Inventory Management through Lean Logistics and Warehousing Techniques

Inventory is one of the eight deadly wastes in Lean. It is caused by overproduction (producing more than is immediately needed) but in turn it causes several other wastes. How does excess inventory manifest itself? I.e. Extra space, Extra people, waste conveyance, extra costs. Inventory management in lean is built around the same principles that govern most lean activity: create a simple set of tools that can be used directly in the workplace that will help surface problems so that they can be addressed. Inventory management is thus quite different in lean, starting with the view of inventory as a waste rather than an asset. From a practical point of view, what this means is that inventory reduction is built into the fabric of the system, just like it is for any other waste. Because of this, they are typically no special efforts or programs aimed at reducing excess inventory. Reducing inventory is a part of everyday work life. In this paper we will cover two important topics for the supply chain, warehousing and logistics. We will cover the traditional view of physical control of inventories, then the relationships between the warehouse and the organization and then we review traditional logistics activities. In second half of this research paper we will review distribution requirements planning, Lean warehousing and Lean logistics