What is Digital Inventory Management?

Digital inventory management refers to the use of digital technology to monitor, manage, and optimize the flow of spare parts, raw materials, tools, and other critical stock into your facilities. This type of technology supplants the need for manual inventory methods such as paper records and spreadsheets, replacing these with user-friendly digital interfacing, real-time visibility into inventory data, and advanced analytics aimed at optimizing your inventory management strategy.

While the advantages of digital inventory management are difficult to dispute, the transition from the old way of doing things may still require your business to overcome a few practical hurdles. You’ll need to take steps to ensure that you have the proper systems in place for implementation, that your personnel are ready to adopt the new technology, and that you have a plan for onboarding your data.

Why is digital inventory management important?

While manual inventory methods may be familiar, they are also highly vulnerable to inaccuracy and inefficiency. From the risks of human error and accessibility limitations to the absence of real-time data and advanced analytics, manual inventory management is a recipe for chaos. 

Indeed, even just the occasional data discrepancy can cascade into a series of mishaps and operational failures. The most reliable human operators on your team can still make occasional data entry errors. These errors can lead to inventory miscounts, which can precipitate spare part stockouts, which can snowball into equipment failure, prolonged downtime, diminished productivity, and missed delivery deadlines. 

In other words, relying on manual inventory management is an open invitation to operational disarray. By contrast, transitioning to a digital inventory management strategy can help automate and streamline numerous aspects of your inventory supply chain while reducing errors, improving organization-wide data access, and enabling data-driven decision making.

Transitioning from manual to digital inventory processes

As your business approaches the transition from manual to digital inventory management, you will likely follow a process like this:

  1. Assess your current inventory processes to identify inefficiencies, inaccuracies, and areas for improvement. 
  2. Find a digital inventory management system that addresses the needs identified in the step above. As you search for the right system, prioritize a solution that is scalable, compatible with your existing systems, user-friendly, and cost-effective. 
  3. Prepare to migrate inventory data from the manual system into the digital platform, taking the time to pinpoint inaccuracies, remove duplicate records, and validate all data inputs before entering them into your new system.
  4. Train employees on effective use of new digital inventory systems including aspects like data entry, reordering, and warehousing.
  5. Integrate the digital inventory management system with other digital tools and systems used by your organization, such as accounting software or ERP (Enterprise Resource Planning) systems.

In addition to taking these preparatory steps, your organization should have certain operational features in place as well. Below, we identify the most basic elements that your organization must have in place to facilitate implementation.

Basic considerations for implementing digital inventory management

At the most basic level, implementing digital inventory management entails:

  • Selecting software that fits your business’s scale, industry, and inventory needs
  • Ensuring the necessary hardware (e.g., barcode scanners, tablets, servers) and infrastructure (e.g., internet connectivity, network security) are in place to support a digital system
  • Organizing inventory data in a way that is compatible with both your physical storage strategy and your new digital system
  • Revising current inventory procedures according to the capabilities of your new digital system
  • Leveraging the reporting and analytics capabilities of the digital system to gain advanced insights into inventory levels, turnover rates, and supply chain performance

Additional manual inventory management challenges

Manual inventory management is inherently vulnerable to error and inefficiency. Below, we take a closer look at the heightened risks your operation faces by choosing the traditional approach over a digital inventory management solution

Human Error

From simple miscounts during stock audits to data entry mistakes when logging inventory movements in spreadsheets, human errors can compound over time. Over a long enough duration, these errors can lead to significant discrepancies between physical stock levels and recorded inventory data. This, in turn, can lead to stockouts, overstocking, accounting discrepancies, and even compliance failures.

Operational Inefficiency

Manual inventory management is inherently time-consuming. Organizations that use manual inventory management strategies must dedicate a considerable amount of human power and time to tracking inventory movements, performing physical stock counts, generating reports, and deriving insights from these reports. But this type of inefficiency is more than just time-consuming. It also consumes energy, labor, and resources that could be better spent in other areas of the operation.

Lag Time

Manual inventory management lacks the real-time visibility provided by digital inventory systems. For instance, with manual systems, there is an inevitable lag between the time when a transaction occurs and the time the data is recorded. This delay can lead to decision-making based on outdated information, which can stand in the way of making timely replenishment orders, effectively forecasting future demand, and achieving overall inventory optimization

Limited Accessibility

Not only is there likely to be a lag time on the availability of data, but you will likely also face practical obstacles in making the data available to all team members. Manual inventory management relies on physical formats or localized digital spreadsheets for the logging and storage of information.This approach inevitably limits the ability of team members throughout your organization to view and act on inventory data. This, in turn, limits the capacity of your team to make decisions that are informed by complete and up-to-date inventory levels. 

Poor Data Analysis

Using a manual inventory management strategy deprives your organization of valuable data that could be leveraged to make more informed inventory decisions. Manual inventory models simply don’t have the capacity for sophisticated data analysis, demand forecasting, or comprehensive reporting. This may place your business at a strategic disadvantage as competitors adopt digital inventory management systems and make use of the advanced analytical functions that these solutions typically provide. 

