Spreadsheets to Teach the (RP,Q) Model in an Inventory Management Course - Pre-designed Spreadsheet to Explain Decision Rule Based on Units Service Level (USL)

Sep 12, 2026

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The paper explains how a pre-designed spreadsheet can support learning in an Inventory Management course by teaching the (RP,Q) continuous review model. It focuses on using a decision rule derived from the Units Service Level (USL), linking inventory control theory with hands-on computation. The approach targets common course goals in operations management by helping students understand model foundations, apply technical parameter calculations, run simulations, and interpret performance measures using Excel formulations and results.

LanguageEnglish

CategoryPresentations

FormatPDF

Pages10

Reading Time4 min

AccessFree to download

Introduction

Background and importance of inventory management

Learning objectives in inventory management courses

Role of spreadsheets in Operations Management & Logistics

Inventory Management Overview

Inventory management and control responsibilities

(RP,Q) Model Teaching Approach (USL-based)

Spreadsheets to teach the (RP,Q) model in an Inventory Management Course Carlos A. Castro-Zuluaga ([ccastro@eafit.edu.co](ccastro@eafit.edu.co)) Production Engineering Department, Universidad Eafit Medellin-Colombia Abstract The use of spreadsheets to support learning processes has become a common practice used by teachers in Operations Management courses. This paper shows a predesigned spreadsheet used inan Inventory Management course to explain the model (RP,Q) using the decision rule based in the Units Service Level (USL) . Keywords: Inventory Management, Learning Processes, Education, Spreadsheets Introduction In recent years, inventory management and control at enterprises has become an important area that requires a higher attention by directors and managers. For one hand a suitable management of inventories can drive toward competitive advantages as cost reduction, improving the service levels, fast and reliable deliveries, and/or increase the flexibility of the business (Ketchen, 2008) .On the other hand, inventories are current assets, which according with some studies represent on average 25% of GDP (Gross Domestic Product) of a country, and thereof about 50% are from logistics costs (Silver et al, 1998, Rey, 2008) . The process of the management and control of the inventories at any company, no matters if these are in the manufacturing or in the service sector, have the responsibility to give answer of three issues or problems: 1) how often the status of the inventory should be revised; 2) when an order should be placed and 3) how much should be ordered (Silver et al, 1998) . These three questions must be faced in a regular basis for many industrial and production engineers, when they work at professional level as inventories coordinators, vendor management, production managers or plant directors (only to mention some roles in the companies) not matter if the company has a commercial information system (as SAP, Oracle or Dynamics) or if it is a customized information system or ifit was developed at home, because in any case the definition of the control policy, the selection of the models and mainly, the technical calculations of its parameters, are the core of the inventory management (Shehab, 2004; Moon, 2007; Gutierrez, 2009) . In order that future professionals can achieve with higher probability of success the objectives and goals in the inventory area at the companies they will work, it is important that in the inventory management courses (at undergraduate and graduate levels) the students can develop the competences that they will need to cope adequately the challenges that it implies. It can be accomplished with an appropriate teaching of subjects mentioned above related with inventory management and control, which begins with a deep understanding of the basis and foundations of the topic, that will allow to comprise, analyze, interpret, develop, implement and measure the performance of the inventory management models in a company. Spreadsheets have been used for years in teaching and training students in many areas of knowledge, including a wide variety of subjects related to Operations Managements and Logistics (OM&L) because with them is easy to represent, model and analyze many administrative situations, that can support the decision making process at different levels into a company (Baker, 2003) . Some topics that were found in literature related to the OM&L teaching and training included control quality and statistical process control (Rajalingham, 2000), forecasting of demand (Dawood, 1995; Segura, 2001, Castro, 2012), management and analysis of supply chain management (Chwif, 2002) and simulation (Evans, 2000), just for mention only some of the huge quantity of spreadsheets developed with educational purposes. One of the most practical ways to teach the inventory management models, including parameters definition, sensibility analysis, policies simulations, etc., it is

FAQs

What inventory model does the paper focus on for teaching?

The paper focuses on the continuous review inventory model known as reorder point, fixed quantity (RP,Q).

How is the decision rule for the spreadsheet defined?

The decision rule is based on the Units Service Level (USL) or fill rate.

What is the purpose of using Excel spreadsheets in the course?

The spreadsheets help bridge theory and practice by enabling students to compute model parameters, run simulations, and verify results with Excel formulations.

Sep 12, 2026

Upload by Gloria