Block 5 Section 2 Part I - Up Dated

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(pg. 202 & 203 Galloway, et. al)
"

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1. What do we mean by materials?
2. What do we mean by a materials systems?
3. What is materials management trying to
achieve?
4. What are the key questions for managers
of materials
5. What techniques are available to the
manager? Ô `

(pg 203 & 204)
All Organizations need to acquire
[
and use materials if they are to
function properly. However,
materials are used differently in
goods manufacturing and service
G `
provision.
* (pg. 204 & 205)
There are different classifications

for materials:
1.Raw materials
2.Work in progress
3.Inventory
4.Consumable materials
5.Buffer stocks
- `
* (pg. 204 & 205)
&' ( ! Are those items
which are stored waiting to be
worked on.
' )
! Are materials
that are being worked as a part of
the process.

G'
$
! These are transformed
inputs into their final stage/product.
Usually referred to as finished
`
* (pg. 204 & 205)
*' ¦
! Those materials that are
used by the process but do not form a part of the
direct material that is passed down the supply chain.
e.g. Lubricants.
' |! Are materials that are being
deliberately used to protect the operation from the
otherwise disruptive effects of interruptions to
supply or sudden increases in demand.
`
*

(pg. 206-207 Galloway, et. al)

+

$

( $
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*
" *
½ `
*

" * ! This is the time which

elapses from the placing of the
orders to the actual delivery.:;
=>? :; <
@A BCDEFC
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(Pg. 207 Galloway, et. al)
$

!
` The operation can stop running smoothly.
` Delay in outputs may dissatisfy customers.
` Can lead to lost support for the org.
` Idleness
BH of the operation can incur costs
associated with staff, equipment & facilities.
` ¥ tra costs for unplanned stopping of the process.
` Cost penalties for delay in delivery of orders
2 `
*


!m m

m mmm
` tock levels have financial implications.
` tock represents certain risks.
` High stock levels can be a powerful
force against improvement.
ÿ `

(Pg. 209-215 Galloway, et. al.)
Two of the main categories to
measure both efficiency and the
effectiveness of stock management
within an organization are:
1. Customer service level
2. Inventory investment
ÿÿ `
w

,

w


w
is defined as demand that is
independent of the demand of others and/or demand is
outside the control of the operation and is usually subject to
trends and seasonal patterns.K LJ >BK LJIC
K L OLPQRLSTUR#CDNC#MK L >B
PVRSWC!RR "E=XRORC
w

w
is defined as demand which results from
the demand for other items.
[ K LA? K L$K LIC
Y#D?Z
ÿÔ `
*
-

'
(pg. 217/18 Galloway, et. al)
*
-
concept is
intended to assist managers in deciding amounts
of material that need to be ordered. This is
done by a formula that calculates the order
quantity that minimizes the total incremental
costs of holding inventory and processing
orders.O$RB[\I$] R;^_R`?H_]@
aD[\bRZ!R$$ $

>K LdRBZ_> eZfgACc
CD] CbbhRFhiRHj
ÿG `
*
-

¦
$%
o interest
o insurance
o council ta
o deterioration in value U$
;
o stock management ÿ- `
*
-

¦
$% kCDiRH $B
o Preparing the order
o Preparing material specifications
o Tracking the order
o Processing invoices
o Receiving & handling delivered
ordered materials
ÿ `
*
-

Total holding costs Total ordering costs

G G
ÿ ÿ
ÿG½2 ÿG½2
l
Volume (000s)
HC = Q CU o. of orders to be placed a year = R/Q

Where; Where;
Q is the volume of inventory R is the annual number of units to be ordered
CU is the cost of holding one unit Q is the quantity to be ordered
ÿ `
*
-

Holding and Ordering Holding and ordering
Cost Costs summed

G
G
ÿ
ÿ
ÿG½2
ÿG½2 The optimal Volume of units
to hold is where the totals of
the OC and HC is at its
lowest point.
ÿ½ `
*./
¥

)%
0the ordering cost per order
0annual usage
0 storage cost per year as a
decimal factor of the purchase price
¦0 unit purchase priceÿL `
*./

(Pg. 222 Galloway, et. al.)
1. Average demand is at a constant level.
2. upply lead time is constant.
3. The replenishment of the inventory item is not
connected with the replenishment of any other
item.
4. The unit purchase price, the ordering cost and
the storage cost do not change.
5. The ¥OQ is equal to the amount which can
actually be delivered by the supplier.
ÿ2 `

./
(Pg. 222/223 Galloway, et. al.)
1. The risk of obsolescence.

