It is June 6, Sue McCaskeys first day in the newly created Sue McCaskey knows that although her influence to
position of materials manager for separate Emporium. A initiate changes give be limited, she must wee positive
recent graduate of a prominent business school, McCaskey results immediately. Thus, she decides to abide on
is eagerly awaiting her first real-world problem. At twain overlaps from the broad product line: the EG151
approximately 8:30 A.M. it arrives in the process of status use up gasket and the DB032 drive belt. If she can
reports on inventory and orders shipped. At the top of an demonstrate significant gains from proper inventory man-
extensive computer printout is a handwritten note from agement for just two products, perhaps Block and Spriggs
Joe Donnell, the purchasing manager: Attached you will will give her the backing needed to change the original inven-
find the inventory and customer service performance data. tory focusing system.
Rest assured that the individual inventory levels are accu- The EG151 exhaust gasket is purchased from an over-
rate because we took a complete physical inventory appear seas supplier, Haipei, Inc. Actual demand for the first 21
at the end of hold water week.
Unfortunately, we dont keep com- weeks of 2001 is shown in the following table:
piled records in roughly of the areas as you requested.
However, youre welcome to do so yourself. Welcome
aboard! calendar week ACTUAL DEMAND WEEK ACTUAL DEMAND
A trivial upset that aggregate information is not avail-
1 104 12 97
able, McCaskey decides to randomly select a small sample
2 103 13 99
of approximately 100 items and compile inventory and
3 107 14 102
customer service characteristics to get a feel for the total
4 105 15 99
picture. The results of this experiment reveal to her why
5 102 16 103
Parts Emporium decided to create the position she now
6 102 17 101
fills. It seems that the inventory is in all the wrong places.
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