Taking the Guess Work Out of Identifying Excess Inventory

“Snowflakes are one of nature’s most fragile things, but just look what they can do when they stick together.” -- Vesta M. Kelly, Author Like visibility, the positive impact of collaboration is well known. And, when applied consistently to the Federal Government’s inventory management system, it is a tremendously effective cost-saving tool, by creating a more accurate forecasting and replenishing process.

How do we do this? We believe that continuous inventory management improvement is critical, and it is based on three guiding principles: Visibility Collaboration Optimization We’ll use this post to describe the first principle of “Visibility.”     “You Cannot Control That Which You Cannot See”

Why the Peanut Butter Approach Doesn’t Work Sure, when making a peanut butter sandwich, we want the peanut butter spread evenly across every corner of the bread. The distribution is equal, and every bite tastes the same. But if you apply the same tactic as an inventory cost-reduction strategy to all areas of a large organization, the results will be inadequate item availability and a decline in customer service. That’s why the needs, productivity, and capacities of different departments have to be analyzed before taking broad inventory reduction actions.

Procurement reform is nothing new.  Remember when Vice President Al Gore smashed that ashtray on television as he was launching the Reinventing Government campaign?  That was 1993.  Plenty of good things have occurred in the world of Federal procurement reform in the years since.  Yet we still struggle with the same challenge: making sure that the government and more importantly the taxpayers get the maximum bang for their buck.

Debra Cammer Hines, an IBM Vice President, leads IBM’s Public Sector Consulting Business.  In her role, she leads an organization of 2200 management consultants providing consulting services (financial management, strategy & change, human capital management, supply chain management, customer relationship management and business analytics and optimization) across the Federal government, as well as the State & Local government, healthcare, and education industries.  Debra was one of the authors of Managing Public Dollars: New Rules, New Roles, New Opportunities for Feder