PSC 495 Internal and External Research

Executive Summary

This report focuses on the identified problems in the inventory system of the organization and to develop the potential solutions for it. The company is facing a delivery issue from the suppliers’ end due to which raw material is not available at times in the company. This affects the production of the company. This paper shows the research findings revealing the fact that the cause behind the company’s problems in business is the inventory issues held due to the improper communication with the raw material suppliers. This report contains three charts to show the internal and external research.  The first chart shows the recorded information of the company’s data focusing on the problem and failure to address the problem. The second chart shows the research findings of the previous efforts taken to solve this problem. This data has been collected by the personal experiences of the individuals. The third chart determines the potential solutions to this situation and how various other companies were able to successfully resolve this problem. Finally, the report concludes by recommendations of five potential solutions. Along with this report there is also an excel spreadsheet to summarize the collected research data about the organization.

Effect of the Problem on the Organization’s Performance

The organization is facing an issue of delivery of raw materials from the supplier and most of the time there is a late delivery of raw materials which leads to inventory issues. The growth of organization is stagnant and since past five years there has been no effective growth in the company’s business. Several times there are issues of spare parts, raw materials and sometimes even required tools are unavailable. This unavailability of the inventory at the time of production leads to operational loss and affects the orders of the customers (Cachon& Fisher, 2000). Thus, the company is not able to create a name in the market yet for its products and services. The following chart represents the effect of the lack of inventory on the production of the company in the past five years.

The above chart shows the stagnant production of the company due to the unavailability of the spare parts, store units, raw materials, etc. The production units of the company over the past five years have remained almost stagnant and there has been no significant growth. This is a great issue and need to be resolved for the progress of the company.

Previous Solutions to address the Problem

The above graph shows the survey conducted on the 50 individuals of the company who took part in previous solutions to the problem.

Five Potential Solutions

The above graph shows the five potential solutions carried out by other companies to solve the problem of missed delivery timelines from the suppliers. The graph shows the percentage of success of each of the solutions that has been undertaken (CSCO insights, 2011) (Benavides, De Eskinazis& Swan, 2012).

Conclusion

The organization has been undergoing the serious issue of stagnation in its growth due to loss in proper communication with the suppliers and thus in lack proper inventory management. The organization has already undertaken several measures to resolve this issue; however, those were not successful to bring effective change in the progress of the company. Thus the company needs to consider a proactive approach to resolve this issue and build an effective strong communication with the suppliers (Prahinski& Benton, 2004). The company needs to have proper vendor management, and a strong internal process for which it is also essential that the company performs regular risk assessment. This will successfully resolve the issue of inventory management in the organization and will hence promote the rapid growth of the organization (Simpson, Siguaw& White, 2002).

References

Benavides, L., De Eskinazis, V., & Swan, D. (2012). Six steps to successful supply chain collaboration. Washington: CSCMP’s Supply Chain Quarterly. Retrieved February 10, 2016 from http://www.supplychainquarterly.com/topics/Strategy/20120622-six-steps-to-successful-supply-chain-collaboration/

Cachon, G. P., & Fisher, M. (2000). Supply chain inventory management and the value of shared information. Management science, 46(8), 1032-1048.

CSCO insights, (June 2011). Five Strategies for Improving Inventory Management Across Complex Supply Chain Networks. Chief Supply Chain Officer Insights. Retrieved February 10, 2016 fromhttp://www.scdigest.com/assets/reps/exec_brief_network_inventories.pdf

Prahinski, C., & Benton, W. C. (2004). Supplier evaluations: communication strategies to improve supplier performance. Journal of operations management, 22(1), 39-62.

Simpson, P. M., Siguaw, J. A., & White, S. C. (2002).Measuring the performance of suppliers: an analysis of evaluation processes. Journal of Supply Chain Management, 38(4), 29-41.