Study On Inventory Improvement For ST Company

Nowadays more and more company is highlighting importance of lean in production, and gradually is requesting supply chain should also be under lead control. Since inventory management is part of supply chain, keeping optimizing inventory would be essential to supply chain management. Thus it is very meaningful to do some study on inventory control and optimization on one company.This paper is done by combining the theory with example analysis on some weakness found in its inventory control of ST company and related effective solutions to them which had been monitored by tracing over 6 months of operation. The improvements are carried out from demand management,APQP, information sharing, supplier performance appraisal, product classification and inventory control tactics. Details shows 1.On demand management,the agreement on fluctuation on demand based on month evolution and related liablity had been signed, this ensure the stability of supply.2. On APQP, supply management will be introduced into project start phase by strict controlling of supplier selection, this help reducing risks in future operation.3. On information sharing, rules had been set up in the whole supply chain to ensure the inventory of each stage on the chain could be optimized.4.On supplier performance appraisal, KPI setting had been completed which ensure performance appraisal in future more correct.5.On product classification, ABC rule had been adopted which made inventory management more robust and inventory structure more reasonable.6.On inventory tactics, right rules had been adopted on safety stock and reorder point setting and the inventory control is safer than before.Performance of Inventory turns, On-time delivery rate and Freight had been monitored by using new control way and the results are pretty positive as Inventory turns had got 7% improvement, On-time delivery rate had got 24% improvement and Freight had achieved company goal. It proved that the actions taken in the past are effective and sustainable.