Sometimes things that seem factual are not exactly true. Here are a few examples relating to inventory:

• When I was a materials manager, the auditors would declare that we had taken a “good inventory” at year-end when the amount of positive variances was counterbalanced by an equal amount of negative variances. The economic definition of “optimize” was at play here with the intent to meet budget. From the standpoint of profits and taxes, the statement was correct—but still not a good thing. Why celebrate the fact that you have too many of some parts and too few of others?

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