2.1. What are the main causes of inventory stock-outs at warehouses?
According to Tourtoulo, Laurent, & Mace (2006, p. 20), human errors are the main cause of stock-outs incidents, due to workforces’ intervention in daily warehouse tasks, including forecasting and order picking. Therefore, the possibilities of stock-outs occurrence increases when inaccurate data is manually collected. In conformity, a study conducted by Kang & Gershwin (2004, p. 19) reached the same conclusion, as its findings recognized human errors a chief contributor to stock-outs and shrinkage events, through user involvement in product identification and manual counts.
Moreover, Kang & Gershwin (2004, p. 4) justified, false labelling can lead to stocks being stored in wrong aisles, which will consume time and create diffculty in finding them later. If the lost-stocks were not soon found, they will be considered stock-outs. Another possible reason can be ineffective delivery planning carried out by suppliers’ employees, as this can result in lacking inventory at the customer’s warehouse when needed (Tourtoulo, Laurent, & Mace, 2006, p. 21).
Consequently, the two articles by Tourtoulo, Laurent, & Mace (2006) and Kang & Gershwin (2004), found human errors the root of stock-outs incidents at warehouses. However, different methodologies were obtained to reach those findings. Primary data of Tourtoulo, Laurent, & Mace (2006) were collected through two key approaches, namely, work-placement observation and interviews. While the credibility of Kang & Gershwin’s (2004) findings are considered weak, due to their dependency on observation only. Based on the previous analysis, a hypothesis suggesting human errors as a main cause to the stock-outs incident in ABC’s warehouse can be reached. Hence, ABC Industries areable to point out manual data collection tasks that led to this phenomenon; such as poor forecasting, manual count and inaccurate labelling. 1.1. How the implementation of MRP systems along with the barcoding technology, can minimize stock-outs and enhance inventory management at warehouses? First, a case study by Wei, Idrus, & Abdullah (2017, p. 1) examined a manufacturer’s warehouse, which experienced constant delays in delivering manufacturing products. The findings highlighted the use of inefficient inventory management techniques by the warehouse’s employees, such as, observation and physical count (Wei, Idrus, & Abdullah, 2017, p. 4). Accordingly, Wei, Idrus, & Abdullah (2017, p. 4) identified poor forecasting and manual data inputs at the warehouse’s ERP, as the cause of wrong estimations of stock-outs. Moreover, it was advised by Wei, Idrus, & Abdullah (2017, p. 4) to equip the production’s warehouse with an integrated MRP system to enhance the inventory management; as then, an automated system will replace the need of workforces. In a similar manner, Mpwanya (2005, p. 33) stated, integrating the warehouse’s MRP system with the company’s ERP system, allows an effective computerized forecasting and improves inventory management. However, a case study by Mandala & Gunasekaran (2002, pp. …show more content…
3) relied on site observation to obtain primary data, with the support of secondary data from interview and questionnaires, which aided in forming a hypothesis. Likewise, Mpwanya (2005), had also utilized primary quantitative data from questionnaires, face-to-face interviews and phone interviews to introduce a theory; nevertheless, phone interviews were time consuming and improper, due to the long list of the questions to be asked. On the contrary, Mandala & Gunasekaran (2002) did not justify the primary techniques used to support their statements in their case study; as it is was dependent on secondary resources
According to Tourtoulo, Laurent, & Mace (2006, p. 20), human errors are the main cause of stock-outs incidents, due to workforces’ intervention in daily warehouse tasks, including forecasting and order picking. Therefore, the possibilities of stock-outs occurrence increases when inaccurate data is manually collected. In conformity, a study conducted by Kang & Gershwin (2004, p. 19) reached the same conclusion, as its findings recognized human errors a chief contributor to stock-outs and shrinkage events, through user involvement in product identification and manual counts.
Moreover, Kang & Gershwin (2004, p. 4) justified, false labelling can lead to stocks being stored in wrong aisles, which will consume time and create diffculty in finding them later. If the lost-stocks were not soon found, they will be considered stock-outs. Another possible reason can be ineffective delivery planning carried out by suppliers’ employees, as this can result in lacking inventory at the customer’s warehouse when needed (Tourtoulo, Laurent, & Mace, 2006, p. 21).
Consequently, the two articles by Tourtoulo, Laurent, & Mace (2006) and Kang & Gershwin (2004), found human errors the root of stock-outs incidents at warehouses. However, different methodologies were obtained to reach those findings. Primary data of Tourtoulo, Laurent, & Mace (2006) were collected through two key approaches, namely, work-placement observation and interviews. While the credibility of Kang & Gershwin’s (2004) findings are considered weak, due to their dependency on observation only. Based on the previous analysis, a hypothesis suggesting human errors as a main cause to the stock-outs incident in ABC’s warehouse can be reached. Hence, ABC Industries areable to point out manual data collection tasks that led to this phenomenon; such as poor forecasting, manual count and inaccurate labelling. 1.1. How the implementation of MRP systems along with the barcoding technology, can minimize stock-outs and enhance inventory management at warehouses? First, a case study by Wei, Idrus, & Abdullah (2017, p. 1) examined a manufacturer’s warehouse, which experienced constant delays in delivering manufacturing products. The findings highlighted the use of inefficient inventory management techniques by the warehouse’s employees, such as, observation and physical count (Wei, Idrus, & Abdullah, 2017, p. 4). Accordingly, Wei, Idrus, & Abdullah (2017, p. 4) identified poor forecasting and manual data inputs at the warehouse’s ERP, as the cause of wrong estimations of stock-outs. Moreover, it was advised by Wei, Idrus, & Abdullah (2017, p. 4) to equip the production’s warehouse with an integrated MRP system to enhance the inventory management; as then, an automated system will replace the need of workforces. In a similar manner, Mpwanya (2005, p. 33) stated, integrating the warehouse’s MRP system with the company’s ERP system, allows an effective computerized forecasting and improves inventory management. However, a case study by Mandala & Gunasekaran (2002, pp. …show more content…
3) relied on site observation to obtain primary data, with the support of secondary data from interview and questionnaires, which aided in forming a hypothesis. Likewise, Mpwanya (2005), had also utilized primary quantitative data from questionnaires, face-to-face interviews and phone interviews to introduce a theory; nevertheless, phone interviews were time consuming and improper, due to the long list of the questions to be asked. On the contrary, Mandala & Gunasekaran (2002) did not justify the primary techniques used to support their statements in their case study; as it is was dependent on secondary resources