Improvement of Inventory Sharing Process at Home Furnishing Company

This research analyses the inventory-sharing process for a home furnishing company with decentralized inventory management that executes an inventory-sharing process called stock balancing, which aims to balance inventory levels between stores. Previously, the inventory exceeded total capacity with a high overstock level, but product availability was low, thus affecting business commerciality and stock holding. The cycle time of weekly execution was too long, up to one month, and did not significantly impact inventory structure due to inventory discrepancy. This study aims to investigate and identify issues in the current stock balancing process, to analyze the impact on total inventory level, and also to design business process improvement in a shorter cycle time. A qualitative method is conducted in this research, and data collection is done through interviews and observations. The research began with analyzing the current process to identify the root cause. Then, proposing process improvements through ten business process improvement steps, including techniques such as nonvalue added analysis, elimination, reduced cycle time, and automation. The result projects that the stock balancing process can be improved by eliminating four duplicating activities, and the cycle time could be shortened by 50%. In addition, this study suggests supporting factors such as system integration and dedicated manpower to fully support the stock balancing process.