Inventory Management System Proposal

The goal all(prenominal)where the exertion statement of the next three months is to implement a newfound broth Process that pull up s defecates allow Riordan Manufacturing, Inc. to hit and deliver electric automobile fans in a more high-octane and precise manner. The implementation of radio receiver frequence Identification (RFID), breed- track outline im element rain buckets line throughput, development ingatheringivity, and constrict production be. In the on-line(prenominal) outdated engross sue, m both problem atomic number 18as in the accumulation line affect can occur, frequently(prenominal) as bottlenecks, mistakes, and inaccurate counts.The proposed form allow for address problem argonas by introducing a just-in- clipping production dodging to correct requite on investment. Tracking register in real- age as it moves through the make out fibril routine depart verify edit outd all overhead of new poppycock and made-to-stock product.The use of RFID technology allow eternise guest establishs, cargo ships of product, and tracking throughput in real-time. With the proposed RFID constitutions and wireless parcel package, trade union movement lives reducing, and sour efficiencies are the resoluteness. Area supervisors go out r distributively the luck to sharpen on problems of greater importance.With the new ferment, production levels provide increase and repulse costs exitinging decrease, drastically reducing the deal of redundant tracking of material and customer products. Implementing an RFID schema exit in any case facilitate compress manufacturing mistakes by closely tracking all move petitiond for product assembly. With measurable victory and melioratement rates, the use of the new Inventory System Process impart help in Riordans future growth. give thanks you for your consideration for this proposal. Please feel absolve to contact if there are any questions.Successful companie s sway inscription, labor party, and other operational costs by closely tracking them. ruin to manage those items competently can cost telephone circuites their bottom line with loss of profit, and ultimately, the insecurity going out of business. Inventory equates to specie and although it is not as liquid, there is legato a cash value associated with each(prenominal) product in register (Chase, Jacobs, & Aquilano, 2006). Riordan Manufacturing is in desperate need of updating their armoury scheme.Initially, when Riordan Manufacturing went into business, this performance was efficient only because they were producing on a smaller scale. As a fortune 1000 company, trying to entertain business growth, Riordan Manufacturing needs to incorporate modern technologies for their stocktaking gibe processes.The inventory process Riordan uses, require umpteen redundant activities needful for tracking, throughout their supply chain. MRP Material resourcefulness Planning, al so known as MRP, software positively can affect a business that relies on efficiencies in manufacturing.MRP helps enterprises control and streamline processes synonymous with order fulfillment. MRP software program is tendencyed to analyze production demands from current sales orders, short and long barrier sales forecasts, and then procures the exact entropy for what is necessary to manufacture each order (Business Software, 2010, p. 1).MRP is a trunk that Learning group up D is proposing Riordan Manufacturing implements to modify productivity and efficiency. The MRP corpse provide help to support the new inventory musical arrangement of development Radio Frequency Identifiers, also known as RFID.The RFID tracking administration exit salmagundi the process of entering data tie in to inventory. The MRP formation will use the RFID system to track the inventory through the process from raw materials received, to molded, assembled, and shipment of the delivered prod uct. In addition, the MRP system will use data from the sales department to calculate how much time required for producing the customers order. As part of the software, data is stored about lurch timelines for both how long it will take to receive raw materials and how long it will take to ship product to the customer.In addition, the system will calculate the materials needed for product assembly, and the timeframes to complete that assembly. By completing these calculations inwardly the MRP system, manufacturing process optimization, limiting inventory on-hand and increase the inventory turnover time. Process visualise Creating a new process design will allow Riordan to constrain more efficient, reducing the inventory on hand. The process design will have a direct and immediate effect on the customer (Chase, Jacobs, & Aquilano, 2006).One main metric that will identify the process is time because it calculates the work-in-process separate by the throughput rate. As a service provider of product, Riordan wants customers to have shorter wait times, and to reduce the organizations investment cost by turning inventory over as quickly as possible. Riordan will fine-tune the inventory process by performing task at a parallel process. Most tasks can give out in sequence that will reduce the waiting time and improve production. other change would be the order of the task in the inventory process.This will go along the back and forth transportation from machines, locations, and departments. In addition, fewer interruptions in the process will prepare purchase orders faster to distract adding extra geezerhood to keeping inventory longer than needed. In these changes, the assembly line will increase productivity and reduce inventory cost.Applying the guide production process will achieve high saturation production development minimal inventories of raw materials, work-in-process, and finished good (Chase, Jacobs, & Aquilano, 2006). The use of RFID will p lay a significant social function for optimizing Riordans inventory solicitude system.The process will work efficiently when demands are at a high quality and builds stronger relationship with the vendors to create the demand for the product. Generally, Riordan will have these tools along with implementing the MRP system to manage inventory flow process. This will create the process of identifying any bottlenecks through the inventory, packaging, labeling, and shipping process. In addition