The Art of Inventory
9. Train your people.
Inventory management is a complex and frequently thankless job, and when the situation takes a turn for the worse, the inventory manager is often the first (and only) one called on the carpet. Inventory management is a team effort; it takes cooperation and active participation by acquisitions, sales, marketing, distribution and production, and each function plays an important role in the process. Train your people. Make sure they understand the role they each play and how their actions contribute to the larger objective. Include inventory performance metrics in the goals and objectives.
10. Segregate duties.
Make sure that reporting relationships are structured to support well-considered inventory decisions. Inventory management teams should not report to the sales department (they have an understandable inclination to be sure that there's always enough inventory available to fill every order that comes in) or the production department, where the emphasis on unit manufacturing cost and leveraging economies of scale may lead to print orders for more units than circumstances might require.
11. Love your inventory manager.
A good inventory manager is a gift from the gods, so despite the fact that this may not be the most glamorous job in the organization, if you've got a good one, make sure they feel the love. Recognize that mistakes, even by the best inventory manager, are inevitable, and make sure there's some recognition for a job well done. Inventory management is likely to become more complex in the years ahead, and every dollar freed up from inventory is a dollar that can be invested elsewhere. BB
David Hetherington is director of major account sales for Baker & Taylor's Digital Service Group and an adjunct professor at the Pace University Graduate School of Book and Magazine Publishing. He was previously managing director for strategic business development for Integrated Book Technology, and has held senior positions in finance, operations and manufacturing with some of the industry's largest firms, including Simon & Schuster, Reader's Digest Association, BearingPoint Consulting, Wolters Kluwer Health and Columbia University Press.