Written by Cameron Chen, Senior Product Manager, and Adam Baker, Staff Product Manager
Inventory reduction is one of the fastest ways to unlock working capital, yet it remains one of the hardest motions to execute consistently within the inventory management process.
Excess inventory results from thousands of small decisions across parts, BOMs, sites, suppliers, and buyers, often locked into purchase orders, reorder points, and safety stock settings that drift out of sync with actual customer demand and forecast data.
The cost of excess stock is more than just what you paid for the material. It includes the opportunity cost of cash tied up on shelves and the carrying costs of warehousing and handling – all of which could be invested in other areas, like product development, R&D, and employee retention. There are also risks of obsolete inventory, and the hidden time drain of managing low-impact exceptions throughout the supply chain.
Inventory Actions in APEX were built to address these challenges by identifying inventory reduction opportunities and turning them into prioritized, executable work. This helps supply chain inventory managers maintain optimal stock levels and minimize total inventory costs, improving cash flow and operational efficiency.
The real problem: too many exception messages, not enough impact
Most ERP systems generate exception messages, and buyers are expected to work them. The issue is volume and prioritization.
A buyer can easily be faced with thousands of exception messages. And the ERP does not tell them which actions will actually move the needle on inventory reduction or improve inventory turnover. So buyers end up working chronologically, reacting in the moment, or “stumbling into” meaningful opportunities only when they happen to appear in the flow of their day.
Inventory Actions changes that dynamic by doing two things:
- Identifying inventory reduction opportunities that matter
- Ranking them by priority so teams focus on the few actions that drive the majority of the impact on optimal inventory levels and minimize inventory costs
That shift is the difference between activity and measurable improvement in inventory management and supply chain management.
What are Inventory Actions in APEX?
Inventory Actions are APEX-generated recommendations focused on inventory reduction, a key part of effective inventory optimization. They highlight where inventory is likely to be in excess relative to projected need based on demand, order policies, and safety stock - and recommend specific actions to reduce it without creating unnecessary risk to customer satisfaction or production schedules.
In practice, Inventory Actions typically fall into four buckets aligned with inventory management methods and inventory optimization techniques:
- PO actions to reduce inventory
- Move out (push receipts later)
- Split and move out (delay a portion)
- Cancel (when future supply is not needed)
- Min/Max level adjustments
- When replenishment levels are too high based on outdated demand assumptions or historical sales data, APEX recommends resizing levels down to maintain optimal stock levels.
- Reorder point
- When targets no longer match demand behavior, APEX flags the need to adjust the underlying policy so buyers are not stuck repeatedly “fixing” symptoms, helping to optimize reorder points.
- Excess-to-sell (multi-site inventory rebalancing)
- Transfer excess from one site to another site that needs the same material, reducing net inventory and preventing unnecessary new purchases. This leverages multi-echelon inventory optimization to manage inventory data across locations efficiently.
Inventory Actions are often paired with the Shortage Actions feature in APEX, which focus on increasing or accelerating supply to protect against shortages in the production processes. Inventory Actions, by design, are the reduction side of the equation, helping companies minimize inventory costs and improve cash flow while satisfying customer demand.
Proof point: Excess-to-Sell is where “multi-site complexity” turns into savings
Excess-to-sell is one of the most powerful examples of what APEX can do that traditional inventory management software solutions struggle to replicate.
Many manufacturers grow through mergers and acquisitions, resulting in multiple ERPs, different item codes, varied naming conventions, and limited visibility across a company’s inventory network. ERPs often do not communicate effectively, so a site with excess inventory may not realize a sister site is about to experience a shortage of the same stock keeping unit (SKU).
APEX solves this challenge with a data harmonization layer that normalizes inventory data across systems and sites, then flags opportunities to reallocate inventory across the supply chain network.
The result is a practical, high-value outcome:
- One site offloads raw materials or finished goods it does not need
- Another site avoids a stockout, or cancels/avoids a new purchase order (PO)
- The business reduces working capital tied up in excess inventory and minimizes total inventory costs
This inventory reduction strategy protects service levels while improving cash flow and operational efficiency, demonstrating the benefits of inventory optimization efforts without creating risk to customer satisfaction.
Why prioritization matters more than finding “more actions”
Most inventory management systems can generate recommendations, but the real challenge lies in making those recommendations usable at scale.
