Replacing Inventory: An Information Based Strategy for Competitive Advantage in Supply Chain Management

Review of Business Research, Vol. 7, No. 3, pp. 148-157, 2007

17 Pages Posted: 24 May 2008

See all articles by Hans P. Borgman

Hans P. Borgman

ESC-Rennes; Leiden University

Wilfred Rachan

Leiden University School of Management (LUSM)

Date Written: October 13, 2007

Abstract

This paper resulted from a study on "The Effects Of Workflow Automation On Supply Chain Customer Synchronization In The Discrete Manufacturing Industry"(Borgman & Wilfred, 2007). Becoming Agile and Lean in manufacturing necessitate that we revisit the way we handle our factors of productions (i.e. man, machine and materials). Most current literature acknowledges that of all the production factors, Inventory is the "low hanging fruit" for improvement. Whilst Inventory has been labelled a liability, why has so little been achieved to managing Inventory and realising the benefits in practice? Our findings guided us towards a proposition for Replacing Inventory with Information. By applying ICT (Information & Communication Technology) based solution to the "Response Time Delay" and "Risk of Uncertainty of Demand" problems, seen here as a dynamic Inventory problem. We were able to develop a framework to determine when Inventory can be replaced with information and when it should not be attempted.

Keywords: Uncertainty, Throughput, Synchronization

Suggested Citation

Borgman, Hans P. and Rachan, Wilfred, Replacing Inventory: An Information Based Strategy for Competitive Advantage in Supply Chain Management (October 13, 2007). Review of Business Research, Vol. 7, No. 3, pp. 148-157, 2007, Available at SSRN: https://ssrn.com/abstract=1132002 or http://dx.doi.org/10.2139/ssrn.1132002

Hans P. Borgman

ESC-Rennes ( email )

2, Rue Robert d'Arbrissel
Rennes, 35000
France

HOME PAGE: http://www.esc-rennes.fr

Leiden University ( email )

Postbus 9500
Leiden, Zuid Holland 2300 RA
Netherlands

Wilfred Rachan (Contact Author)

Leiden University School of Management (LUSM) ( email )

"Gravensteen" Pieterskerkhof 6
2311 SR Leiden,
Leiden, 2311 SR
Netherlands
:+31 71 527 4648 (Phone)

HOME PAGE: http://www.lusm.leidenuniv.nl

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