INCREASE INVENTORY MANAGEMENT PERFORMANCE: A CASE STUDY OF A GOVERNMENT AGENC AAA Research Aticle

Abstract

The aim of this research was to examine the existing circumstances and challenges associated with inventory management. It involved conducting case studies to regulate inventory levels appropriately and explore methods to quantify the ideal inventory levels. The investigation revealed that the organization faced issues in its inventory management process, including overstocking certain supplies and inadequately meeting demand for others, primarily due to a lack of knowledge and competence among warehouse staff. Insufficient regular inspections of parcels and unclear, disorganized parcel storage classification contributed to problems such as expired and deteriorated inventory, the researcher applied the ABC Analysis theory to categorize inventory based on its value and utilized the FSN Analysis theory to classify parcels according to their turnover rate. Subsequently, these two theories were combined in a Matrix table format, providing a guideline for arranging each type of parcel in the appropriate order. Furthermore, the layout of the warehouse was redesigned to enhance the storage format and maintain inventory at optimal levels. The results demonstrated that implementing this strategy allowed for effective management of inventory to meet demand while reducing the number of less sought-after parcels. Consequently, this approach significantly improved the efficiency of the warehouse management process and reduced the costs associated with excess stock.