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Scope &#038 Functions of Material Management

Materials management involves coordinating planning, sourcing, purchasing, storage, and control of materials to provide customers with products at minimum cost. Its key functions include materials planning and control, purchasing, inventory control, standardization, simplification, and value analysis. The scope of materials management is vast and aims to optimize the flow of materials through the organization.

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Sayan Debnath
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493 views3 pages

Scope &#038 Functions of Material Management

Materials management involves coordinating planning, sourcing, purchasing, storage, and control of materials to provide customers with products at minimum cost. Its key functions include materials planning and control, purchasing, inventory control, standardization, simplification, and value analysis. The scope of materials management is vast and aims to optimize the flow of materials through the organization.

Uploaded by

Sayan Debnath
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Scope & Functions of Material Management

Materials management is defined as “the function responsible for the coordination of planning,
sourcing, purchasing, moving, storing and controlling materials in an optimum manner so as to
provide a pre-decided service to the customer at a minimum cost”.From the definition, it is clear
that the scope of materials management is vast.

Functions of Material Management


The functions of materials management can be categorized in the following ways:

Material Planning and Control


Purchasing
Stores Management
Inventory Control or Management
Standardization
Simplification
Value Analysis
Ergonomics
Just-in-Time (JIT)
All the above-mentioned functions of materials management have been discussed.

Nature and Scope of Material Management


Scope of materials management

Materials planning and control:


Based on the sales forecast and production plans, materials planning and control is done. This

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Scope & Functions of Material Management

involves estimating the individual requirements of parts, preparing materials budget, forecasting
the levels of inventories, scheduling the orders and monitoring the performance in relation to
production and sales.
Purchasing:
This includes the selection of sources of supply finalization in terms of purchase, placement of
purchase orders, follow-up, maintenance of smooth relations with suppliers, approval of payments
to suppliers, evaluating and rating suppliers.
Stores management or management:
This involves physical control of materials, preservation of stores, minimization of obsolescence
and damage through timely disposal and efficient handling, maintenance of store records, proper
location and stocking. A store is also responsible for the physical verification of stocks and
reconciling them with book figures. A store plays a vital role in the operations of a company.
Inventory control or management:
Inventory generally refers to the materials in stock. It is also called the idle resource of an
enterprise. Inventories represent those items, which are either stocked for sale or they are in the
process of manufacturing or they are in the form of materials, which are yet to be utilized. 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. It is, therefore,
necessary to hold inventories of various kinds to act as a buffer between supply and demand for
the efficient operation of the system. Thus, effective control on inventory is a must for the smooth
and efficient running of the production cycle with the least interruptions.
Other related activities
Example:
Specifications of an axle block are Inside Dia. = 2 ± 0.1 cm, Outside Dia. = 4 ± 0.2 cm and Length
= 10 ± 0.5 cm.
3S

Standardization: Standardization means producing a maximum variety of products from the


minimum variety of materials, parts, tools, and processes. It is the process of establishing
standards or units of measure by which extent, quality, quantity, value, performance, etc. may be
compared and measured.
Simplification: The concept of simplification is closely related to standardization. Simplification is
the process of reducing the variety of products manufactured. Simplification is concerned with the
reduction of product range, assemblies, parts, materials, and design.

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Scope & Functions of Material Management

Specifications: It refers to a precise statement that formalizes the requirements of the customer. It
may relate to a product, process or service.
Value analysis: Value analysis is concerned with the costs added due to inefficient or unnecessary
specifications and features. It makes its contribution to the last stage of the product cycle, namely,
the maturity stage. At this stage research and development no longer make positive contributions
in terms of improving the efficiency of the functions of the product or adding new functions to it.
Ergonomics (Human Engineering): The human factors or human engineering is concerned with the
man-machine system. Ergonomics is “the design of human tasks, man-machine system, and
effective accomplishment of the job, including displays for presenting information to human
sensors, controls for human operations and complex man-machine systems.” Each of the above
functions is dealt with in detail.

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