True or False: Effective inventory management is important for ensuring the supply function's success.

Effective inventory management is crucial for the success of the supply function because it directly impacts the overall efficiency of the supply chain. Proper inventory management ensures that the right quantity of products is available at the right time and place, which helps to meet customer demand without overstocking or understocking. By maintaining optimal inventory levels, organizations can reduce holding costs, minimize waste, and improve cash flow.

In addition to supporting operational efficiency, effective inventory management plays a role in enhancing supplier relationships and negotiation leverage. When a company manages its inventory well, it can forecast demand more accurately, leading to better collaboration with suppliers and more favorable contract terms. This ultimately contributes to a more resilient supply chain capable of adapting to market fluctuations.

While the significance of inventory management can vary across industries, it remains a fundamental aspect of supply management across the board, not just in manufacturing. Therefore, the assertion that effective inventory management is important for ensuring the supply function's success is indeed true.