Journal of Korean Society of Industrial and Systems Engineering (산업경영시스템학회지)

Society of Korea Industrial and System Engineering (한국산업경영시스템학회)
권호 표지
DOI QR코드

DOI QR Code

A Study on the Inventory Cost Estimation Criteria Considering Supply Chain Characteristics of a Electronic Product Manufacturer

전자제품 제조사 관점에서의 공급사슬 특성을 고려한 재고비용 산정 기준의 제시

  • 남정훈 (한양대학교 일반대학원 경영컨설팅학과) ;
  • 황승준 (한양대학교 경상대학 경영학부)
  • Received : 2016.08.22
  • Accepted : 2016.11.09
  • Published : 2016.12.31
Download PDF
⟨ Previous Next ⟩

Abstract

SCM activities in a company are considered as total innovation through synchronizing supply and demand while maintaining appropriate inventory level and reducing the business operating costs. Until now, even several researches are carried out on the SCM performance of the companies which have introduced and been operating SCM, the research on the cost analysis for the inventory which occurs frequently on supply chain is still insufficient. Especially, for the electronics industry in which the product depreciation is sharp caused by the short product life cycle and the complexity of distribution channels, even the inventory related costs are a major factor in business management, since the current estimated criteria of inventory costs are limited to the interest and maintenance management costs, the criteria do not reflect the total influence of the product depreciation and lost opportunity cost which are related to the business management. Furthermore, even though the rapid price drops of the distributor inventory caused by the frequent new model launch can be covered by the product manufacturers, the scale of total costs related to the inventory has not been conceived because the price compensation is traditionally considered as a market costs. In this research, we analyzed the inventory characteristics of electronics industry in which the price depreciation happens frequently, newly defining the estimated criteria of the product total inventory cost which includes price depreciation from the product manufacturers' view. Finally we focus on the case study of a representative electronics company and verify the scale of the influence on management performance.

