Individual assignment on material and supplies management 1


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Individual assignment on material and supplies management 1

  1. 1. Addis Ababa University College of Education and Behavioral Studies Post Graduate Program Program: Managements of Vocational Education Course: Supplies property and Material Management in Vocational Education Course: numbers BVED626 Individual Assignment Prepared by: Berhanu Tadesse GSE/0514/11 Submitted to: GIRMA ZEWDIE (ASSOCIAT PROFESER) February, 2013 Addis Ababa
  2. 2. Abstract Technical and vocational education and training (TVET) has an employment, self employment and enterprise which solve the economic problem of the individual and as a whole nation. Hence, among all management of vocational professionals must have exposition of materials and supplies management for effective and efficient performance operation of training institution by using as a guideline/ manual . Therefore this group assignment will cover among the facilities needed for sound operation of a training institution on equipment hence, a manual or guidelines holds for effectively utilizing the specific facility the assignment include: concept and definition of suppliers and materials managements, the rationale for it (the fundamental and logical reason), How these facilities are determined for each area of specialization, current status of these in the institution you are working on, purchasing and associated issues, replenishment (where applicable), maintenance, Evaluating the effectiveness of the facility at hand relevance to the current need, Estimation of future demand, important points relevant to the project also included. The supply area also is an excellent training ground for new managers. The needs of the organization may be quickly grasped. Exposure to the pressure of decision making under uncertainty with potentially serious consequences allows for evaluation of the individual’s ability and willingness to make sound decisions and assume responsibility. Contacts with many people at various levels and a variety of functions may assist the individual in learning about how the training institutions work. Many training institutes find it useful to include the supply area as part of a formal job rotation system for high-potential employees. The highly competitive environment, linked to the globalization phenomena, demands from companies more agility, better performance and the constant search for cost reduction. The present study focused on improvements in internal materials handling management, approaching the case of a large company in the automotive industry. Materials handling is intrinsically associated with production flow. Because of this, it has direct influence on transit time, resources usage, and service levels. The objective was to evaluate, in a systematic way, the impact of implemented changes in materials handling management on the internal customers’ perceptions of cost, safety in service, service reliability, agility and overall satisfaction. A literature review preceded a case study in the company’s manufacturing unit. Analyzing the answers, it was possible to suggest that internal customers understood that the new materials handling management system enlarged service agility and reliability and reduced costs, which caused an improvement in overall satisfaction.
  3. 3. Acknowledgements First of all, I would like to express my heartfelt gratitude to my dear instructor Girma Zewdie (Assoc. professor) for giving me the chance to further understand the course by consulting different printed and electronic sources of knowledge. Secondly, I would like to extend my appreciation and special thanks to my friend and classmate Ato Bantalem and Ato Dawite for their support in allowing me to use their computers when we are both in deep need of computers. Finally, I am grateful to, wzerit Almathwork who acted in a manner suitable for the completion of my assignment by neatly printing and binding the project. Table of content 1. Introduction…………………………………………………………….....3 2. Définitions of supplies and matériel It incluedes management parts.......5 3. Rationale for using Manual/Guideline of supplies and matériel…………….......................................................................................9 4. How these facilities are determined for each areas of specialization.. .....14 5. Current Status of these in the institution you are working 6. Purchasing and Associated Activities ....25 7. Replenishment ...31 ................21 8. Maintenance .....36 9. Evaluating the effectiveness of the facility at hand ......40 10. Relevance to the current need ......44 11. Estimation of future demand 12. Other points that might be relevant to the project 13. Conclusion ................47 .....52 ................56 14. Recommendation to solve the problems of vocational education …………………58 15. Appendixes..................................................................................................61
  4. 4. Introduction This manual/guidelines report on the need more attention on supplies and materials management. The assignment work intention was avoiding obsolete materials use of to improve procurement, material management and add value to the system by reducing cost and eliminate time wastages. By avoiding the traditional approaches to supplies and materials management uses planned operations where managers design a detailed scheduled for each distinct activity of it. Materials management practice in TVET institutions is the basic, which could assess the institutional needs, forecasting and planning for educational and training materials, acquisition of educational and training materials such as text books, machinery, equipment etc…., receiving materials, storing materials, inventory control and disposal of scraps, that has to formulate strategies to minimize the cost in order to maximize the benefits of the institutions. Regarding planning for materials, institutions should forecast their future materials plans and consumption of