Inventory Management at Crayola
Inventory management entails planning and controlling inventories to meet an organization’s objectives and maintain a competitive advantage over its rivals. The main aim of inventory management is to attain a balance between customer service and inventory investment. At Crayola, inventory management is a balancing activity. Crayola is a manufacturing company dealing in producing and supplying art supplies such as crayons.
Crayola Company experiences three seasons in one year of production. The seasons include the back-to-school, spring, and holiday seasons. The back-to-school seasons drive 42% of the demand for products from their consumers to the company for paints, crayons, markers, and modelling compounds. It may create a risk for the company if it fails to predict the demand and production of the products accurately; thus, its productions start as early as February to ensure that enough finished goods will be available in time for supply in the seasons (Krajewski, 2020, p. 9). To ensure this goal is achieved, the company has located suppliers of raw materials close to their plants to ensure the material requirements planning systems and focus on appropriate forecasting. Inventory in Crayola is classified as raw material, work in progress, and finished goods. The small inventory level in Crayola Company is validated by handling costs, cost of capital, insurance, taxes, and storage. In contrast, a larger inventory is validated by setup costs, low transport costs, low supplier payments, utilization of equipment, and improved labour.
The organization of work plans and early preparation by the Crayola Company is beneficial in my daily life and work activities because it helps me ensure that my work is in order and can be done without the pressure of delivery. This enables work to be accomplished effectively and done in a precise order with no rush. Early preparation also ensures that the products can be inspected if completed as per the order. If there is any error, it can be rectified before being delivered to the customers. This also provides customer satisfaction because they will attain the products within the stipulated time, and such products will retain high quality. Challenges I may face in implementing these strategies in my life and work activities include a lack of motivation in my working environment to carry out activities before the due dates. Lack of confidence in implementing the activities due to lack of skills and confidence in pushing forward my ideas to be heard and implemented. Through the lessons learned from Crayola, the constructivism theory of learning can be best implemented (Schunk, 2012, p. 53). Constructivism theory describes a scenario in which people are responsible for creating and implementing their understanding of a concept based on the experiences and knowledge gained to link new information to those lessons.
Management in inventory control entails attaining a balance between customer service and inventory investment. This can be achieved by maximizing customer service and operating efficiency while minimizing inventory investment. The sessions have helped me know that management entails internal control of the organization and the external environment, especially the customers who need to be satisfied by the products and services offered to motivate them to re-purchase. The external environment of the business should be granted as much attention as the internal organizational environment to ensure the continuity of the business. To close gaps available in management, the gaps should be identified, conduct a skill mapping exercise, identify the appropriate opportunities directed toward closing the gap, implement learning experiences, and monitor the progress of the implemented experiences. Carrying out this procedure will help me learn what experience can work within the organization and which cannot to implement real change and ensure lasting progress within my work life.
Crayola’s inventory management strategy entails two levels of strategies, small inventory and large inventory. Issues that may arise in small inventory entail the risk of a shortage of inventory that may lead to an unsatisfactory relationship with customers since their demands will not be met. However, a large inventory may reduce the profitability potential of the organization. Therefore, to achieve more, the company should understand their market and know the advantages and disadvantages of the inventory levels to make a rational decision for the company. In my daily life activities, this concept can be applied while making decisions, to research, and have information on the benefits and risks of my choices before deciding to ensure the decision made will be for my benefit and of those around me. Knowing the outcomes of the choice, we make help us in avoiding errors, saves on cost and time, and ensure the trust with the people we serve is maintained and improved. Managing inventory within an organization benefits the organization by ensuring all the resources are utilized as planned and the customers in ensuring demands are adhered to and accomplished.
Krajewski, L.J., Ritzman, L.P., Malhotra, M.K., 2020. Operations Management: Process and
Supply Chains 12th edition. Inventory Management, pp (9)367
Schunk, D.H., 2012. Learning theories an educational perspective sixth edition. Pearson, New