| Topic : Effectively Managing Replenishment And Inventory Levels |
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Inventory Controllers
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Source : http://findarticles.com
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last activity : 07 06 2010 20:18:04 +0000
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THE WAY THAT movements in inventory investment dominate business cycles is well known. In the six most recent recessions, for example, changes in inventory investment accounted for an average of 98 percent of the peak-to-trough changes in gross domestic product. At other stages of the business cycle, too, GDP and inventory investment often move together.
Many business analysts have suggested that improvements in inventory control, such as just-in-time and production-to-order, have reduced the influence of inventory investment on business cycles. We investigated this issue in our recent empirical study.(1) We tested the hypothesis of whether inventory control has improved and we found that it has. We concluded, however, that improved inventory control has increased the volatility of inventory investment and, therefore, the sensitivity of the business cycle to swings in inventory investment.
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