Material department functions. Functions of Material Management 2022-11-16
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The material department is a critical component of any organization, as it is responsible for the procurement, storage, and distribution of materials and supplies needed for the smooth operation of the business. The functions of the material department can vary depending on the size and nature of the organization, but some common functions include:
Procurement: The material department is responsible for identifying and purchasing the materials and supplies needed by the organization. This includes evaluating suppliers, negotiating prices, and placing orders.
Inventory management: The material department is responsible for maintaining accurate records of the materials and supplies in the organization's inventory, including tracking the quantities and locations of items. This helps to ensure that materials are available when needed, while also minimizing excess inventory that can tie up capital and increase the risk of obsolescence.
Distribution: The material department is responsible for ensuring that materials and supplies are delivered to the appropriate locations within the organization in a timely manner. This may involve coordinating with various departments to determine their needs and coordinating with suppliers to ensure that orders are fulfilled.
Quality control: The material department is responsible for ensuring that the materials and supplies being used by the organization meet the necessary quality standards. This may involve performing inspections or testing of incoming materials, as well as identifying and correcting any issues that arise.
Cost control: The material department plays a key role in helping the organization to control costs by negotiating favorable prices with suppliers and by minimizing waste and inefficiency in the use of materials and supplies.
In summary, the material department is responsible for the procurement, storage, and distribution of materials and supplies needed by the organization, as well as ensuring the quality and cost-effectiveness of these materials. By carrying out these functions effectively, the material department helps to support the overall efficiency and success of the organization.
Roles of materials management in operations
The interval between receiving the purchased parts and transforming them into final products varies from industries to industries depending upon the cycle time of manufacture. Therefore, finished goods inventory is the stock of completed products. System Efficiency This function ascertains the efficiency of the system being used. R Trethewey and R. For this, it is necessary for the purchase department to give advance notice to the accounts department regarding such money requirements. There are three types of the procurement: direct procurement, indirect procurement, and service procurement. Their work helps the purchasing manager in working with supply agents and taking the best procurement decisions for the organization.
Materials Management: Objectives, Scope and Functions
In addition to the above functions, the following four major responsibilities of materials management may also be enumerated here : 1. To improve productivity and wealth, a company must first design efficient and effective systems for manufacturing. A company can manage the risks with suppliers by diversification of the supply chain. The first hierarchical databases were developed for automating bills of materials for manufacturing organizations in the early 1960s. The materials department, along with the help of the engineering department, by taking the pros and cons of making or buying, should buy from outside sources only if it is economical to do so. Materials requirement planning systems and procurement systems are well-liked in the industry.
Firms are trying to have a zero inventory approach to save on costs. Just in Time or JIT is another technique which is being widely used which practically does not require inventory. For example, a bill of materials for a house would include the cement block, lumber, shingles, doors, windows, plumbing, electric, heating and so on. Springer Texts in Business and Economics. Design and Development of the Product The variety in product and functionality are the important factors to promote the sales of a product.
The MRP is used by every company on computers that uses an MPS for product manufacturing requiring assemblies, materials and components to manufacture the final products. Materials Planning and Programme, 2. They can also track quality and contribute significantly towards the timely delivery of end-products. New materials and products: The materials manager is always in touch with the outside world. Stores Management : Proper receipts, inspection, storage and preservations, safety and issue of materials with efficient documentation assist in good house-keeping of materials in a warehouse.
This provides an opportunity to the materials department to play an advisory role in its relation to the production department. Gale Academic OneFile accessed February 20, 2022. MATEC Web of Conferences. Another technology development in manufacturing is the Computer Aided Manufacturing CAM that can bring both a variety as well as flexibility to a product. Meets the quality and quantity requirements. Checking supply invoice against purchase order and goods received and payments are made.
Relationship of Material Management with other Areas of Management Functions
This is done together with two other departments: Marketing and Finance. Since the materials department is in constant touch with the market, the disposal of such materials is always to the advantage of the materials department. By collaborating with the sales department and gaining insight into the sales volume, the procurement department must be able to forecast the rise or fall in demand for products, which will help in cutting costs or increasing the expenditure level at the right time, thereby profiting the company. Inventory means idle money and, therefore, the lower it is, the higher will be the profit. Tests required for quality assurance should be specified and conducted as per the specified standards. Not only does it make sure production schedules can be met, but it can also save costs for a finished product while also maintaining quality through the materials that are purchased and used. They must facilitate fair, legal, and proper relationships with all suppliers for sustainable development and growth.
Organizational Structure of Materials Management Department
As the procurement of raw materials is done only for production, finally a product is manufactured for selling; a customer would look for a quality product apart from price. The vendor can be rated on various characteristics such as: 1. Without efficient systems, material management objectives are ineffective. In addition to this, they have many more functions such as: the training of new employees, salaries according to the job position, vacation assignment, compliance with regulations, promotions, promotions, among others. The role of materials management is to balance these conflicting objectives by coordinating the flow of materials, so customer service is maintained and the resources of the company are properly used. Stock out of any of these may totally disrupt the production causing severe losses to the company. Purchasing Purchasing should be done economically and on time to maintain material supplies and increase final profits by lowering expenses.
The application ties overall business planning and forecasting to detail operations through the Master Production Schedule. It sets the quantity of each end item to be completed in each week of a short-range planning horizon. Any pricing or engineering or development decision can be taken only after getting proper advice from the purchasing department. Uncertainty in demand and production quantity is one of the main factors of such disruptions. Disadvantages of not having departments of a company A very common mistake made in companies is to believe that all workers with a similar education can perform the same function, which is illogical. Analytical methods are used for systematic forecasting and planning to procure the various materials required for production. Before its supply to the consumers, the final products are also first stocked as inventory to cater to the irregular demand and stabilize the supplies in the market.
