GMS 401 Chapter Notes - Chapter 10: Mass Customization, Foodservice, Hypodermic Needle

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 401
• Professor: Wally Whistance- Smith

Document Summary

Inventory is one of the most expensive assets of many companies, representing as much as 50% of the total invested capital. Operations managers around the globe have long recognized that good inventory management is crucial. On the one hand, a firm can reduce costs by reducing inventory. On the other hand, production may stop and customers become dissatisfied when an item is out of stock. The objective of inventory management is to strike a balance between inventory investment and customer service. You can never achieve a low-cost strategy without good inventory management: all organizations have some type of inventory planning and control system. A bank has methods to control its inventory of cash. A hospital has methods to control blood supplies and pharmaceuticals. Government agencies, schools, and, of course, virtually every manufacturing and production organization are concerned with inventory planning and control. In cases of physical products, the organization must determine whether to produce goods or to purchase them.