2. The risk of deterioration.
3. Limited storage space.
4. The availability of money for
stock purchases
Ô `
*

It is important to know when to place an
order. At what level should the e isting
stocks be when an order is placed i.e.
reorder point:
`ituations of known demand
`ituations of uncertain demand
Ôÿ `

$
¦

Two basic types of control system are used to help
manage the flow of materials. They act as
mechanisms to draw the attention of managers to
the fact that action is required answering these
questions:
1. How often should stock levels be checked?
2. When should an order for more stock be
placed?
3. What quantity should be ordered?
ÔÔ `

$
¦

(Pg. 228-233 Galloway, et. Al.)
The two basic types of control system

are:
` The continuous review fi ed reorder
quantity system
` The periodic reorder system
ÔG `

(Chapter 8 Galloway, et. al, Pg 237)
* !
The M shows the output required over the
short term (usually 3 months). Presented
normally as a time-phased calculations
where (Available stock - forecast) +
Production = on-hand and available
inventory
Ô- `
* 1' (pg. 240 Galloway, et. al.)
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Forecast Ô Ô Ô Ô Ô
Available stock Ô
Production
On hand
Ô `
* 1
1' (pg. 240 Galloway, et. al.)
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Available stock Ô
Production
On hand
Ô `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Available stock Ô
Production
On hand
Ô½ `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Available stock Ô Ô
Production
On hand Ô
ÔL `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Available stock Ô Ô Ô
Production
On hand Ô Ô
Ô2 `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
G `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
Gÿ `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
GÔ `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
GG `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
G- `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô
G `
* 1' (pg. 240 Galloway, et. al.)
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô Ô
G `
* 1
Weeks 1 2 3 4 5 6 7 8 9 10 11 12
Production
On hand Ô Ô Ô
The inability to meet demand from week 8 will have to be

discussed between production and sales
G½ `

`m
`m
`
GL `
*

(pg. 249 Galloway, et. al)
1. Material requirement planning
(MRP ) system
2. ¥nterprise resource planning (¥RP)
systems.
3. The Optimized production technology
(OPT)
4. Just in time manufacturing
G2 `
m

#
(pg. 49 binder) Chapter 9 Galloway, et. al
#is a set of activities that has a definable

start and a definable end . They can be large or
small in size, e.g. Building the Millennium Dome, or
painting a room.
Other e amples of projects include:
§Developing a new software package
§Relocating an office
§Implementing a new information system
§Opening a new hospital
§etting up a new business
- `
#¦ (pg. 278 Galloway, et. al)
§A well-defined objective
§Most projects are usually a one-of-a kind
undertaking
§Relationships between project activities can be
comple .
§Project carry a certain amount of risk in terms of
time, cost and resources due to changes in the
environment that can occur.
§Once a project achieves its specific objective the
resources used on the project are usually abandoned.
§All projects go through different stages.
-ÿ `
* #

(pg 279 Galloway, et. al)
` Manage the project·s work content to define the
goals and the work to be done in detail
` Manage the people involved in the project
` Manage information and channels of
communications within the project
` Manage time by planning and meeting a schedule
` Manage quality so that the project outcome is
satisfactory
` Manage costs so that the project is performed
within budget -Ô `

#

(Pg. 279-282 Galloway, et. al)
¥ffective planning and control of projects
depends on clear understanding of the
following stages in project management:
`#
$

`#

`#

`#

-G `

#

(Pg. 279/80 Galloway, et. al)
` #
$

! Relates to factors
which may influence the project during its
life cycle, such as; supplier·s reliability,
political instability, local laws, national
culture of the host country, etc.
` #

! This is being clear as
much as possible on what is going to be
done. This includes the projects objectives,
scope and strategy.
-- `

#

(Pg. 281/82 Galloway, et. al)
` #

! This determines the
duration and cost of the project. It also assists in
the allocation of work to people, monitoring
progress and assessing the impact of any change
on the project.
` #
! This relates to mgt of activities
that take place during the e ecution of the
project i.e. decisions on monitoring the
progress, measuring the performance, etc.
- `

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There are different classifications

" * ! This is the time which

HC = Q CU o. of orders to be placed a year = R/Q

1. The risk of obsolescence.

The two basic types of control system

The inability to meet demand from week 8 will have to be

#is a set of activities that has a definable

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Block 5 Section 2 Part I - Up Dated

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There are different classifications

" * ! This is the time which

HC = Q CU o. of orders to be placed a year = R/Q

1. The risk of obsolescence.

The two basic types of control system

The inability to meet demand from week 8 will have to be

#is a set of activities that has a definable

Potrebbero piacerti anche

|

" * ! This is the time which

HC = Q CU o. of orders to be placed a year = R/Q

#is a set of activities that has a definable