Analyzing Inventory Management's Role in Supply Chain Operations

This report examines the pivotal role of inventory management within the context of strategic purchasing and logistics in the supply chain. It highlights the importance of inventory management in balancing supply and demand, optimizing business operations, and fostering strong customer relations...Read More

Running Head: Strategic Purchasing and Logistics
strategic purchasing and logistics
[Document subtitle]

Strategic Purchasing and Logistics 1
Inventory management is important in the supply chain to decide an organization ability to
operate with good profit margins. In addition, inventory management is necessary for supply
chain to establish coordination and achieve optimization in business operations. This will help
the organizations in optimizing the linkage between inventory and supply chain to enhance
differentiation and reduce costs. In addition, inventory management proves helpful in managing
customer and establishing a strong relationship in managing supply chain (Christopher, 2016).
Perhaps the most important role that inventory management play in the supply chain is
facilitating the balancing of demand and supply. This helps the different organization in
managing the reverse and forward flows in the supply chain. On the other hand, inventory
management in supply chain helps the organization to deal with downstream customer demands
and upstream supplier exchanges. Thus, it can be said that inventory management has significant
importance in the supply chain.
After reading the existing bibliography of page 6 in the reading, it can be said that manufacturing
resource planning and Just-In-Time Production are current trends in the inventory management.
Manufacturing resource planning improves the functionality of organizations by planning their
manufacturer's resources (Biederman, 2004). This has been done by passing a large number of
processes like operations and sales planning, business planning, and capacity requirements
planning. On the other hand, Just-In-Time production also plays an important role in improving
the functionality of organizations. Just-In-Time production performs this by eliminating waste
from overproduction, processing, inventory, and waiting time (Monczka, 2015). Just-In-Time
Production smooths the inventory functions by avoiding business problems and offer machines
with the autonomous capability to use.

Strategic Purchasing and Logistics 2
References
Biederman, D. (2004). Reversing Inventory Management. Traffic World.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and supply
chain management. Cengage Learning.