Slide MGT209 Slide12

Operations
Management
Inventory Management
Chapter 12
Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and
Operations Management, 7e

12-1

© 2004 by Prentice Hall, Inc., Upper Saddle
River, N.J. 07458

Outline
 GLOBAL COMPANY PROFILE:
AMAZON.COM
 FUNCTIONS OF INVENTORY


Types of Inventory

 INVENTORY MANAGEMENT





ABC Analysis
Record Accuracy
Cycle Counting
Control of Service Inventories

Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and
Operations Management, 7e

12-2

© 2004 by Prentice Hall, Inc., Upper Saddle
River, N.J. 07458

Outline - Continued
 INVENTORY MODELS



Independent versus Dependent
Demand
Holding, Ordering, and Setup Costs

 INVENTORY MODELS FOR
INDEPENDENT DEMAND






Basic Economic Order Quantity (EOQ)
Model
Minimizing Costs

Reorder Points
Production Order Quantity Model
12-3 Models
Quantity Discount

Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and
Operations Management, 7e

© 2004 by Prentice Hall, Inc., Upper Saddle
River, N.J. 07458

Outline - Continued
 PROBABILISTIC MODELS WITH
CONSTANT LEAD TIME
 FIXED PERIOD (P) SYSTEMS

Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and
Operations Management, 7e

12-4

© 2004 by Prentice Hall, Inc., Upper Saddle
River, N.J. 07458

Learning Objectives
When you complete this chapter,
you should be able to :
Identify or Define:






ABC analysis
Record accuracy
Cycle counting
Independent and dependent

demand
Holding, Ordering, and Setup Costs

Describe or Explain:


The functions of inventory and basic
12-5
inventory models

Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and
Operations Management, 7e

© 2004 by Prentice Hall, Inc., Upper Saddle
River, N.J. 07458