A Manager's Survey of Inventory and Production Control Systems

The commonly felt profit squeeze during the past few years has created a renaissance of corporate interest in tighter inventory control and production scheduling. Without getting into the technical design questions relating to modern replenishment systems, this article reviews for managers the important components of an inventory control project aimed at improving cost and service performance. The discussion specifies for such a project both the steps to be taken as well as the pitfalls to be avoided, and reflects a 1970's state-of-the-art.

In particular, the survey examines four kinds of applications, ranging from systems that operate on a day-to-day or week-to-week basis to systems that provide information on a much less frequent basis to support major strategic investment decisions. In all four applications, the systems require holding inventory; the article will not treat situations in which ordering or manufacturing occurs in response to specific customer orders.