Decoupling Inventory

 Within a manufacturing process, decoupling inventory means separating inventory so that the inventory associated with one stage of a production process does not slow down other parts of the process. In simple terms, inventory decoupling is a sort of security inventory. It offers a safety net to  the possibility of a full production halt if there is no supply of one or more components of a product.

Mass production companies are vulnerable to many tricky areas, which can bring the production line to a halt. Such setbacks stem from both inside and outside the group. The entire ecosystem is affected when a particular element of the chain stops working as per the production plan. Under such conditions, there is a cushioning effect of having excess stock of unfinished goods at each point of the production cycle. While the troubleshooting is completed, the facility will continue to offer the same performance. Without needing the previous one to produce, the next station will proceed with the periodic output.

If the company uses the same components in a multiple product mix, having such an arrangement is essential. As a consequence, although less urgent work is stopped, they will redirect production to meet the main orders. This will help deal with the demand so that, because of such challenges, the business does not sustain losses. Here, the focus is put on preventing time loss.

Inventory of decoupling works not only against internal weaknesses but also against external causes as a cushion. If a business retains decoupling stock, increases in demand, suppliers unable to supply the supply, or any change in the delivery schedule will be in a better position to face.

The advantages of keeping decoupled stock are the following:

• It protects the business and production facility from any difficulties at the end of the suppliers.
• If there is some failure at any point of manufacturing or equipment, it ensures that production continues.
• If the employees responsible for some process or machine are on leave or go on strike, this inventory will also help the company sustain its production.
• This additional inventory allows the business more time to fix and overcome the process.

So, we now understand that it is very important to establish a decoupling inventory for a manufacturing problem with different stages in its production cycle. However, it is also difficult to determine the correct amount of decoupling stock, as with any other inventory process. However, the task of evaluating the decoupling stock becomes relatively simpler if the organization has a proper inventory management system.