O Reilly's Supply Chain

In any business, it is vital to have effective inventory management. This case, explored the challenges that these companies faced, during the difficult dot.com period. Thus, we discovered that the basic components of an effective supply chain model (pull approach), must include gathering input from finance, sales, IT, marketing, and key customers. Further, for the best optimization of this model, it is necessary that IT be involved to integrate the key elements. Thus, by utilizing this model, information can be shared throughout the supply line. In addition, this model will deliver a more accurate accounting of how much inventory is needed, increased customer support, and provide a competitive advantage. Consequently, the components of this …show more content…
Further, when integrated with the supply chain, it can boost a company’s competitive edge. Thus, inventory replenishment when integrated with the supply chain provided O’Reilly’s with an overview based on the forecasted demand of a part. Therefore, it effectively established a system that, reduced inventory, freed up capital, and fulfilled customer demands in a timely manner. Inventory replenishment, should not be utilized as the only system when managing inventory. Consequently, it is only one part of inventory management, that is why O’Reilly’s included its supply chain when adopting this system. (O 'Brien, & Marakas, 2011). Obviously, replenishment software can aid a business seeking to foresee its inventory needs. Further, there are multiple methods of replenishing inventory when utilizing this system. For example, my company utilizes reorder points which means that when an item drops below a certain point, another item is automatically reordered. In addition, this method also takes delivery lead-times into consideration. On the other hand, with our system there is always room for human error. For instance, when I worked in MRO, we were required to retrieve the requested item and write down the MRO identification number on an inventory pull pad. However, there were plenty of times when someone would leave their inventory pad on a shelf somewhere and just grab a new one. In this instance, a reorder point is not effective, especially if the item was never discharged from inventory. In addition, we also faced issues of a defective items when utilizing the reorder method. Nevertheless, when utilized correctly, replenishment has the capability of being an effective inventory management strategy. Especially, when the demand for an item varies over time. The value of information is an important factor in replenishment inventory management. For example, it is important for a