Inventory Management System - Case Studies

ScottMadden worked with a wireless data and Internet services provider (ISP) to design and implement a disciplined inventory management system.

The organization's business model depended on device-level inventory tracking to manage margins
No method existed to reconcile costs incurred against revenues
Product margins were negative
The business units lacked planning tools and reporting metrics

Developed an end-to-end process that accounts for device-level tracking from beginning to end
Implemented a set of daily and weekly pipeline management tools to plan and procure inventory
Created a comprehensive inventory management system system to account for the state of all devices, tying hardware to service costs
Using the tracking system, produced real-time reverse logistics management and third-party service cancellation processes
Established a set of regularly published operational metrics to manage cost of goods sold (both hardware and service costs)

Recurring customer costs were reduced by 22% over one quarter, due to identifying and streamlining service costs not associated with revenue paying customers
Daily inventory carrying costs slashed by 28% within six weeks of implementing new inventory management system
Stock-out situations were virtually eliminated
Business turned from margin negative to margin positive
Customer experience improved and customer turnover reduced

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