Keywords

References

  1. Ahn, S.H. and Lee, Y.H., Development of Framework for Measuring Performance of Service SCM using Fuzzy- AHP, Journal of the Korea Society of Supply Chain Management, 2010, Vol. 10, No. 2, pp. 1-9.
  2. Bae, B.K., Cho, J.H., Oh, S.I., Yang, K.M., and Kang, K.S., A Development of Scheduling Simulation Model for Reducing Inventory Cost-For Electronic Materials Industry-, Conference Proceedings of Korea Safety Management and Science, 2007, pp. 411-423.
  3. Beamon, B.M., Measuring Supply Chain Performance, International Journal of Operations and Production Management, 1999, Vol. 19, No. 3, pp. 275-292. https://doi.org/10.1108/01443579910249714
  4. Brewer, P.C. and Speh, T.W., Using the balanced Scorecard to measure Supply Chain Performance, Journal of Business Logistics, 2000, Vol. 21, No 1, pp. 75-94.
  5. Callioni, G., Montgros, X., Slagmulder, R., Wassenhove, N., and Wright, L., Inventory Driven Costs, Harvard Business Review, 2005, pp. 135-142.
  6. Capkun, V., Hameri, A., and Weiss, L.A., On the Relation- ship between inventory and financial performance in manufacturing companies, International Journal of Operations and Production Management, 2009, Vol. 29, No. 8, pp. 789-806. https://doi.org/10.1108/01443570910977698
  7. Chen, F.Y., Wang, T., and Xu, T.Z., Integrated Inventory Replenishment and Temporal Shipment Consolidation : A Comparison of Quantity-Based and Time-based Models, Annals of Operations Research, 2005, Vol. 135, No. 1, pp. 197-210. https://doi.org/10.1007/s10479-005-6241-9
  8. Deloof, M., Does working capital management affect profitability of Belgian firms?, Journal of Business Finance and Accounting, 2003, Vol. 30, pp. 573-588. https://doi.org/10.1111/1468-5957.00008
  9. Demeter, K., Manufacturing Strategy and Competitiveness, International Journal of Production Economics, 2003, Vol. 81-82, pp. 205-213. https://doi.org/10.1016/S0925-5273(02)00353-5
  10. Fisher, M.L., What is the Right Supply Chain for Your Product?. Harvard Business Review, 1997, pp. 105-116.
  11. Gartner Group, The Gartner Supply Chain Top 25, 2014, www.gartner.com/technology/supply-chain/top25.jsp.
  12. Hanfield, R.B. and Nichols, E.L., Introduction to Supply Chain Management, Upper Saddle River, 1999, New York, Prentice Hall.
  13. Jhang, G.J. and Woo, Y.S., The Study on the Inventory as Performance Measures in Supply Chain Management and Financial Performance, Korean Journal of Business Administration, 2012, Vol. 25, No. 6, pp. 2629-2664.
  14. Jhang, G.J. and Yang, J.H., The Study of the Relationship between Cash-to-Cash Cycle Time and Financial Performance of Korean Companies in various Industry and with Different Sizes by Using Multiple Linear Regression Analysis, Journal of the Korea Society of Supply Chain Management, 2011, Vol. 11, No. 2, pp. 55-73.
  15. Jang, H.W., Lee, S.S., and Park, B.K., A Study on the SCM Activity and Business Performance varied with the Supply Chain Structure, The Journal of Information Systems, 2006, Vol. 15, No. 2, pp. 173-193.
  16. Jung, P.C., Study on Inventory Cost and Optimal Inventory Management in Korea Liquor Industry, Journal of Tax Studies, 2004, Vol. 4, pp. 564-613.
  17. Kaplan, R.S. and Norton, D.P., The Balanced Score Card Measures that Drive Performance, Harvard Business Review, 1992, pp. 71-79.
  18. Kim, D.K., Kwon, O.K., and Baik, I.S., An Empirical Study on the Supply Chain Asserts Performance of Korea Companies, IE Interface, 2003, Vol. 16, No. 2, pp. 167-173.
  19. Kwon, H.C., The Optimal Inventory Modeling and The Cost Sensitivity Analysis with Reducing Inventory Investment, Journal of Digital Convergence, 2013, Vol. 11, No. 12, pp. 265-274. https://doi.org/10.14400/JDPM.2013.11.12.265
  20. Lambert, D.M. and Stock, J.R., Strategic Logistics Management. 2001, 4th Ed, McGraw-Hill.
  21. Lee, H.L., Aligning Supply Chain Strategies with Product Uncertainties, California Management Review, 2002, Vol. 44, No. 3, pp. 105-119. https://doi.org/10.2307/41166135
  22. Lee, K.K. and Yoon, S.C., A Study on an Inventory Control Method using Cooperative Sourcing among Sales Branches, Journal of the Korean Production and Operations Management Society, 2016, Vol. 27, No. 1, pp. 27-45.
  23. Nobanee, H., Abdulatif, M., and AlHajjar, M., Cash conversion cycle and firm's performance of Japanese firms, Asian Review of Accounting, 2011, Vol. 19, No. 2, pp. 147-156. https://doi.org/10.1108/13217341111181078
  24. Noh, J.D. and Lee, H.S., Differentiated SCM Strategies base on Characteristics of Enterprises, Korean Journal of Logistics, 2006, Vol. 14, No. 2, pp. 159-187.
  25. Pagh, J.D. and Cooper M.C., Supply chain Postponement and Speculation Strategies : How to choose the right Strategy, Journal of Business Logistics, 1998, Vol. 19, No. 2, pp. 13-33.
  26. Park, H.S., Park, K.H., and Kim, T.Y., A Computation Model of the Quantity Supplied to Optimize Inventory Costs for Fast Fashion Industry, Society of Korean Industrial and Systems Engineering, 2012, Vol. 35, No. 1, pp. 66-78.
  27. Park, I.G., Kang, S.W., and Kang, K.S., Effect of Distribution Center Consolidation and Inventory Reduction on Logistics Cost, Journal of Korea Safety Management and Science, 2015, Vol. 17, No. 1, pp. 265-270. https://doi.org/10.12812/ksms.2015.17.1.265
  28. Park, M.H., Ju, K.J., and Lim, S.I., Effectiveness of Quality Management System Implementation Based on BSC Framework, Journal of Society of Korea Industrial and Systems Engineering, 2011, Vol. 34, No. 2, pp. 85- 91.
  29. PRTM Consulting, Third Annual Supply Chain Performance Benchmarking Study, 1994.
  30. Shin, H.K. and Hong, Y.S., Developing a Framework for Supply Chain Performance Measurement using SCOR Model and Desirability function, Entrue Journal of Information Technology, 2007, Vol. 6, No. 1, pp. 155-170.
  31. Simchi-Levi, D., Kaminsky, S., and Simchi-Levi, E., Designing and Managing the Supply Chain : Concept, Strategies and Case studies. 2003, 3rd Ed, McGraw-Hill.
  32. Supply Chain Council, Supply Chain Operation Reference Model Ver. 10.0. SCC, 2010, www.supply-chain. org/f/SCOR-Overview-web.pdf.
  33. Swamidass, P.M., The effect of TPS on US manufacturing during 1981-1998 : Inventory increased or decreased as a function of plant performance, International Journal of Production Research, 2007, Vol. 45, No. 16, pp. 3763-3778. https://doi.org/10.1080/00207540701223675
  34. Yang, B.H., A Remote Facility Management in Multistage Supply Chain, Journal of the Korean Institute of Plant Engineering, 2006, Vol. 11, No. 1, pp. 15-22.
  35. Yu, S.J. and Yun, J.W., Study on impact of SCM/BSC Application Degree on Performance Measurement System and Corporate Performance, Korean Journal of Business Administration, 2005, Vol. 18, No. 3, pp. 1205- 1246.