Inventory Actions are designed around the reality of buyer capacity and the constraints of manual processes:
- Buyers have limited time each day for inventory reduction work.
- Administrators can configure prioritization to align with organizational goals and inventory strategies.
- Teams can focus on the “top 10 most impactful actions” instead of drowning in thousands of exception messages.
This targeted approach enables effective inventory control and supports achieving inventory optimization by focusing efforts where they will reduce excess inventory and minimize total inventory costs.
By prioritizing actions that improve inventory turnover ratio and maintain optimal stock levels, inventory managers can better meet customer demand while improving cash flow and operational efficiency.
This is where the return on investment (ROI) becomes repeatable. You are not relying on heroic effort; you are building a daily system that consistently targets the highest-impact opportunities.
Built for the people who actually have to execute
Inventory Actions are primarily used by buyers and materials managers, but they are designed to extend beyond PO changes to support effective inventory management capabilities.
- Buyers execute most purchase order (PO)-related actions such as move outs, splits, and cancels, directly impacting inventory reduction and helping maintain optimal stock levels.
- Analysts often own policy-level changes, including adjustments to reorder points and Min/Max resizing, which are crucial for accurate demand forecasting and inventory optimization solutions. Inventory Actions can be reassigned or escalated as tasks when the right owner is not the buyer.
- Supervisors and leaders use the signals generated by Inventory Actions to monitor execution, identify patterns of “unable to fix” that may indicate data analysis needs or supply chain disruptions, and ensure alignment with inventory strategies.
This collaborative approach ensures that inventory managers can accurately predict future inventory needs, minimize total inventory costs, and improve cash flow, all while meeting customer demand efficiently.
This is consistent with what APEX’s Workbench offers: prioritized actions, structured workflows, and measurable execution that integrates with enterprise resource planning systems to support successful inventory optimization efforts.
Inventory Actions in Workbench: from recommendation to execution
Identifying an inventory reduction opportunity is only half the job. The other half is executing it efficiently, without time-consuming swivel-chair work.
That is why PO-based Inventory Actions are directly accessible through Workbench, APEX’s execution environment designed to streamline procurement workflows and enhance inventory tracking and materials management. Workbench centralizes buyer tasks, supplier collaboration, and the operational steps needed to act on inventory optimization recommendations.
In practice, Workbench changes the day-to-day workflow:
Without Workbench
- A buyer surfaces an exception message in the ERP or a report.
- They reach out to the supplier by email or phone.
- They wait for a response, sometimes days.
- They manually update the ERP once an agreement is reached.
- They later check to confirm the change was applied correctly.
This process is slow, fragmented, and prone to error, hindering effective inventory control and increasing total inventory costs. It breaks down quickly at scale and forces buyers to spend time coordinating work instead of focusing on achieving optimal inventory levels and improving cash flow.
With Workbench
- A buyer opens a prioritized list of PO adjustments.
- They review recommendations and send requests directly from APEX.
- Suppliers respond in APEX (approve, reject, or counter).
- The buyer stays in one system, working from one queue, with full traceability.
Workbench turns inventory reduction into a repeatable operating motion, leveraging inventory optimization software to minimize inventory costs and reduce excess stock efficiently, not a one-off effort that depends on emails, follow-ups, and manual updates.
ERP write-back: removing the last mile of manual work
Even with great prioritization, inventory managers and buyers lose hours to duplicate data entry and manual updates within their inventory management system.
With APEX's new ERP write-back feature, Workbench becomes more than a workflow layer; it acts as a seamless integration that pushes approved purchase order changes directly into the ERP. This automation streamlines the inventory management process by reducing manual intervention and improving accuracy.
This capability eliminates two of the biggest bottlenecks in inventory control and inventory optimization efforts:
- Synchronous supplier back-and-forth communication that delays execution and increases the risk of lost sales
- Manual ERP updates that create errors, rework, and cause lag in reflecting accurate inventory levels
With ERP write-back enabled, the buyer effectively “pre-approves” the request by sending it to the supplier. When the supplier accepts, the change is written to the ERP automatically, with status indicators in APEX that show what is pending and what has synced successfully.
By integrating ERP write-back with your inventory optimization software, companies can better maintain optimal stock levels, reduce excess inventory, and improve cash flow.
This is how inventory reduction starts to scale—not by asking buyers to work harder, but by removing redundant steps entirely and enhancing operational efficiency through connected business processes.
