Impact of the Operations Manager's dual role on inventory policy

José Alfaro () and Josep Tribó

DEE - Working Papers. Business Economics. WB from Universidad Carlos III de Madrid. Departamento de Economía de la Empresa

Abstract: In modern corporations, the Operations Manager’s role in defining of firm’s strategy is becoming more important. In this paper we describe how firms can use this tendency for Operations Managers to make strategic decisions as a mechanism to prevent inventory mismanagement. These managers have incentives to speculate with inventory cost reductions, thereby avoiding sharp reductions in a single period, because it would hinder further reductions in the future. Remarkably, firms may prevent such behavior by stimulating the Operations Managers’ strategic orientation, without losing sight of inventory-efficient management.

Keywords: Operations; Manager; behavior; Compensation; model; Inventory; policy (search for similar items in EconPapers)
Date: 2007-09
New Economics Papers: this item is included in nep-bec
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Persistent link: https://EconPapers.repec.org/RePEc:cte:wbrepe:wb076612

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