The concept of lean manufacturing has been becoming more popular among businesses across numerous sectors. At its most basic level, lean manufacturing involves eliminating any processes that do not provide direct value to clients or customers. One of the ways members of the manufacturing industry can reduce expenses is by evaluating their inventory management processes in this way.
Instances over overstocking and inventory mismanagement can quickly escalate to a systematic problem if businesses are not diligent about putting in place tools to reduce the frequency with which they occur. The costs incurred from failing to monitor inventory movement can eat into a company's bottom line, as funds are being expended on unnecessary inventory purchases and replacements. A well executed warehouse inventory management system can provide onsite managers as well as leaders in other departments with the oversight to quickly identify wasteful practices and clip them from the enterprise's operating budget.
In an article appearing in Logistics Viewpoints, Manhattan Associates director Adam Kline suggested that these principles can even be applied to businesses that operate on a make-to-order concept by improving the acquisition and movement of raw materials needed to create finished products.
"A lean supply chain is not dependent on when in the order lifecycle the goods are made," Kline wrote. "By streamlining pre-production and post-production movements of raw materials and finished goods, you can reduce time from receipt of raw materials to shipment of finished goods, allowing many to achieve same-day build and ship."
The principles of lean manufacturing stress the removal of waste and the consolidation of resources. One way for companies to achieve that goal is to integrate their inventory management solutions with accounting systems. According to product marketing strategist and Manufacturing Business Technology contributor Jason Sentell, harmonizing these two functions will facilitate greater operational insight across the enterprise.
"Integrating [inventory management and accounting systems] enables leadership to effectively plan and predictably execute while minimizing labor costs and errors associated with manually reconciling inventory systems with accounting systems," Sentell stated.
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