Learning about inventory inaccuracies: A judgment-based inspection and inventory strategy


  • Khader Selma-Afakh
  • Rekik Yacine
  • Botta-Genoulaz Valérie
  • Campagne Jean-Pierre

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It is commonly believed that the information flow always accurately reflects the physical flow of stock. In reality, a discrepancy between the quantity shown by the information system and the physical stock actually available for sales may exist. The paper extends the inventory inaccuracy literature by providing a mechanism permitting to learn about the errors and to judgmentally decide if an inspection of the inventory system is needed to align the physical and information stock levels. Such a judgment-based strategy where the inventory manager decides to perform an inspection or not is compared with a free error strategy. The latter assumes that an advanced identification technology such as the RFID technology is deployed and provides visibility on both the physical and information flows. We deduce analytical results for each strategy and then cross-compare them, which affords us managerial insights on the way to learn about error and the most cost-effective way to tackle the inventory inaccuracy issue. © ILS 2018 - Information Systems, Logistics and Supply Chain, Proceedings. All rights reserved.

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