Inventory management relies on fundamentals like cycle counting to catch discrepancies.
Inventory management relies on fundamentals like cycle counting to catch discrepancies. But it has to be coupled with a focus on process disciplines or you’ll end up reliving the same problems every day.
I’ve started working with one of my clients on a cycle count program, and so I’m reminded of the critical importance of this supply chain fundamental. If you cannot find the right inventory in the right place at the right time, your customer will be negatively affected. This should be a sufficient reason to pay attention if you’d like to grow – or even maintain your customer base; however, it will also impact your profitability and cash flow if you need additional incentive.
Cycle counting is a measurement process; however, cycle counting alone will do NOTHING to fix your inventory accuracy issues. Count and adjust; count and adjust. If there is no root cause analysis, it becomes a vicious cycle with zero accomplished. Instead, you must focus on process disciplines. Does your company value process disciplines? Do NOT think about what is said. Instead, answer this question: If the employee responsible for work order transactions is near the end of the day and a machine breaks down, will you divert him/her from transactions (even if there is no backup) to help fix the machine? How about if you are being questioned by Finance about overtime and your resource already has worked “too much” overtime? Will you send him/her home and tell them to complete another task and finish the transactions tomorrow? What message does that send?