the institution and will also control qualities, quantities and materials availabilities in store. Materials management can make necessary arrangement to ensure supply of quality and quantity materials as and when needed in the process of production at a minimum cost (sherleckar & others, 1988). Teaching materials play an important role in learning teaching process in TVET institutions. These are the means that students get skill and learn effectively. In relation to handling of teaching materials when storing, moving and using in practice need due attention. Material handling refers to activities, equipment and procedures related to the moving, storing, protecting and controlling of materials in a system. Therefore, effective and efficient utilization of teaching materials resource and manage as being one of the vehicles for national development, requires effective resources that would answer to the requirements and need of employees and stakeholders. The technical vocational education and training (TVET) system is, thus, assumed to be responsible to provide the required manpower to the socio-economic development of one's country. To this end, TVET has been given due attention worldwide long ago. Furthermore, there is a national TVET strategy in Ethiopia replaces an older version adopted in 2002. It reflects an important paradigm shift of recent years which places quality and relevance of TVET as its priority (MoE 2008). Global experience has shown that there were expansion of TVET does not solve the problems of unemployment low productivity of the economy. TVET has to respond to the competence needs of the labour market and create a competent, motivated and adaptable workforce capable of driving economic growth and development. The strategy
  5. 5. also concerned with the implementation of TVET institution teaching material resource management. To this end, to study will assess "how they have managed the teaching material resource?" in the selected Addis Ababa TVET colleges. In reality, handling of teaching materials face many problems and challenges. The major one includes poor handling of teaching materials non-standard store, lack of skill tore keeper, in effective using of materials and others including procurement. Therefore this group assignment will cover among the facilities needed for sound operation of a training institution on supplies and materials management hence, the paper holds a manual or guidelines for effectively utilizing equipment facility the assignment include:, the rationale for it (the fundamental and logical reason), How these facilities are determined for each area of specialization, current status of these in the institution you are working on, purchasing and associated issues, replenishment (where applicable), maintenance, Evaluating the effectiveness of the facility at hand relevance to the current need, Estimation of future demand, important points relevant to the project also included. The supply area also is an excellent training ground for new managers. The needs of the organization may be quickly grasped. Exposure to the pressure of decision making under uncertainty with potentially serious consequences allows for evaluation of the individual’s ability and willingness to make sound decisions and assume responsibility. Contacts with many people at various levels and a variety of functions may assist the individual in learning about how the training institutions work. Many training institutes find it useful to include the supply area as part of a formal job rotation system for high-potential employees. The highly competitive environment, linked to the globalization phenomena, demands from companies more agility, better performance and the constant search for cost reduction. The present study focused on improvements in internal materials handling management, approaching the case of a large company in the automotive industry. Materials handling is intrinsically associated with production flow. Because of this, it has direct influence on transit time, resources usage, and service levels. The objective was to evaluate, in a systematic way, the impact of implemented changes in materials handling management on the internal customers’ perceptions of cost, safety in service, service reliability, agility and overall satisfaction. A literature review preceded a case study in the company’s manufacturing unit. Analyzing the answers, it was possible to suggest that internal customers understood that the new materials handling management system enlarged service agility and reliability and reduced costs, which caused an improvement in overall satisfaction. It is also important to study teaching material management from the point of view of the actual problem existing in our situation. In our country, especially in TVET institutions, it seems that materials management has not been given due concern. The entire administration of teaching materials resources appears to be left only to the storekeepers or others who do not feel a sense of responsibility or do not have the ability to manage it. When TVET college constructed not included in structure of building the store have standard size and which have ventilation and good temperature store, according to the nature of material are damage before utilize by the
