Inventory and transportation management

Inventory and Transportation Management
Name
Institution
Inventory and Transportation Management
Q1
Inventory carrying cost represents the amount of money it costs when holding the inventory in storage, which is not moving (Stevenson, Hojati, & Cao, 2007). The amount involves what is spent through storage, maintaining, and management of the inventory using the facilities within the house or a warehouse from outside. Both the process and management of stock incur the cost that occurs through using equipment for handling material, applying software and hardware, and electricity among others extensively. On the other hand, ordering cost refers to the amount of money that is needed or spent when inventory or product is ordered and taken to the ordering company (Stevenson, Hojati, & Cao, 2007). Parts of the ordering cost are the inbound logistics and procurement cost. When it comes to ordering cost, unlike in the inventory carrying, two factors are essential, the cost involved in making too less order and then in excess ordering. When excess quantity is ordered, then there is the likelihood that it will result in inventory carrying cost due to the big sum of money to be spent in storage.
Q2
The development of the various information technology tools has supported the transportation evaluation through planning, execution, and performance. In general form, the tools make up the transportation management systems to allow the goods to move across the supply chain. At the transportation planning, the management systems assist scheduling, routing and load planning.

For schedule and routing, the delivery time and the routes are determined thus impacting performance supply chain and customer satisfaction (Asari, Kaneshiro, & Hosoda, 2005). Load planning allows deliveries that are safe, effective, and efficient. For transportation execution, load tendering identifies the best carrier for the freight while appointment scheduling enables automation of programming. Finally, the score-carding and performance reporting assist in the analysis where the performance of transport is managed. IT tools make data collection, measurement, and report dissemination processes automatic.
References
Asari, S., Kaneshiro, T., & Hosoda, T. (2005). U.S. Patent No. 6,975,248. Washington, DC: U.S. Patent and Trademark Office.
Stevenson, W. J., Hojati, M., & Cao, J. (2007). Operations management (Vol. 8). Boston: McGraw-Hill/Irwin.