MBA-MGMT 672 -TOM_UNIT_9_TO_12-BLOCK-03 - Copy - Copy.doc

All these classifications help in identifying more

This preview shows page 73 - 76 out of 78 pages.

All these classifications help in identifying more important items to be taken up for close supervision and management by materials management on SELECTIVE basis. An organisation may require and use thousands of different items, therefore it usually is not feasible to monitor all of them equally closely. vi) Quality Assurance of Incoming Materials Purchase function major responsibility, in consultation with production and engineering function to assure the quality of purchased material. Proper sped final ions have to be decided and finally conveyed as part of purchase orders. The characteristics/ standards need to be put down in purchase orders in unambiguous items. The technical terms should uniquely be understood by the supplier. The testing and inspection methods/ procedures, the type of tests that are required to be conducted; all need to he specified accurately. MGMT 672 - TOM-MBA (MANAGEMENT) & MBA (FINANCE) 73
Image of page 73

Subscribe to view the full document.

Technology & Operations Management (TOM) Block 3 Production Planning & Control The purchase department can achieve required quality of incoming material by: a. Conveying correct specifications. b. Assessing quality capability of supplier before placement of purchase order. c. Frequent testing and inspection at the suppliers production facilities, if considered necessary. d. Insisting on proper certification of dispatched material from the supplier's facility. e. Proper packaging and transportation to avoid deterioration/damage/breakage during transition. f. Testing and inspection at the receiving end. Insisting on approved quantity and quality certificate by receiving point so as to release the payment. g. Proper storage in the warehouse/store so as to avoid deterioration/damage during storage. h. Revising and conveying the quality specification as and when needed well in advance. So as to avoid stockpiling and or getting mixed up of 'old' quality items with ‘new’ quality items. All these steps, used appropriately, help in insuring the right quality of the incoming materials; which ultimately reflects in the final product of the company. Activity D Does ABC/VED classification help in managing inventories? Explain. Activity E Inventory of materials provides operational flexibility. But, many flexible operational systems need little inventory. Explain this seeming contradiction. MGMT 672 - TOM-MBA (MANAGEMENT) & MBA (FINANCE) 74
Image of page 74
Technology & Operations Management (TOM) Block 3 Production Planning & Control Activity F Discuss the role of inventory in the organisation's strategic management. Activity G Conduct a survey in a library registers and analyse the inventory (books) on the basis of ABC and FSN analysis. Issues Relating to Storage and Material Handling Optimum Level of Inventory How much inventory of each item is to be maintained? This is the result of trade off between keeping very high inventory resulting into high inventory holding costs vs keeping very low inventory with high risk of stockout. A related question is When to order and how much to order? What should he the level of reorder point and safety stock?
Image of page 75

Subscribe to view the full document.

Image of page 76

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern