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Evaluating Order Point Inventory Systems
Author(s) -
Pope James A.,
Ardalan Ali
Publication year - 1988
Publication title -
journal of purchasing and materials management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.75
H-Index - 92
eISSN - 1745-493X
pISSN - 0094-8594
DOI - 10.1111/j.1745-493x.1988.tb00455.x
Subject(s) - inventory theory , computer science , order (exchange) , cycle count , inventory management , point (geometry) , operations research , perpetual inventory , economic order quantity , inventory control , point of sale , concept inventory , reorder point , operations management , order processing , business , marketing , mathematics , supply chain , economics , geometry , finance , world wide web
The techniques for establishing an optimal order point inventory system are well known. Once the system is established, however, evaluating and maintaining the system may be difficult. Two factors that contribute to this difficulty are the compromises with inventory theory that may have been made in establishing the system, and the large number of items in the typical inventory system. This article describes a series of measures and techniques that may be used to track and evaluate the performance of an order point inventory system. Each of these techniques utilizes data that typically already are found in inventory system records. Using these techniques, the inventory manager is able to give a precise answer when top management asks, How is the inventory system functioning, and how do you know?