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Evaluation of Several Methods of Scheduling and Conducting Physical Inventories.
NAVAL POSTGRADUATE SCHOOL MONTEREY CA
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Advanced operations research procedures have provided the inventory manager a set of optimal decision rules for operating his inventory system. However, these decision rules are applied to information from inventory records that may be in error. If the records are in error the decision rules no longer insure optimal operation of the system. The paper addresses the problem of which physical inventory procedures best maintain record accuracy at a satisfactory level. Four physical inventory procedures are discussed and then tested using a Monte Carlo computer simulation of a multiple item, single warehouse, single inventory manager supply system. Discrepancies of various types are introduced into the records reflecting estimates obtained from a large naval supply center. For high demand items accuracy levels above 90 percent are not feasible. The wall-to-wall inventory appears to be the most economical system in most situations. Suggestions are made for subsequent research. Author
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