Purchase Management is a function of materials management in a company. Their basic function is procuring the inputs for production function. This function encompasses suppliers in the market external to the organization and several internal to the organization. Till recently, the purchasing process simply involved placing an order with the supplier who offered the lowest price. Nowadays, increase in competition and market demand and scarcity of resources have forced organizations to reexamine their purchasing activities. The purchasing department functions have expanded considerably and include activities such as verifying the credentials of suppliers, inspecting the quality of the material to be purchased, ensuring the timely delivery of the material, etc. While the value of purchased items varies from industry to industry, it adds up to more than fifty percent of sales in all industries. Purchase management is regarded as a significant activity in many organizations because of the high cost involved Continue reading
Operations Management
Agile Project Management – Concept and Stages
What is Agile Project Management? Agile project management has been defined as short cycles of product development that deliver incremental updates of the product rapidly based on the changing needs of the customer. This methodology is the opposite of waterfall project management, which values extensive planning and pre-production. The agile approach consists of a number of stages including rapid iterative planning and development cycles allowing a project team to constantly evaluate the project and obtain immediate feedback from users or stakeholders allowing the team to learn from their experiences after each cycle. After the streamlined planning requirements, definition and solution design phase is completed to get the project underway iterations or more detailed planning requirements are created. This allows for immediate modifications of the product as customer views change. Agile project management requires a dedicated full time team including a customer or end users. Agile project management differs to traditional Continue reading
Characteristics of a Good Plant Layout
The layout of a plant or facility is concerned with the physical placement of resources such as equipment and storage facilities, which should be designed to facilitate the efficient flow of customers or materials through the manufacturing or service system. The layout design is very important and should be taken very seriously as it can have a significant impact on the cost and efficiency of an operation and can involve substantial investment in time and money. The decisions taken with regards to the facility layout will have a direct influence on how efficiently workers will be able to carry out their jobs, how much and how fast goods can be produced, how difficult it is to automate a system, and how the system in place would be able to respond to any changes with regards to product or service design, product mix, or demand volume. In many operations the installation Continue reading
Inventory Control: Benefits of Holding Inventories
Inventory management is primarily about specifying the shape and percentage of stocked goods. It is required at different locations within a facility or within many locations of a supply network to precede the regular and planned course of production and stock of materials. The intent of inventory management is to continuously hold optimal inventory levels. The benefits of holding inventories are; 1. Avoiding Lost Sales Losing business is the last part where you, as a business owner wants. Without the necessary goods in hand, which are ready to be exploited, most businesses will surely lose its business and market share. There are some customer are willing to wait, especially when the product they want must be made to order or it is not sidely available from your competitors. Thus, your business must prepare itself to provide the goods or product demanded by your customers. For instance, Shelf Stock are Continue reading
Concept of Store Management
Storekeeping is a service function which deals with the physical storage of goods under the custodianship of a person called storekeeper or stock controller. Goods stored may be either, stores or stock. Unworked materials or raw materials are usually referred to as stores and the place where they are kept is known as stores room. Finished products ready for shipment are usually called stocks and are housed in a place called stock-room. Storekeeping, therefore, is that aspect of materials which is concerned with physical storage of goods. Store functions concern receiving, movement, storage and issue of items- raw materials, bought out parts, tools, spares, consumables etc. —required for production, maintenance and operation of the plant and finished goods until is dispatch to customers. Store, therefore, is the custodian of all goods that are received in the company until they are consumed or sold and naturally it assumes the responsibility of Continue reading
Preventive Maintenance
Preventive maintenance anticipates failures and adopts necessary actions to check failures before they occur. It includes activities like inspection, lubrication, cleaning unkeeps, minor adjustments and replacements found necessary at the time of inspection etc. Its purpose is to minimize breakdowns and excessive depreciation. Neither equipment nor facilities should be allowed to go to the breaking point. In its simplest form, preventive maintenance can be compared to the service schedule for an automobile. Preventive maintenance can be either: running maintenance or “shut down maintenance”. Running maintenance includes maintenance activities e.g. minor adjustments in machines revealed through inspections, lubrication, cleaning and upkeep etc., which are carried out when the machine is still running. Shutdown maintenance includes preventive maintenance activities such as minor component replacement whose needs are identified through inspections, which require stoppage of machines. Preventive inspection is one of the key activities of preventive maintenance which is usually performed by Continue reading