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Inventory record inaccuracy – The impact of structural complexity and lead time variability

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  • Cannella, Salvatore
  • Dominguez, Roberto
  • Framinan, Jose M.

Abstract

This article presents a rigorous prospective analysis of the impact of Inventory Record Inaccuracy (IRI) on complex multi-echelon Supply Chains (SCs). Specifically, key operational factors (i.e., the magnitude of the error, frequency of the inventory audits and lead time variability) and SC structure are systematically assessed. We find that the detrimental effects of IRI are exacerbated by the structural complexity of the SC and lead time variability. Furthermore, we show how the efficacy of countermeasure strategies may vary depending on SC configuration and operational conditions. These results allow us to provide interesting managerial recommendations to guarantee investment in prevention and correction strategies.

Suggested Citation

  • Cannella, Salvatore & Dominguez, Roberto & Framinan, Jose M., 2017. "Inventory record inaccuracy – The impact of structural complexity and lead time variability," Omega, Elsevier, vol. 68(C), pages 123-138.
    • Handle: RePEc:eee:jomega:v:68:y:2017:i:c:p:123-138
    DOI: 10.1016/j.omega.2016.06.009
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    Cited by:

    1. Hill, Craig A. & Zhang, G. Peter & Miller, Keith E., 2018. "Collaborative planning, forecasting, and replenishment & firm performance: An empirical evaluation," International Journal of Production Economics, Elsevier, vol. 196(C), pages 12-23.
    2. Yun Hui Lin & Yuan Wang & Loo Hay Lee & Ek Peng Chew, 0. "Robust facility location with structural complexity and demand uncertainty," Flexible Services and Manufacturing Journal, Springer, vol. 0, pages 1-23.
    3. Biswal, Arun Kumar & Jenamani, Mamata & Kumar, Sri Krishna, 2020. "The impact of RFID adoption on donor subsidy through for-profit and not-for-profit newsvendor: Implications for Indian Public Distribution system," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    4. Chatfield, Dean C. & Pritchard, Alan M., 2018. "Crossover aware base stock decisions for service-driven systems," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 312-330.
    5. Dominguez, Roberto & Cannella, Salvatore & Barbosa-Póvoa, Ana P. & Framinan, Jose M., 2018. "OVAP: A strategy to implement partial information sharing among supply chain retailers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 110(C), pages 122-136.
    6. Dominguez, Roberto & Cannella, Salvatore & Barbosa-Póvoa, Ana P. & Framinan, Jose M., 2018. "Information sharing in supply chains with heterogeneous retailers," Omega, Elsevier, vol. 79(C), pages 116-132.
    7. Nguyen, Duy Tan & Adulyasak, Yossiri & Landry, Sylvain, 2021. "Research manuscript: The Bullwhip Effect in rule-based supply chain planning systems–A case-based simulation at a hard goods retailer," Omega, Elsevier, vol. 98(C).
    8. Dominguez, Roberto & Cannella, Salvatore & Ponte, Borja & Framinan, Jose M., 2020. "On the dynamics of closed-loop supply chains under remanufacturing lead time variability," Omega, Elsevier, vol. 97(C).

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