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I’m currently working on project with a topic on analysis on several warehouse operations. Which scopes from receiving items up to shipping them out to the warehouse. My problem is the company is experiencing several transaction errors in their system which led to inventory inaccuracy in their records. I already did some analysis through the use of SIPOC and RCA.

One of the main errors that I found to be the cause of of such transaction errors was the unorderly queuing of how inventory is handled. Which led to missing inventory, unrecorded picking jobs, unrecorded release of parts, and etc. I have already consulted it to some of the personnel in-charge of the different warehouse processes and they do agree that implementing a scheduled process instead of a one-to-one process would indeed improve the quality of inventory handling and have an improvement in their inventory records which I also derived from the RCA analysis.

The part where I’m having a problem is how should I present these findings and justify that a conversion to a “Scheduled process” is the way to go? I’ve seen some problems quoting the improvements in process efficiency are one of the justified reasons but in my case, process efficiency is not my main concern but the inventory accuracy of the warehouse. Since this is more of a transaction type problem rather than an efficiency type, I’m having trouble justifying and presenting my findings through a cost-benefit analysis way.

Just to clarify, I’m asking if there are other ways to justify the process to be scheduled such as put-away or pulling of items other than being derived as a solution from interviews and analysis or is it being derived from an RCA enough? Also, other than efficiency ratios as well as it’s not an efficiency problem.

  • To me it looks like an X/Y problem: their existing inventory system has bugs which leads to inaccuracies, and now you're looking for justification to replace the system with something new of which you don't even know which bugs it will have. Wouldn't it be more efficient to plug the holes in the existing process? If the root cause of inconsistencies is missing or incorrectly ordered events then switching to a scheduled process most likely won't fix it. – Hans-Martin Mosner Jul 19 at 7:41
  • Agree with Hans Martin above. This is a X/Y problem. If you have done your RCA and if you are 100% sure you have identified the root cause, why cant you get the operational cost for current system (X), operational cost (Y) with the problem solved, X-Y in a financial terms should do the convincing part. Of course you will have to have some assumption and validations with Y calculations. – Kalpa Gunarathna Jul 22 at 7:07
  • Thank you for your comments. So I should just base it in operational costs per system X versus system Y? Sorry I didn't think of this, I was fixated on finding the savings per system X and system Y where I could have instead looked at both of its operational costs. If I am unable to simulate such assumptions on changes for the costs of system Y, how would you suggest on calculating it? I have a feeling its based on operational and efficiency improvement, but it throws me in a loop since I can't calculate since there are no simulations. – Czar Luc Jul 23 at 19:55

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