Brief Insight on Benefits of Inventory Planning & Factory Planning Over Spreadsheets

Author : pollymcelroy
Publish Date : 2021-05-27

Brief Insight on Benefits of Inventory Planning & Factory Planning Over Spreadsheets

What are the disadvantages of using spreadsheet?

Spreadsheets have many disadvantages. Firstly, it cannot work or produce results when the products are mixed. Spreadsheets always assume a lead-time that is fixed which isn't the case in real-time. Apart from this, there are many restrictions like product attributes, tool availability and setting up of times. All these features are not available in spreadsheets. Spreadsheets also allow users to change and manipulate the data very easily.

This is not good with respect to the aspect of security of data. The answer to this is specialized planning software. Even though some investment might be required in purchasing the software, yet they remove most of the problems and discrepancies present in spreadsheet.

What is meant by inventory planning and why is it important?

According to a few researches, Inventory Planning & Inventory Management is very important. Increasing the inventory efficiency and optimizing it can help to increase the share values as well as the share-holders of the company. This is because levels of the customer service will increase very quickly and the levels of inventory will be lowered throughout the chain of supplies. This project has very little amount of risk as is very likely to give good returns. The implementation time of this project is also very little.

There is software that can be used to plan the inventories. Such software plans while keeping the budget in mind as well as the interest of the customers. It is quite different from the approach that is traditionally followed. It can also manage many supply chains at the same time and that too very easily.

Such systems require quite a few values as input. Some of them are the minimum and maximum levels of stock, the targets of the inventory and the quantity of the order. A huge number of combinations can be generated. The planner can be used to narrow down these combinations using a set of filter rules.
As I have stated elsewhere in other blogs and articles, I believe that research is a critical component of good business and decision-making. Indeed, a business plan is worthless without solid research to back up statements and commentary on markets and the industry in which you operate. Furthermore, it is difficult to imagine strategy formulation without an understanding of your industry. Here's a further thought: What industry are you in? I leave this question with you at this time!

We all bandy around the term 'industry analysis', but what is it, and what should a good industry analysis report contain?

Industry Analysis

Questions answered by an industry analysis include:

- What are the industry dominant economic traits?

- What competitive forces are at work in the industry and how strong are they?

- What are the forces of change in the industry and what impact will they have?

- Which companies are in the strongest/weakest competitive position?

- What key factors will determine success or failure?

- How attractive is the industry in terms of its prospects for above average profitability?

Industry Analysis Outline

Having identified the questions which should be answered by an industry analysis, the following list provides an outline of the report:

- Introduction

o Description

o Segments

o Caveats

- Socio-Economic

o Relevant governmental or environmental factors

o Economic indicators relevant for the industry

- Porter's Five Forces

o Threat of new entrants

- Economies of scale

- Working capital requirements

- Proprietary product differences

- Absolute cost advantages

- Brand identity

- Access to distribution

- Expected retaliation

o Suppliers

- Supplier concentration

- Presence of substitute inputs

- Differentiation of inputs

- Importance of volume to supplier

- Impact of inputs on cost or differentiation

- Threat of forward or backward integration

- Access to capital

- Access to labour

o Buyers

- Buyer concentration versus industry concentration

- Buyer switching costs

- Buyer information

- Threat of backward integration

- Pull through (use of intermediaries)

- Brand identity of buyers

- Price sensitivity

- Price to total purchases

o Substitute products

- Relative price/performance relationship of substitutes

- Buyer propensity to substitute

o Rivalry

- Degree of concentration and balance among competitors

- Diversity among competitors

- Industry growth rate (past and projected)

- Fixed costs/value added

- Intermittent overcapacity

- Product differentiation

- Growth of foreign competition

- Corporate stakes

- Exit barriers

- Conclusion

o Critical success factors

o Prognosis - the assessment of the future for this industry

- Bibliography

- Appendices

o Industry ratios

o Other relevant indices

o Other relevant data

Clearly, not all these sections are relevant for all industries, but it does give a broad outline of the likely contents.

In case you are concerned about how a business operates- its structure, strategy, operation and management, then a career in management consultancy will be the best option for you. The management consultants are really important for improving the growth and performance of the businesses by solving existing issues and finding better and new ways of doing things. It is not only meant for the private sector, but often these consultants' work with the public organizations to develop the services and make savings while reducing the costs.

Management consultancy firms are well-known for offering services across different areas of business - starting from marketing and HR to finance and IT. The broad area of consulting makes management consulting a lucrative career option, while offering the consultants different types of challenges, opportunities and projects for personal development. This might include working all around the globe with the multinational clients, even if they don't join any of the big organizations. The biggest consultancies mostly come with several thousand or at least hundreds of employees, but still a growing number of successful niche players between 10 and 100 consultants are there, who also bring some really interesting career opportunities.

Companies mainly hire the management consultants for a number of reasons like gaining access to the specialized experience of those consultants and for getting external advice. Because of the relationship and exposure of these consultants to several clients and companies, they are well aware of the industry best practices. But sometimes, the transferability of these practices may be problematic from organization to another on the basis of the situation under consideration. Demands of management consultancy also show meeting some targets on time. Mostly this job is client facing and therefore the consultants are always under pressure to deliver.

The best part of the job of a management consultant is probably the excitement around various new projects coming along, which offer the scope to learn something new every time. This in turn makes them well equipped for new projects. This is also the thing that the consultants like about their jobs.

Actually, there is no set career path available in this industry. Though most of the large management consultancies directly recruit graduates right from the university, but an aptitude for listening to and dealing with the clients, ability to analysis business, preparing strategic planning and team building attract the consulting employers along with flexibility, strong interpersonal skills and creativity of the candidates.

These days, a number of companies prefer candidates with MBA or MSC degrees, but there is no need of such degrees. Likewise, having degrees in business can also be beneficial, but in reality, this type of consultancy is not one degree specific industry.

In the world of management consulting there is immense scope for expanding one's skill set, personal development and enhancing the CV. The majority of the consultancies also offer great training opportunities along with the scope to build up other skills. As client work has become more global, the management consultancies are now operating on a global basis and as a result, there is a great opportunity for traveling.

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