Trust and explainability: inventory reduction has to feel safe
Inventory reduction is a critical aspect of inventory management, but it is not neutral in manufacturing environments. Many buyers have experienced the consequences of shortages firsthand. If inventory levels drop too low, production halts; if inventory is too high, there is pressure to reduce carrying costs. These stakes make inventory reduction decisions feel career-defining for many.
Therefore, adopting inventory optimization tools like Inventory Actions depends heavily on trust.
Inventory Actions build trust in two key ways:
- Alignment to Known ERP Action Types
Many recommendations correspond directly to familiar ERP messages such as canceling or rescheduling orders. APEX does not invent new workflows but prioritizes recommended actions based on your organization's goals, historical data, and current inventory levels from your ERP system. - Explainability as Part of Execution
As Workbench evolves, it not only shows the recommended inventory reduction action but will also explain why it matters, why it is prioritized, and how accepting it will impact inventory costs, safety stock, and overall supply chain management. This transparency helps inventory managers move from questioning the system to using it as a standard part of inventory control and optimization.
By fostering trust and explainability, Inventory Actions support effective inventory reduction while maintaining optimal stock levels to meet customer demand and avoid costly stockouts.
How Inventory Actions work with APEX Inventory Optimization
Inventory Actions focus on current-state execution by targeting excess inventory that exists today and cleaning up near-term supply decisions. This approach helps reduce carrying costs and frees up working capital tied in excess stock.
In contrast, APEX Inventory Optimization addresses future-state strategy by right-sizing order policies, safety stock, and reorder points to maintain optimal inventory levels and prevent excess inventory from recurring. This includes adjusting safety stock based on accurate forecast demand, ensuring that inventory levels align with actual customer demand and market trends.
When order policies and safety stock settings are misaligned, inventory managers and buyers often get pulled into constant cleanup efforts. They may receive conflicting signals, such as moving a purchase order (PO) out today, while the real fix involves updating policies so that the PO never gets placed again. This cycle increases total inventory costs and can lead to too much inventory or stockouts.
The best long-term approach combines both methods:
- Use Inventory Actions to capture immediate inventory reduction opportunities and reduce excess stock.
- Use Inventory Optimization to reset underlying policies, including economic order quantity (EOQ), just in time (JIT) inventory practices, and vendor managed inventory (VMI), to prevent recurrence and maintain optimal stock levels.
By integrating these strategies, manufacturers move from reactive problem-solving to proactive inventory strategy, improving inventory turnover ratio, minimizing inventory costs, and enhancing customer satisfaction through better inventory control and inventory forecasting.
Getting started: the simplest path to adoption
To help new buyers, inventory managers, and materials managers build trust and realize value quickly, begin with the most straightforward execution steps:
- Use Workbench within the purchase order (PO) adjustment workflow for efficient inventory tracking and control.
- Filter recommendations specifically to inventory reduction actions such as move outs, cancels, splits, and reductions to focus on minimizing excess inventory and carrying costs.
- Work through the prioritized list daily, gradually expanding into additional action types as the team gains experience and confidence in managing inventory levels.
This focused adoption approach fosters a repeatable habit that drives measurable inventory improvement, helping maintain optimal stock levels and aligning inventory strategies with actual customer demand and forecast data.
The bottom line: inventory reduction that is operational, not aspirational
Inventory reduction is not won in spreadsheets or manual processes; it is achieved through consistent daily execution supported by efficient workflows within materials and inventory management systems.
Inventory Actions in APEX help manufacturers:
- Free working capital tied up in excess inventory and reduce inventory costs
- Lower carrying costs and minimize risks of obsolete inventory
- Prioritize the few actions that drive real impact on inventory turnover and maintain optimal stock levels
- Execute faster through Workbench workflows integrated with ERP write-back for seamless inventory tracking
- Eliminate duplicate effort and errors, improving accuracy of physical inventory data
- Build trust through clarity, traceability, and explainability in inventory control
If your buyers are overwhelmed by exception messages and your business carries excess “just in case” stock, the issue is not effort but the lack of a system that turns inventory reduction opportunities into prioritized, executable work aligned with accurate demand forecasting and sales patterns.
Inventory Actions is that system, helping you meet customer demand while optimizing inventory levels and improving cash flow.