  6. 6. student. The user after taking from the main store they kept the teaching material inappropriate place which expose for loss and damage. All in bound material must be physically received as it moves from a supplier to a purchaser. in a non-just-in-time environment, material must also be stored or staged receiving, materials handling and storage are usually part of the materials management function because of the need to control the physical processing and handling of inventory. Receipts from users indicating the services have been performed are also run through receiving to trigger invoice payment. (Monczka, 2010). Q. 1. Definition of terms; Materials and supplies; It incluedes management parts Materials: Refers to the whole range of goods and services which are purchased or otherwise procured from sources outside the organization, and are used or processed or distributed in order to provide finished products of other producers, which include energy and specialized services, raw materials and merchandise for resale (Bezabeh, 1990). Materials: having physical form or substance; “that which is created is of necessity corporeal and visible and tangible” Benjamin Jowett things need for doing or making something: “writing materials”; useful teaching materials. It is concerned with planning, organizing and controlling the flow of materials from their initial purchase through internal operations to the service point through distribution. Material management is a scientific technique, concerned with Planning, Organizing &Control of flow of materials, from their initial purchase to destination. A Brief concept of Material management In many organization materials from the largest single expenditure item. An analysis of the financial statements of a large number of private and public sector organizations indicates that materials account for nearly 60 percent of the total expenditure. Thus, the importance of material management lies in the fact that any significant contribution made by the materials manager in reducing materials cost will go a long way in improving the profitability and rate of return on investment. The various functions served by materials management include the materials planning, purchasing, receiving, stores, inventory control, scrap and surplus disposal (Gopalakishnan and Sundaresan 2003:3 and 4) materials management in TVET institution is important. TVET institution without materials flow does not accomplish its objectives. Materials which have costs need materials plan and forecast of the demand and control are the major
  7. 7. operational area in all organization and in TVET institution. Fearon 1989:27) explain that, materials management in education is the single organizational management concept that embraces planning, organizing, monitoring and controlling of all those activities and personnel principally concerns with the flow of materials into an organization to points of use. Materials management is part of business logistics and refers to overseeing the location and movement of physical items or products. There are three main elements associated with such management: spare parts, quality control, and inventory management. Materials management is important in large manufacturing and distribution environments, such as warehouses, where there are multiple parts, locations, and significant money invested in these items. PURPOSE OF MATERIAL MANAGEMENT • • • • • To gain economy in purchasing To satisfy the demand during period of replenishment To carry reserve stock to avoid stock out To stabilize fluctuations in consumption To provide reasonable level of client services Objectives of materials management The objectives of materials managements can be classified in two categories; primary and secondary. There are at least nine primary objectives. These are low prices, high inventory turnover, low cost acquisition and possession, continuity of supply, consistency of quality, low payroll cost, favorable relation with supplies development of personnel and goods records. Primary objectives 1. To purchase the required materials at minimum possible prices by following the prescribed purchase policies prices by following the prescribed purchase policies and encouraging healthy competition. 2. To achieve high inventory turnover i.e. to meet materials requirement of the organization by keeping low average stocks so that the capital locked up in materials is turned over a large no of times. 3. To incur minimum possible expenditure on administrative and other allied activities related to purchase of materials and also to keep the materials in stock till they are finally delivered to the users. 4. To ensure the continuity of supply of materials to the users is maintained by avoiding out of stock situation.
  8. 8. 5. To supply materials of consistent quality i.e. of quality which meets user specification and is fit for service. 6. To keep the wage bill of the department law by ensuring proper distribution of work among stage and not employing surplus staff. 7. To maintain good relationship with the suppliers of materials and also develop new suppliers for the products for which reliable suppliers do not exist. 8. To ensure training and development of personnel employed in the department so that good industrial relations are maintained. 9. To maintain proper and up- to- date records of all stores transactions and purchases. 10. To participate make or by decisions make or buy situation arise due to many reasons. Mostly such situation arises because the desire to control the production processes and cost factors. 11. To secure dependable sources of supply: The selection of right supplier is of a great importance to the educational establishment requiring the materials. The concerns revolving around the right sours is that the dependability of suppliers in producing the required items. 12. To achieve high degree of cooperation and coordination with the users department (e.g. facilitate the necessary cooperation and condition with the users). 13. To create harmonious relationship among units with an organization (e.g. enhance friendly relationship among units with an organization). 14. To minimize administrative cost of purchase (e.g. seeking the least possible cost using different mechanisms) Primary objectives summery • Right price, High turnover, Low procurement, & storage cost, Continuity of supply, Consistency in quality, Good supplier relations, Development of personnel, Good information system Secondary objectives 1. To assist technical/ design department in developing new materials and products which may be more profitable to the organization. 2. To make economic make or buy decisions. 3. To ensure standardization of materials. 4. To contribute in the product improvement. 5. To contribute in the development of inter departmental harmony.
