Problem Formation

 Kepner-Tregoe (KT) Situation Analysis – Issues (Source):

• Timing:

  • Competition is always on the rise and if you cannot stay ahead of the competitors, then you will lose customers to other companies and the business will fail. If inventory is hard to find in a warehouse, then it will lead to incomplete, inaccurate or delayed shipments.

• Trend:

  • Customer demand for products is constantly changing and inventory needs to change with it. Stores cannot have too much or too little of any products as it will waste space and money or ruin potential profits. Currently, manual inventory tracking procedures across different software and spreadsheets is time-consuming, redundant and vulnerable to errors.

• Impact:

  • Inventory needs to be known at any given moment. Inaccurate inventory data can lead to stores and warehouses not having the products needed for their customers. This creates a backlog on orders and can cause customers to be dissatisfied.

• Order of Tasks:

  • With all that is known, the tasks, in order, are to:

KT Problem Analysis – Problems & Causes:

• What?

  • Problems occur due to lack of inventory management because of inaccurate data and unknown product locations. Manual inventory tracking is constrained by human error and miscommunication. The goal is to give customers the items they want on time and poor inventory management can create delays for customers. It is unexpected to know what customers want ahead and how their demands change over time. This unpredictability can lead to items in the inventory from being oversold or undersold.

• When?

  • Problems can occur at any time, therefore, solutions should be taken as soon as possible. As technology advances, better product tracking implementations have been made to help keep better management of inventory.

• Who?

  • Better communication between employees can help with the management of the inventory. Better communication between customers and sellers can help with what to expect with customer demand and to prepare products ahead of time. Customers could be anyone, usually the general public, in search of the products sold at the stores and warehouses. Better organization of tasks given to employees can help with the efficiency of stores and warehouses as they can know what is done and what needs to be done. Problems in the stores and warehouses can affect the customers if they cannot get their products; this then affects the reputations of these companies.

• Where?

  • Problems usually occur onsite. Products are delivered by truckloads and need to be unpacked, counted, and stored properly in order to keep good management of the inventory. If the product locations in the store or warehouse are unknown, then finding items will take longer or will not be found at all, leaving the customer dissatisfied. Products are usually sold in stores, but they can also be shipped to customers’ addresses. 

• Why?

  • If a store’s product tracking is poor, then its overall efficiency will decrease and it will lose valuable customers and profits. Marking products with near-field communication (NFC) chips allows the products to be counted for and can be used to mark locations in store that helps with inventory management. The reason poor product tracking happens is because it is usually done manually and human error and miscommunication cause inefficiency in the store or warehouse. Therefore, inventory management is only as smart, reliable, and efficient as its employees.

• How?

  • In stores and warehouses, tasks can be done anywhere between really well and really poorly. Poorly done tasks can cause poor performance in inventory management and task efficiency. These problems develop when employees either choose to do tasks improperly or through human error in the management of the products.