Furthermore, inventory reduction programmes are also widely established in order to release cash for alternative uses. Besides the effects on liquidity, inventory-reduction programmes are also expected to increase financial profitability. The logic behind this argument draws on the classical DuPont system of financial control and is quite obvious: decreasing inventories lead ceteris paribus to reduced capital requirements, causing profitability measures such as return on assets to increase (and vice versa). This also holds in a more sophisticated value-based management environment with residual income (e.g. Economic Value Added) as a key performance measure.