to the MRP system, Riordan will also include the RFID examine system to improve the technology aspect of the business. Supply ChainRiordan will get ahead greatly by implementing an RFID scanning system. Converting the inventory system to implement newer technologies will increase process throughput. Transition to the RFID system will improve Riordans opportunity to compete in the global market.Tracking inventory on paper is not efficient, peculiarly when information gathered needs updated in China by close of business each day. The use of RFID through the Internet, improves Riordans opportunity for growth, keeping track of every item in inventory. With an RFID system, real-time trending and prevision will be possible.Computer software use in conjunction with hardware devices varan the use of inventory more accurately by continually scanning and uploading data. With the use of RFID, Riordan will reduce loss of inventory or wasted product by setting control limits.Ultimately, reducing labor costs and increasing profits. In near industries, labor is the one of their biggest expense. The inventory work casts could have a significant reduction of labor hours and even eliminate the position entirely with an electronic process. The amount of time spent tracking inventory goes from transactions to mere seconds because of RFID technology.As Riordan continues to grow, it is important to established centralised warehouses in key locations. The inventory software will help Riordan executives forecast how much inventory one particular warehouse could handle, more effectively than the current method utilise. Inventory management is the key focus for process improvement.This new inventory management system will reduce labor cost by streamlining data entry, therefore, speeding transaction time, and ultimately, reduce the amount of inventory on-hand. Packaging, labeling, and shipping will involve incorporating a new inventory management process.Combining take hold computers, RFID readers, software, and a wireless infrastructure gives supervisors the strength to monitor inventory and track each activity within the manufacturing process. By connecting a wireless infrastructure, the application will assure in real-time.Supply chain design will enable Riordan to reduce stock on-hand and improve inventory throughput. Maintaining par levels through predict from the materials used, average inventory stock is rendered. carry and supply uncertainties assoc iated with custom products will require a supply chain strategy that incorporates an agile supply chain.Supply chains using strategies aimed at responsiveness, and flexible, overcome the risks of supply shortages by pooling inventory and other capacity resources. As previously mentioned, the current steps for treat raw materials is labor intensive and in many ways, work against the companys long-range strategy.The use of an RFID tracking system will allow more accurate and real-time information to be quickly available. Forecast Forecasting the costs and bear benefits is critical to determining if the project is honorable of investment by a company. This forecast, effected for the implementation of both an RFID and MRP system.There are a number of lucre costs for this eccentric of project, including a project manager salary for one month ($3,333), an install technician for 2 months ($6,600). A trainer for 20 days ($1,640), salaries for 10 technical support agents to be traine d over 10 days ($11,000), and salaries for 100 staff agents trained over 10 days.However, the largest cost for this project will be the technology itself. To install an RFID system the following will need buy active tags at the price of $10 each for 100 in total, pentad $500 readers, and the middleware that coasts $100,000. The MRP software will trifle the biggest price of $300,000.The total costs of implementing the project will be $536,139. Obviously, these costs are only beneficial to the company if they puzzle out about a positive change to the companys income. The implementation of the MRP and RFID system allow the elimination of the inventory clerk position, saving the company $45,000 annually.In addition, supervisors will be more effective as the labor intensive reports are eliminated, saving the supervisors 40 hours a month and the company $959 a month. The manufacturing team will also benefit from the elimination of these labor-intensive reports. Its estimated that the manufacturing team will save $574 a month. In addition, because of the expected efficiencies with managing inventory Learning aggroup D predicts that one facility, currently used to house supplies, is no longer needed saving the company $8,000 monthly, in leases.According to a survey of more than 600 companies, Riordan can expect a number of increased efficiencies. peradventure the most telling increase to surgery is that delivery times will be reduced from 71 days to 59 days on average (Schroeder, Anderson, Tupy, &White, 2012, p. 1). This operator that Riordan will be able to improve order processing by 17%.With profits already at $1,956,371 (Apollo free radical Inc.) annually, a 17% increase would result in an additional $163,031 monthly in profits. Keeping all of this information in mind Riordan would see a chase away on their investment in close to 13 months.ConclusionThe new tracking system will help in backing the principles in strategic capacity readying by allowing Riordan to decrease the waste of resources, such as ordering too many raw materials, using facilities as storage, and using labor hours for data entry. Improving Riordans inventory control process will produce a more efficient supply chain management, translating into increased customer satisfaction.Both strategic capacity planning and lean production play an integral part in the improved inventory system at Riordan. The strengths for Riordans new process will increase productivity, and enhance the products flavor cycle. Building a better strategy will open the door for come on growth opportunities.It will take a team to develop the strengths and opportunities of the new inventory management process. Measures of changing the supply chain design by adding the new RFID to Riordans inventory system will become the reason for Riordan becoming the leader in the electric fan industry. (Note see appendix A for Gant chart)