Benefits of digital inventory management

Digital inventory management systems offer transformative solutions to the challenges described in the section above. Not only do today’s advanced inventory management systems address the drawbacks of manual inventory management, but they offer businesses access to new heights of operational efficiency.

Below, we take a closer look at exactly how digital inventory management systems are allowing businesses to manage inventory with greater efficiency, accuracy, and cost-effectiveness. 

Enhanced Accuracy

Digital inventory management systems automate inventory tracking, movements, and transactions, using barcode scanning and automated data entry to ensure that stock counts, spare parts usage, sales, purchases, and returns are accurately recorded in real-time

Real-Time Visibility

Digital inventory systems provide real-time visibility into inventory levels across multiple locations so businesses can instantly access current stock level information, track item movements, and monitor trends throughout their facilities. 

Increased Efficiency

Digital inventory management systems can automate routine tasks such as data entry, stock level monitoring, and report generation, freeing up valuable time for your personnel to focus on  higher level tasks and strategic imperatives. 

Improved Scalability

When you digitize your inventory systems, you gain the ability to handle increasing volumes of transactions and a broader range of products. You may also be able to expand into new markets, new geographical locations, and more diverse supplier relationships without the complexity and resource allocation required of a manual inventory system. Digital management solutions give your business the ability to shift the inventory gears upward or downward based on conditions like seasonality, project completion, and macroeconomic change.

Advanced Data Analysis

Digital inventory management systems place sophisticated data analytics capabilities at your fingertips. The best platforms also provide you with the tools to translate that inventory data into actionable insights. Your digital inventory management solution should give you the power to leverage detailed reports, identify sales trends, forecast demand, optimize stock levels, and make data-driven decisions about purchasing and production. 

Expanded Accessibility

Cloud-based digital inventory management solutions and mobile inventory management apps make it possible for your maintenance team and other personnel to access inventory data from anywhere, at any time. This gives your maintenance team the ability to check stock levels, place orders, review inventory reports, and contribute to work orders from the field.

The impact of adapting a digital inventory management program may be particularly consequential for your maintenance team, which will benefit from a more predictable inventory control outlook, a dramatically reduced workload, and the infrastructure for implementing a truly preventive maintenance strategy.

Digital inventory management: use cases

Business leaders are making the transition to digital inventory management systems across a wide variety of industries. Below, we take a quick look at how different industries are taking advantage of the rapid advances in digital inventory management solutions today:


Digital inventory management allows retail business operators to track product availability across multiple channels and locations in real time; to ensure stock levels are adequate to meet customer demand; and to automate reordering triggers based on predefined stock thresholds.


Digital inventory management software gives manufacturing operators the ability to track the use of raw materials, spare parts and maintenance tools, while coordinating this usage with both preventive maintenance tasks and inventory reorder levels.


Digital inventory management makes it possible to coordinate complicated supply chain logistics, tracking the movement of goods across multiple locations and stages of the supply chain with real-time visibility.


Digital inventory management makes it possible to track the usage and movement of tools, equipment, and materials across job sites, preventing project delays and ensuring that the necessary materials are available in the right quantities and as needed

Implementing a digital inventory management system

As you transition from manual inventory management to digital inventory management, you may want to follow the process outlined below:

Step 1: Define Your Goals

Identify pain points in your current system, such as inaccuracies, inefficiencies, or lack of real-time visibility, and set clear objectives for how your digital inventory management system will resolve these problems. 

Step 2: Research Software Options 

Look for features that address your industry’s unique challenges, evaluate integration capabilities, and choose a system that offers robust customer support.

Step 3: Plan Your Implementation Strategy

Assemble a project team with representatives from key departments, develop an implementation timeline, and begin the process of organizing, cleaning, and prepping your data for migration.

Step 4: Train Your Team

Provide comprehensive training to ensure all team members understand how to use the new system, and support training with effective guides, video instruction, and other training materials.

Step 5: Migrate Your Data 

Transfer your inventory data to the new system and connect your new digital inventory management system with your existing business software platforms (i.e. ERP, CRM, POS, etc.) to facilitate interoperability, data sharing, and workflow integration.

Digital inventory management with Limble

Transitioning to digital inventory management can be a game-changer for your business. Limble CMMS (Computerized Maintenance Management System) offers a robust platform that simplifies this transition by placing an emphasis on ease of implementation. Likewise, Limble’s asset management capabilities are specifically designed to reduce the complexity involved in managing inventory.

Limble’s Asset Management features allow you to

  • Organize physical asset records in a searchable hierarchy structure
  • Create custom fields to track specific parts, components, and materials related to each asset
  • Print QR codes to quickly lookup assets, track movements, or start work
  • View asset cards with essential information like WOs, PM schedules and tasks, parts, reports, and more in a single location.
  • Integrate your asset management and inventory solutions with ERP systems or other digital business tools

Simply stated, Limble’s digital inventory management solution is an invaluable tool for organizations looking to modernize their inventory management practices. By easing the process of digital transformation, Limble CMMS clears the pathway for businesses seeking inventory optimization, cost savings, and greater overall operational efficiency.  

Find out what Limble’s Asset Management capabilities can do for your business and request a demo today!

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