Inventory Record Inaccuracy: An Empirical Analysis
Traditional inventory models, with a few exceptions, do not account for the existence of inventory record inaccuracy (IRI), and those that do treat IRI as random. This study explores IRI observed both within and across product categories and retail stores. Examining nearly 370,000 inventory records...
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| Veröffentlicht in: | Management science 2008-04, Vol.54 (4), p.627-641 |
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| creator | DeHoratius, Nicole Raman, Ananth |
| description | Traditional inventory models, with a few exceptions, do not account for the existence of inventory record inaccuracy (IRI), and those that do treat IRI as random. This study explores IRI observed both within and across product categories and retail stores. Examining nearly 370,000 inventory records from 37 stores of one retailer, we find 65% to be inaccurate. We characterize the distribution of IRI and show, using hierarchical linear modeling (HLM), that 26.4% of the total variance in IRI lies between product categories and that 2.7% lies between stores. We identify several factors that mitigate record inaccuracy, such as inventory auditing practices, and several factors that exacerbate record inaccuracy, such as the complexity of the store environment and the distribution structure. Collectively, these covariates explain 67.6% and 69.0% of the variance in IRI across stores and product categories, respectively. Our findings underscore the need to design processes to reduce the occurrence of IRI and highlight factors that can be incorporated into inventory planning tools developed to account for its presence. |
| doi_str_mv | 10.1287/mnsc.1070.0789 |
| format | Article |
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This study explores IRI observed both within and across product categories and retail stores. Examining nearly 370,000 inventory records from 37 stores of one retailer, we find 65% to be inaccurate. We characterize the distribution of IRI and show, using hierarchical linear modeling (HLM), that 26.4% of the total variance in IRI lies between product categories and that 2.7% lies between stores. We identify several factors that mitigate record inaccuracy, such as inventory auditing practices, and several factors that exacerbate record inaccuracy, such as the complexity of the store environment and the distribution structure. Collectively, these covariates explain 67.6% and 69.0% of the variance in IRI across stores and product categories, respectively. 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This study explores IRI observed both within and across product categories and retail stores. Examining nearly 370,000 inventory records from 37 stores of one retailer, we find 65% to be inaccurate. We characterize the distribution of IRI and show, using hierarchical linear modeling (HLM), that 26.4% of the total variance in IRI lies between product categories and that 2.7% lies between stores. We identify several factors that mitigate record inaccuracy, such as inventory auditing practices, and several factors that exacerbate record inaccuracy, such as the complexity of the store environment and the distribution structure. Collectively, these covariates explain 67.6% and 69.0% of the variance in IRI across stores and product categories, respectively. Our findings underscore the need to design processes to reduce the occurrence of IRI and highlight factors that can be incorporated into inventory planning tools developed to account for its presence.</description><subject>Applied sciences</subject><subject>Business audits</subject><subject>Business studies</subject><subject>Control systems</subject><subject>Exact sciences and technology</subject><subject>execution</subject><subject>Firm modelling</subject><subject>Industrial accounting</subject><subject>Information technology</subject><subject>Inventories</subject><subject>Inventory</subject><subject>Inventory control</subject><subject>Inventory control, production control. Distribution</subject><subject>Inventory management</subject><subject>Logistics</subject><subject>Management audits</subject><subject>Management science</subject><subject>Mechanical engineering. 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Management science</subject><subject>Product variety</subject><subject>Production management</subject><subject>record inaccuracy</subject><subject>Records management</subject><subject>retail</subject><subject>Retail industry</subject><subject>Retail stores</subject><subject>Retail trade</subject><subject>Retailing</subject><subject>Studies</subject><subject>Supply chain management</subject><subject>Supply chains</subject><subject>Vendors</subject><issn>0025-1909</issn><issn>1526-5501</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2008</creationdate><recordtype>article</recordtype><sourceid>X2L</sourceid><recordid>eNqFkd-L1DAQx4souJ6--iYsgvrUdfI79W05Tl05EESfQzZNd7O0aU26d_S_d2qPU0SUMAlJPjPMd75F8ZzAhlCt3nYxuw0BBRtQunpQrIigshQCyMNiBUBFSSqoHhdPcj4BIKPkqqC7eOPj2Kdp_cW7PtXrXbTOnZN107v1Nq6vuiGk4GyLF9tOOeSnxaPGttk_uzsvim_vr75efiyvP3_YXW6vSycqPpYcxJ5RJqRgIB2nGgSrrCVOEcmtAqhr0JbVWqtaM8qtdFYLsrfg91DJPbsoXi91h9R_P_s8mi5k59vWRt-fs2FSV1wTjuDLP8BTf07YbTaUMKI4ykaoXKCDbb0JselH1Hjw0Sfb9tE3AZ-3RFOJfdKZ3_yFx1X7Lrh_JbjU55x8Y4YUOpsmQ8DMBpnZIDMbZGaDMOHTkpD84N09HWLXp5_ojWFWcNwmDAqg8QgY89OAIakykhNzHDss9upuBjajWU2y0YV8X5Si_UrqeVYvFu6U0fTf_gmlnMhfY5oVpy7_X8SbhT-Gw_E2pGVUc2JnkQwGBXCDnbIfH6TMnQ</recordid><startdate>20080401</startdate><enddate>20080401</enddate><creator>DeHoratius, Nicole</creator><creator>Raman, Ananth</creator><general>INFORMS</general><general>Institute