Primer on Inventory Management

Fundamental models and their application

Objective  The objective of this primer is to provide the fundamental theory of inventory management in  a self-study guide. The intention of the primer is not to replace textbooks or basic lectures of inventory management, but to allow people to freshen up and deepen their knowledge of inventory management, as well as to understand how the inventory models link to demand forecasting, and how they can be applied in practice.

Rationale  My Master course on Supply Chain Operations triggered the development of the primer. In the course, I heavily rely on inventory management models. During the first three lectures, I used to cover the fundamental models that are contained in the primer. Because our students have quite diverse backgrounds, they require different teaching speeds. For those with little prior exposure to inventory management, the sessions progressed too quickly and those students got lost. For those with extensive prior exposure to inventory management, the sessions progressed too slowly and those students got bored.

Contents  I have created this primer on inventory management to allow students to learn the fundamental models of inventory management at an individual speed. I cover the inventory models that I rely on in my course on Supply Chain Operations  and that I and many of my colleagues consider essential. So, I will not cover all inventory models that exist, but a selection that covers the fundamental issues.

Learning Approach  As Confucius already stated more than 2000 years ago, one learns by doing. Therefore, I have created relatively short videos on each topic and provide extensive exercises. I expect students to spend ¼ to ½ of an hour watching a video of a session and one to three hours solving the exercises of a session.

Project  At the end for the primer, I provide a project, in which various models are applied in settings that are typical in practice. Some parts of the project are quite challenging, while others are basic. I expect students to spend ten to fifteen hours on the project. So, the total time that a student spends on this primer is between 20 and 30 hours.       

I hope that you will enjoy this primer and that it will be fun solving the exercises and the project!

Ulrich Thonemann