ERP
In most companies the year-end count is a ceremony: the warehouse closes, the team counts, the variance goes into a report. The real problem is not that day — it is the eleven months in between.
Decisions made on a guess
When the stock figure does not reflect reality, purchasing orders on a guess, production promises on a guess, and sales quotes a delivery date on a guess. The variance that shows up on counting day is the bill for dozens of decisions already made.
How cycle counting works
- Fast-moving items are counted often, slow ones rarely
- Counting does not stop the work — it moves a few shelves at a time
- When a variance appears, the reason is still remembered; three months later it is not
What is worth measuring
The value of the variance on its own is not a useful measure. How many items were off, which process the difference came from, and whether it repeats — that is the data to look at. If the system keeps it, counting stops being a penalty and becomes a correction tool.