The first step in our series is going to get at the heart of the issue with a single blunt truth:
YOUR COMPANY AND TEAM MEMBERS DON'T CARE HOW MUCH INVENTORY THEY CARRY.
Looking at the direct time investment of most of your teams, they spend their time doing the following:
1. Answering for fill rate issues
2. Researching why planned production or purchases weren't fulfilled
3. Minimizing the damage coming from unreliable suppliers
4. Finding a home for obsolescent inventory
Most companies are aware of their service levels to their customers and suppliers that have the most issues. Without data or analysis beyond that, planners are told to maximize service and minimize the damage from the other issues.
These desires are noble, however this apathy exists in companies without a problem solving culture. Pretty soon they are adding warehouses, loading up on raw materials as well because every time there is a problem the solution is more inventory, we've even seen companies and teams losing track of where their inventory is or why they put it there in the first place.
Reducing inventory leads to network simplification and many financial benefits: