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Revenue Generation RRL

This document discusses how inventory management and the use of information technology can improve revenue generation and financial performance for businesses. It reviews literature showing that better inventory management through reduced levels and higher inventory turns is associated with better financial results. The use of IT in inventory control systems, lead times, and practices can enhance timely deliveries, reduce costs, and increase quality, sales, and profitability. Investing more in IT helps optimize business processes, lower expenses, improve efficiency, and boost information sharing - leading to increased revenue growth.

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Wyler Aki
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222 views3 pages

Revenue Generation RRL

This document discusses how inventory management and the use of information technology can improve revenue generation and financial performance for businesses. It reviews literature showing that better inventory management through reduced levels and higher inventory turns is associated with better financial results. The use of IT in inventory control systems, lead times, and practices can enhance timely deliveries, reduce costs, and increase quality, sales, and profitability. Investing more in IT helps optimize business processes, lower expenses, improve efficiency, and boost information sharing - leading to increased revenue growth.

Uploaded by

Wyler Aki
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Review of Related Literature

Revenue Generation

With the rise of information technology, many businesses are

in a state of emergency on how will they cope with the gaps

brought by it. The use of information technology on inventory

management has proven to be of great competitive advantage to

businesses especially on the generation of revenue. Researchers

generally agree that excess inventories at the firm level

indicate supply-demand mismatch and are frequently associated

with poor operational performance (Singhal, 2005; Fisher, 1997).

Inventory-related costs such as carrying, material handling,

obsolescence, and insurance undermine profit margins and lower

stock price (Singhal, 2005; see Calloni et al. 2005 for a

comprehensive discussion on various inventory-driven costs).

Thus, better inventory performance (typically operationalized as

higher inventory turns or reduced inventory levels) is frequently

associated with better financial performance at the firm level.

According to the study of Naliaka and Namusonge (2015), they have

concluded that the utilization of inventory management has

affected inventory control systems, inventory lead time, and

inventory control practices in terms of enhanced timely

deliveries, reduced production costs, increased product quality,

decreased production cycle time, reduced wastages, reduced stock


levels, reduced material costs, increased customer satisfaction,

reduced obsolescence, and surplus, increase sales and reduced

inventories, and increased profitability.

To further support the claims, Kithinji (2015) stressed that

companies should invest more in information technologies in order

to achieve proper flow on business processes, minimize and reduce

costs, enhanced efficiency, and increase sharing of information

which will lead to improved performance affecting factors that

are related to revenue growth.

Definition of Terms x Bibliography

Revenue Generation. Revenue generation is one of the most

important activities any business can engage in. It is defined as

a process by which a company plans how to market and sell its

products or services, in order to generate income.

Cost Reduction. Cost reduction is to be understood as the

achievement of real and permanent reduction in the unit cost of

goods manufactured or services rendered without impairing their

suitability for the use intended or diminution in the quality of

the product.
Frost, D. (2021, August 31). What is revenue generation? Cognism.

https://www.cognism.com/revenue-generation

Singh, S. (2016, June 18). Cost Reduction: Meaning, Essentials

and Techniques. Learn Accounting: Notes, Procedures,

Problems and Solutions.

https://www.accountingnotes.net/cost-accounting/cost-

reduction/cost-reduction-meaning-essentials-and-

techniques/6343

V.W., N. (2015, June 20). Role of Inventory Management on

Competitive Advantage among Manufacturing Firms in Kenya: A

Case Study of Unga Group Limited. Hrmars.

https://hrmars.com/papers/detail/IJARBSS/1595/Role-of-

Inventory-Management-on-Competitive-Advantage-among-

Manufacturing-Firms-in-Kenya-A-Case-Study-of-Unga-Group-

Limited

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