15.3 Consulting in commercial enterprises

In commercial enterprises, stock turnover is one of the key issues. In a well-run firm this forms the focal point of all activities; purchasing and stock level planning are based on stock rotation objectives. The consultant’s first task in such enterprises should be to check the stock (inventory) control procedures. If these are found to be unsatisfactory, suitable procedures will have to be established. Different types of goods need different stock-control systems, and seasonal sales fluctuations (e.g. Christmas, beginning of school year, etc.) must be anticipated in inventory planning.

The establishment of stock-control procedures comes first, because further work will need the data such procedures will produce. Indeed, very often the assignment aims to achieve no more than the installation of good stock-control procedures and the training of management in using stock-control data for planning and administration. In recent years the concept of just-in-time inventory management has become very popular. It allows a business to keep inventory levels at a minimum while reducing the risks of running out of stock.

Some assignments, however, will also have various general management aspects (e.g. setting up management-by-objectives (MBO) programmes in multidepartment firms), and sometimes training in specialized techniques will have to be arranged.

The above account for the bulk of what might be called corrective or remedial consulting activities in commercial enterprises. Some firms, however, get themselves into more serious trouble through unsound policies. In these cases the remedies are usually obvious, if drastic, and the consultant’s main function is to provide management with the support needed to make disagreeable or unpalatable decisions.