DMAIC - the five letters that define any process improvement exercise. In inventory management - whether it's bar coding your stock, implementing a cycle count program, or setting up safety stock levels - these five letters and their definition will help in going through whatever it is you need to improve. Let's delve into what it all means to you:

D = Define. You've identified an issue with how much product is coming in, and how much is going out. It may be that you have too much stock, or not enough of the right stock. Whether in retail or warehousing, you will need to define what the problem is. It's a critical first step because if you can't define what it is, you may find that you're not solving what the real problem is. This will ultimately waste your time and you'll keep spinning your wheels.

M = Measure. A lesson I learnt over a decade ago is if you can measure it, you can manage it (Thank you J.S.!). Once you define what the problem is, you need to think about where you stand. There is no short cut to this and it is also a critical step in the process. For example, when you look at your supply chain, you will want to know if you can get a better price for your products. But you won't know this if you can't figure out what you paid last time.

A = Analyse. Analysis requires thought-provoking questions that need to be asked. Sometimes the answers are easy. But most times, the answers are hard and tough. All isn't lost. Analysis is a lot easier when you have good data to analyze. You can then create a trail to figuring out why things aren't working like you want it to. Having a good inventory management system can help in your analysis.

I = Improve. After defining the issue, measuring where you stand with it, and analysing why things aren't the way they should be, it's time to weigh your options, take a decision and make the change. Let's be clear. Change isn't easy. But change can be good. Change can be rewarding. But only if it's done right! This can take anywhere between a week for smaller changes, to a couple of years for larger more complex process improvements. Think about how long it would take if you were to properly implement a new inventory management system! A quick note here that for strategic projects, consultants usually do the analysis, and make the case for change. Implementation of the change would be usually handled by you - the client.

C = Control. All of this leads to better controls being put in place for you to manage your inventory. As I always say, and it's embedded in my message on my website (www.perennialbusinessconsulting.ca), I don't want to be in your business for the long haul, I want you to be in business for the long haul. That means that once there is improvement through implementation, you need to keep a keen eye on what you've implemented and tweak it as needed, leading to continuous improvement.

R = Repeat. If you keep on top of what was changed, and recognizing that it'lbe tweaked as conditions change, the process keeps repeating. And it becomes easier to manage!

As I said when we kicked off this article, DMAIC are the five letters that define any process improvement exercise. If you're thinking of optimizing your inventory to gain greater financial stability and better business management, contact us a Perennial Business Consulting.

t: 289-233-4735 | e: info@perennialbusinessconsulting.ca | w: www.perennialbusinessconsulting.ca

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All the best,

Ansar

Define. Measure. Analyse. Improve. Control. Repeat.

Ansar Khan

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