It is commonly heard from the manager that they have about 10 years of supply of certain items. However the major concerns related to inventory management are the level of customers availing the service of the organization and cost associated with carrying and ordering inventories (Dooley, 2013). When the inter-link between the inventory management, capacity planning and scheduling is broken, it may result in overproduction, which may be a loss for the organization as the manufactured product may turn obsolete. It occurs when the organization allows every production operation to work as fast as it can, without concerning the balance between the working of other production operations.
The imbalance between the inventory management, capacity planning and scheduling seems to be the result of ineffective management of the material. It is important for the organization to balance the supply chain processes, as not developing effective link between them can lead to disastrous results for the firm. The imbalance between these supply chain operation results in several operational challenges for the organizations such as suppliers’ issue, delivery delay, shortages or excess of product, demand upside, etc.
These lists of challenges will only grow for the organization, if immediate action is not taken to for restoring the balance of the supply chain processes. It is observed that supply chain organizations are always facing some kind of intense budget constraints. In situations like these the organizations are seen flitting from one issue to the other. The managers do not have time to step back and analyze each step of the supply chain process, however they seems to be more concern with gaining control immediate control over the situation.
This is when the imbalance between inventory management, capacity planning and scheduling grows and become and alarming issue for the organization. The continuous problems faced by the managers as the result of imbalance in inventory management, capacity planning and scheduling reduce the morale of the production managers as they start doubting their capabilities. This psychological effect resulting from the imbalance of the supply chain process may not be evident in short term but their long term effects cannot be ignored at any cost. Inefficiency in the supply chain process may provoke the higher management to question the credibility of the manager.
Many of them may have to lose their job as the result of the continuous loss faced by the firm.
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