Reduction of inventory discrepancies due incorrect bill of material in an electrical manufacturer

Abstract

In the company EM, during the last inventory (2020), a lost cost of over US$100,000 was calculated due to incorrect bill of material or discrepancies related to deviations not implemented. This paper focuses on finding the optimal follow-up system to prevent inventory discrepancies due to bill of material errors and on managing future issues related to this subject. The technique followed was the Waterfall Methodology, for which the management expressed the need of a project where the items flagged during the inventory were reduced. During the implementation of the project, the data was divided by deliverables, focusing on vendor lead times and usage of the parts. Four deliverables were completed and, as a result, 500 items were reviewed and 25 projects started, which should be concluded during 2021. Key Terms ⎯ Bill of material, inventory discrepancies, inventory inaccuracy, supply chain