Store Administration in Public Sector
Chapter One
General Objective
- To identify the necessary stores managerial skills needed in Ministry of works
- To identify the challenges facing Ministry of works stores and also to maintain systematic records of materials.
- To examine the role of stores management in Ministry of works to minimize the storage costs of materials.
- To suggest ways of improving effective stores management.
CHAPTER TWO
LITERATURE REVIEW
Inventory Management
An inventory according to Stevenson (2006) ‘is a stock or store of goods’. According to Kotler (2000), inventory management refers to all the activities involved in developing and managing the stock levels of raw materials, semi-finished materials (working- progress) and finished goods so that adequate supplies are available and the costs of over or under stocks are low. Monczka et al. (2010) said that the cost of maintaining inventory is included in the final price paid by the consumer. Goods in inventory represent a cost to their owner. The manufacturer has the expense of materials and labour.
The wholesaler also has funds tied up. Therefore, the basic goal of the researcher is to maintain a level of inventory that will provide optimum stock at lowest cost. Coyle et al. (2003) stressed that inventory management in its broadest perspective is to keep the most economical amount of one kind of asset in order to facilitate an increase in the total value of all assets of the organization – human and material resources. Coyle et al. (2003) also stated that the major objective of inventory management and control is to inform managers how much of a good to re-order, when to re-order the good, how frequently orders should be placed and what the appropriate safety stock is, for minimizing stock outs. Thus, the overall goal of stock is to have what is needed, and to minimize the number of times one is out of stock.
Functions of Inventory
Several statistics clearly point up the significant functions of inventories and that, in most public sector today, inventories constitute the second-largest category of assets shown on the balance sheet, exceeded only by physical facilities and equipment Monczka et al. (2010). Rushton et al. (2006) therefore were of the view that inventory management has two broad functions;
Inventory accounting: Inventory accounting is concerned with book keeping aspect of inventory management. This function deals with the entering, processing and distribution of inventory stock which intend to provide a history for all inventory transactions. The inventory accounting will also among others things provide information which could be used to compare ‘book’ inventory to actual physical count of inventory stock. In-accurate, incomplete or delays inventory transaction cannot be the basis for correct inventory planning. Unless strict control is established and maintained, the entire inventory management system will be of no value.
Inventory control: This consists of planning, ordering, scheduling and the discharge of materials used in the manufacturing process. The inventory manager is concerned with all types of inventories in the organization.
Need for inventory management
Inventories make possible smooth and efficient operation of a manufacturing organization by decoupling individual segments of the total operation (Monczka et al., 2010). However, Stevenson (2006), was of the opinion that a typical firm probably has about 30 per cent of its current assets and perhaps as much as 90 per cent of its working capital invested in inventory. Organisational responsibility varies from industry to industry, even within the industry and more particularly with the size of the organization. Responsibility for inventory management was usually a multi-share function among most of the operating departments. Zanto (2008) stated that, with the growing trend towards the materials management concept, top management has been the wisdom of delegating full authority and responsibility for handling of materials for one person- the materials manager.
Also, Baily et al. (2005) argued out that ‘one of the reasons why the need for inventory has become important is to reduce the purchasing cycle’. He further explained that the purchasing cycle is the sequence of events that has to be gone through before an item is finally delivered to stock. When an organisation holds a high stock, the number of times this cycle has to be experienced is reduced. This cut down the use of management and administrative resources and thus reduces the cost of ordering (i.e. typing of orders, postage, negotiations, telephone calls, progressing, invoice checking, and payments).
CHAPTER THREE
METHODOLOGY AND ORGANISATIONAL PROFILE
Research Design
The study was carried out through a descriptive survey design on assessing the contribution of an effective and efficient supply chain management and the impact on organizations profit maximization. This research was considered appropriate as it deals with many workers who matters when it comes to supply chain management and hence calling for sampling in order to come up with generalizations and inferences about the whole population.
Population
The population of this study was drawn from Ministry of works. This study is targeting workers who are at the parts sales and warehouse departments of the organization.
CHAPTER FOUR
DATA ANALYSIS, PRESENTATION AND DISCUSSION
Personal information
Table 4.1 below illustrates the demographic features of the respondents. Out of 35 questionnaires distributed for this research, 32 useable questionnaires were returned giving a response rate of 91.4 per cent, which was considered very well for subsequent analysis. The personal data of the respondents such as sex, age and educational level were examined. This data were required to enable the researcher know the kind of participants used in the study.
From table 4.1 below, it can be see that all the respondents were males. It could be inferred that majority of the organization’s work force are males. Also 43.8% of the respondents are within the age group 31-40. However, it can be see that almost all the workers are within the working and productive population.
CHAPTER FIVE
SUMMARY OF FINDINGS CONCLUSIONS AND RECOMMENDATIONS
Summary of Findings
It was revealed that, the stores personnel are old, and do not have the requisite qualifications to manage the stores effectively and efficiently. It was also found out that, the number of staff under the stores function is few and then making the store operation so tedious to handle.
The researcher discovered that, requisitions are not always issued when issuing items to the user departments. It was realized that verbal requisition is still practiced in store Department of Ministry of works. This can cause discrepancies in the storehouse. Without the requisition form, items are not being recorded, thereby leading to conflict between the physical items and that on record.
The researcher discovered that, an appropriate criterion of classification is used in the store. Items are classified according to their nature and characteristics.
It was observed that the manual system is totally used in operation of store without any knowledge in computerized system. And so for that matter it has result lot of paper work and makes work cumbersome, ineffective and inefficient.
The researchers revealed that, keys to locks in the various sections are handled by store manager. Also it was discovered that the stock items are insured against theft, fire etc.
The study revealed that, incoming consignments are inspected by the storekeeper for quality and quantity against standards or specifications.
It was discovered that, store departments in the Department of Ministry of works take stock randomly, quarterly and annually to detect discrepancies.
Conclusion
The main objective of every stores management system in every organization is to ensure effective and speedy issues of materials, effective receipt of materials, good organization of stock, adequate storage facilities and constant check of stock levels. However, in achieving the above, cost/benefit analysis needs to be made. It has been confirmed that stores management system of Ministry of works has met the above qualities, except some few problems which are not any fault of theirs. Therefore, in conclusion, it has had an impact on the operation of Ministry of works.
Recommendations
The researchers would like to conclude that the role of stores is of a prime importance to every organization. However to ensure efficient and effective output of the stores department, it needs to be given the recognition that it deserves so that it can work effectively without unnecessary interference of its duties.
The Department should pay attention to the issue of professionalism and employ such people to run the store and by so doing the sector can enjoy large returns and will grow faster than it is doing how.
Finally, seminars and courses that involve stock management should be organized to encourage staff to upgrade their skills.
The researchers made the following recommendation based on their findings. Qualified personnel should be employed to handle the stores since stock represents huge amount of capital and therefore great care must be taken to reduce unnecessary cost and wastage in operations.
Store records should be computerized to make store operations effectively and efficiently.
Store-taking should be done regularly without giving stores personnel prior notice. This will help prevent staff from pilferage and theft.
The researchers recommend that there should be an effective coordination between the stores department and the user departments. This will enhance high service, better flow of information and a cordial relationship.
Stock items must be issued to the user department after providing a signed requisition form.
Inspection of stock must continue to be practiced and must be done regularly. This will prevent storekeepers from issuing expired and deteriorated items to customers or consumers.
REFERENCE
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