and steam turbine

-programmable controls (including Simatic PLC, microcontrollers and the logo!) – Siemens Servo life support ventilator line
-MAGNETOM (TM) Espree
SOMATOM (R) Definition
CT SOMATOM (R) CT Somatom Sensation
– (R) CT
emotion-AXIOM Artis
-AXIOM Sensis
-e . cam Signature Series Gamma Camera
SPECT-CT Symbia TruePoint
biographer TRuepoint PET.CT
-Magnetom C!, a low field open MRI
Magnetom Avanto, a Tim system MRI Magnetom Espree
-A Tim system, open bore MRI Magnetom
Trio, a Tim system, Ultra-High MRI
wind, 1.3 MW, 2.3 MW and 3 , 6 MW
-Sinorix (TM)
-Sistore (TM)

Siemens’ main competitors are:

-ABB, Alcatel-Lucent

-Alstom-Bombardier Automated Logic

Cisco Systems Computrol
-Eaton />
-Ericsson-GE-Honeywell
Johnson Controls

-Lantronix Nortel

-Philips-Reliable Controls

-Samsung /> – Schneider Electric

third OBJECTIVES AND NEED Supply Chain Management

Traditionally, marketing, sales, planning, production and purchasing organizations independent of each other along the supply chain operated. These organizations have their own objectives and these are often contradictory.

marketing goal of customer service high and a maximum of U.S. dollars in sales conflict with the objectives of production and distribution. Many production plants are designed to maximize throughput and lower costs with little regard for the impact on resources and distribution. Sales contracts are often negotiated with very little information on historical buying patterns.

The result of these factors that there is no single, integrated plan for the organization — there were as many plans as businesses. Obviously there is a need for a mechanism that can be integrated through which these different functions. Supply chain management is a strategy by which such integration can be achieved.

In addition, shorter product life cycles, increased competition and higher customer expectations have forced many leading companies, from physical logistic management towards a more advanced move logistics chain. Moreover, in recent years has become clear that many companies have reduced their production as much as is practically possible. Therefore, in many cases the only way to further reduce costs and delays in the implementation of effective supply chain.

to reduce costs in order to facilitate the concept of supply chain management and improved customer service. Enables management of

– Inventories,
– transport systems and
– all distribution

so that organizations are able to meet or exceed the expectations of its customers.

The main objective of managing the supply chain to reduce or eliminate the inventory buffer between the mountains of the chain through the exchange of information on stocks and the current demand.

In general, an organization needs a system of effective and appropriate supply chain management so that the areas of strategic and competitive can be used to their advantage if a system is managing the supply chain are carried out properly.

1 Satisfaction of raw materials:

ensure the right quantity of parts for production or products for sale come at the right time. This is possible through effective communication will be placed so that filled orders with the appropriate amount of time available to be. The management system of the supply chain enables a company constantly see what in the warehouse and ensure that correct quantities are ordered to replace the stocks.

2 Logistics:

The cost of transporting materials as small as possible consistent with safe and reliable delivery. This allows the management system of the supply chain of a company at a constant contact with its sales force, which may consist of trucks, trains, or any other form of transportation. The system can allow the company where the equipment required to pursue any time. In addition, it may be profitable to transportation costs, shared with a partner, if it is not large enough to fill an entire truck and this time the company can make the decision.

3 Smooth production:

production lines ensure smooth operation, as the high quality available, if parts are needed. The production could be carried out after the execution of logistics and proper implementation. If the quantity is not ordered and delivered correctly at the required time, the production will be stopped, but the system efficient supply chain management in place will ensure that the production always run smoothly, without delays due to the control and transport.

4 Revenue and profit:

ensure no revenue lost because shelves are empty. Managing the supply chain to improve business agility to respond to unexpected changes in supply and demand. Thus, a company the ability to produce goods at lower prices and distribute them to consumers more quickly than companies without increased supply chain management so that the overall profit.

5 Reduced costs:

keep the cost of purchased components and products to an acceptable level. Managing the supply chain reduces costs by increasing inventory turnover in the workshop and warehouse quality control of products by reducing the costs of internal and external faults together with suppliers to produce the cheapest way to manufacture a product.

6 Shared success:

to ensure the supply chain partners, joint success. Collaborative Planning, Forecasting and Replenishment (CPFR) is a long-term joint work on quality and support by the buyer to supplier management, technological development capabilities. This relationship allows a company access to current and reliable information to have to maintain lower inventories, reduce waiting times, improve product quality, improve forecast accuracy and ultimately improve customer service and overall profits.
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Inventory Management