Abstract
Abstract : The inventory management system is one of the most crucial components of the total assets of any organisation. Business organisations, especially multinational firms, hold inventories with the aim of having enough stock or spare parts to avoid company production downtime. Conversely, additional inventory takes up needless space within the warehouse, and most significantly, ties up financial resources and reduces company productivity. Hence, achieving the right balance of inventory extent, which would diminish inventory rate and uphold a beneficial extent of consumers’ service, is one of the most critical challenges to many business organisations. To this end, this study’s overall aim was to assess the effectiveness of the inventory management system of the wind tunnel facilities using a South African company. To achieve this goal, this study adopted a twofold approach. First, the existing literature was critically reviewed and led to identifying gaps. Secondly, the identified gaps were addressed by various consultations with experts from different wind tunnel testing industries. Data from the research were analysed using the quantitative research method, descriptive statistics and exploratory factor analysis. Findings from the data analysis revealed that the challenges to an effective inventory management system are supplier lead times that are long and unrealistic. Furthermore, the wind tunnel original equipment manufacturers are not local suppliers and no longer operational. In addition, more organised inventory storage areas, providing flexibility to adapt to any arising situation in the facility and aiding in accurate planning, are ranked top benefits of effective inventory management system adoption. Finally, the study identified that sufficient in-house control mechanisms for the overall inventory system and having a dedicated person for the inventory in the wind tunnel facilities as the top drivers of having an effective inventory management system in the wind tunnel facilities. Based on the findings of this study, a conclusion was drawn noting that there is a need for a list of alternative equipment spare parts and identification of common inventory for equipment. The importance of maintaining the list of original equipment manufacturers and distributors per item was noted. The need for criticality analysis of each stock item that includes application, classification, original equipment manufacturers, prices and lead times were also noted as factors that can be adopted in having an effective inventory management system. These findings have relevant business implications. In this context, understanding the different approaches to inventory management as utilised in wind tunnel facilities is critical to the efforts of these organisations’ performance improvement efforts.
M.Tech. (Operations Management)