Operations Management Assignment Example | Topics and Well Written Essays - 1250 words

Operations Management - Assignment Example A business that has an effective management strategy is likely to have an upper hand in the market. There are diverse benefits associated with efficient operations management, including a reduction in the operational costs while enhancing customer satisfaction. Inventory management ensures that sales, customer service, and production are done effectively without interruptions, hence ensuring customer satisfaction and cost reduction. In addition, optimizations of inventory levels as well as helping in improving cash flows are major benefits derived from inventory management. Improper inventory management can lead a business to huge losses. In the modern context, several inventory management controls have been developed; some that are highly sophisticated while others are quite simplistic. Some of the available inventory management tools include ABC analysis, Economic Order Quantity (EOQ), Discounted EOQ, Vendor managed Inventory (VMI), LP, MRPII, TQM, ERP, KANBAN, and collaborative pl anning among others. Inventory management tools are very well applied in organizations for diverse purposes. A number of company operations are associated with the inventory management tools. Firstly, in the process of developing the company accounts, the accuracy is tremendously improved hence enhanced reporting of the company profits and losses (Silver 2008, p.16; Hilton1994). This is done based on the asset value that is attached to every item that is purchased, those within the company and the ones sold. Secondly, the management is able to identify flaws and ensure they are rectified before they get out of hand. The inventory management tools help track all the items in the company, thereby ensuring that flaws do not accrue until the stock taking date. Fourthly, customers are very important people as far as the company is concerned. The inventory management tools are able to identify items that are in shortage hence customers are able to make their bookings without being