Reducing unnecessary stock genuinely improves operations and working capital. According to Navigating Supply Chain Challenges by Dr. Uppiliappan Gopalan, that is exactly why so many organisations keep reducing it, one sensible decision at a time, until the buffer that once protected them has quietly disappeared.
Each Decision Is Supported by the One Before It
A supplier delivers reliably, so the organisation gives it more business. A factory maintains output, so utilisation increases. Inventory remains available whenever required, so planners reduce the buffer again. Nothing about this pattern is careless, Dr. Gopalan writes. It represents disciplined management under conditions that have remained broadly stable.
The Space That Quietly Disappears
Over time, secondary suppliers receive little regular volume and gradually lose familiarity with the product. Alternative routes remain visible on a map, although documentation and carrier arrangements are left untested. Efficiency continues improving while recovery space becomes smaller.
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