for Operations Research and the Management Sciences</general><scope>IQODW</scope><scope>DKI</scope><scope>X2L</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>8BJ</scope><scope>FQK</scope><scope>JBE</scope></search><sort><creationdate>20080401</creationdate><title>Inventory Record Inaccuracy: An Empirical Analysis</title><author>DeHoratius, Nicole ; Raman, Ananth</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c594t-405b323565306c4280539aa1c7164a700dd08a3d887d8324a6ca851ba0eb096b3</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2008</creationdate><topic>Applied sciences</topic><topic>Business audits</topic><topic>Business studies</topic><topic>Control systems</topic><topic>Exact sciences and technology</topic><topic>execution</topic><topic>Firm modelling</topic><topic>Industrial accounting</topic><topic>Information technology</topic><topic>Inventories</topic><topic>Inventory</topic><topic>Inventory control</topic><topic>Inventory control, production control. Distribution</topic><topic>Inventory management</topic><topic>Logistics</topic><topic>Management audits</topic><topic>Management science</topic><topic>Mechanical engineering. Machine design</topic><topic>Multilevel models</topic><topic>Operational research and scientific management</topic><topic>Operational research. Management science</topic><topic>Product variety</topic><topic>Production management</topic><topic>record inaccuracy</topic><topic>Records management</topic><topic>retail</topic><topic>Retail industry</topic><topic>Retail stores</topic><topic>Retail trade</topic><topic>Retailing</topic><topic>Studies</topic><topic>Supply chain management</topic><topic>Supply chains</topic><topic>Vendors</topic><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>DeHoratius, Nicole</creatorcontrib><creatorcontrib>Raman, Ananth</creatorcontrib><collection>Pascal-Francis</collection><collection>RePEc IDEAS</collection><collection>RePEc</collection><collection>CrossRef</collection><collection>International Bibliography of the Social Sciences (IBSS)</collection><collection>International Bibliography of the Social Sciences</collection><collection>International Bibliography of the Social Sciences</collection><jtitle>Management science</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>DeHoratius, Nicole</au><au>Raman, Ananth</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>Inventory Record Inaccuracy: An Empirical Analysis</atitle><jtitle>Management science</jtitle><date>2008-04-01</date><risdate>2008</risdate><volume>54</volume><issue>4</issue><spage>627</spage><epage>641</epage><pages>627-641</pages><issn>0025-1909</issn><eissn>1526-5501</eissn><coden>MSCIAM</coden><abstract>Traditional inventory models, with a few exceptions, do not account for the existence of inventory record inaccuracy (IRI), and those that do treat IRI as random. This study explores IRI observed both within and across product categories and retail stores. Examining nearly 370,000 inventory records from 37 stores of one retailer, we find 65% to be inaccurate. We characterize the distribution of IRI and show, using hierarchical linear modeling (HLM), that 26.4% of the total variance in IRI lies between product categories and that 2.7% lies between stores. We identify several factors that mitigate record inaccuracy, such as inventory auditing practices, and several factors that exacerbate record inaccuracy, such as the complexity of the store environment and the distribution structure. Collectively, these covariates explain 67.6% and 69.0% of the variance in IRI across stores and product categories, respectively. Our findings underscore the need to design processes to reduce the occurrence of IRI and highlight factors that can be incorporated into inventory planning tools developed to account for its presence.</abstract><cop>Linthicum, MD</cop><pub>INFORMS</pub><doi>10.1287/mnsc.1070.0789</doi><tpages>15</tpages></addata></record> |
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| ispartof | Management science, 2008-04, Vol.54 (4), p.627-641 |
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| source | Jstor Complete Legacy; RePEc; INFORMS PubsOnLine; EBSCOhost Business Source Complete |
| subjects | Applied sciences Business audits Business studies Control systems Exact sciences and technology execution Firm modelling Industrial accounting Information technology Inventories Inventory Inventory control Inventory control, production control. Distribution Inventory management Logistics Management audits Management science Mechanical engineering. Machine design Multilevel models Operational research and scientific management Operational research. Management science Product variety Production management record inaccuracy Records management retail Retail industry Retail stores Retail trade Retailing Studies Supply chain management Supply chains Vendors |
| title | Inventory Record Inaccuracy: An Empirical Analysis |
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