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Transportation & Logistics Management (MGMT615)

 

Total Marks: 5

 

Objective:

To reinforce the concept of inventory management under uncertainty.

 

Scenario:

The world has witnessed global supply chain flutters many times in the history. Managing operations and inventory accuracy across the organization and its distribution network have become more critical to mitigating risk and to run operations smoothly.

For instance, the recent COVID-19 outbreak has exposed the traditional supply chain networks in the sequel of lockdown. Especially, the retailers are facing a variation in demand from customers and a disrupted supply from the suppliers. Demand variations may create a bullwhip effect on inventory and disruptions in cash flows. Increasing the level of safety stock pushes investment in inventory upward whereas uncertain demand resists the retailers to hold excess inventory. So, it is the need of time to review the supply chain strategy and inventory management!

 

Discussion Question:

Eyeing critically on the above-mentioned trade-off in the supply chain, you are required to suggest whether the retailers should hold excessive inventory or avoid overstocking to mitigate the risk in this pandemic era and for a smooth flow of business.

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