  9. 9. 6. To follow scientific methods of forecasting prices and future consumption of materials. Secondary objectives summery • Forecasting, Inter-departmental harmony, Product improvement, Standardization, Make or buy decision, New materials & products, Favorable reciprocal relationships Supplies: - Are small, non permanent materials that are used for instructional purposes and are actually consumed in use (Girma, 2010).it is for training institution. Supplies:-is used include all material, goods and service used in an enterprise, regardless of whether they are purchased outside, transferred from another branch of the company or manufacture in its own production line. In economics theory of supply is the willingness of producers to sell a given amounts of goods that form of a supply schedule or it can be charted in the form of a supply schedule or it can be depicted on a graph. As a rule, the higher the price, the more reluctant they are to sell. However, the supply of some goods simply cannot be in created over the short term, no matter how high the price, rises, although, given enough time, the supply of even very scarce commodities ( such as gold and platinum) can usually be increased if the price is high enough. The degree to which supply responds to price changes is called its Elasticity. Supply management The term supply management describes the methods and processes of modern corporate or institutional buying. This may be for the purchasing of supplies for internal use referred to as indirect goods and services, purchasing raw materials for the consumption during the manufacturing process, or for the purchasing of goods for inventory to be resold as products in the distribution and retail process. In many organizations, acquisition or buying of services is called contracting, while that of goods is called purchasing or procurement. The supply management function of an organization is responsible for various aspects of these acquisitions: Supply management is generally regarded as a systematic business process that includes more functions than traditional buying, such as coordinating inbound and internal pre-production logistics and managing inventory. Supply management deals primarily with the oversight and management of materials and services inputs, management of the suppliers who provide those inputs, and support of the process of acquiring those inputs. The performance of supply management departments and supply management professionals is commonly measured in terms of amount of money saved for the organization. However, managing risk is one of the other critical aspects of supply management; especially the risk of non-availability at the required time of quality goods and services critical for an organization's survival and growth. Supply management: is different from
  10. 10. supply chain management, though it can be considered a component of supply chain management. Conversely, where the supply management function is established as a C-level strategic effort, supply chain management is but one component of an overall strategic supply management approach. Supply management is a complementary discipline that encompasses the alignment of organizations, processes, and systems for strategic sourcing, contract management, supplier management, spend analysis to continuously improve global supply for best-value performance in support of the strategic objectives of the business. Concepts of facilities needed for sound operation of training institutions Facilities-Something designed, built, installed, etc to serve specific function affording a convenience or service. Example, transportation facilities, education facilities, new research facilities. Something that permits the easier performance of an action, course of conduct, etc: to provide someone with every facility for accomplishing a task. Q. 2. Rationale for using it: the fundamental reason, logical operation of supplies and materials. Negessie (2007:51-52) stated that, acquisition of resources unless supported by some procedures will create ineffective utilization of college resources. To this effect, college dean together with his teaching and non-teaching personnel creates a guideline to serve, as a mechanism is the effective utilization of resources. The training materials such as textbooks, reference books, maps, globs, laboratory equipments and other materials are requested by the college dean and procured by the book stores for allocation. To request and procure the materials ahead of time determines the awareness and the efficiency of the college dean. The procurement of training materials largely depends up on the ahead of time demand of the college dean. In other words, the dean determines the kind and amount of instructional resources. The determination is accompanied by mechanisms that can be applied for proper usage. For example rules and regulations of handling and managing resources would determine the store house where they are carefully placed and they‟re by ascertaining the responsibility of the teaching, non teaching, trainees etc, for effective utilization of college resources. All these precautions have taken ahead of time to ensure the effective teaching learning by effective usage of college resources. To request and procure the materials ahead of time determines the awareness and the efficiency of the college dean. In Ethiopia, every institution has developed its objectives which are applicable in minimizing cost through material requirement plan, effective store management, develop effective purchasing techniques and encourage securities to attain the goal. All materials in TVET institution may be managed according to supplies management policy, rules and regulations. Materials such as machineries, tool, textbook, radio, TV and equipments served for along period only when materials are properly managed and use the guideline based on the educational policy of the country. Policy, rules and regulations are also essential for materials management activities to undertake in government TVET institution. Despite the problem of
  11. 11. purchasing unnecessary materials and political assign of the dean possession. without exposition of the discipline but the policy said, the possession dean are merit bathed. Moreover, Sherlekar and others (1998) also describes that material management and control can make necessary arrangements to ensure supply of proper quality and quantity of all materials as and when needed in the process of production at a minimum cost. It is also look after storage and inventory control. TVET institutions might be practiced to develop the technique of cost minimizing objectives through developing good inventory control system, decide the level of inventories and create smooth relationship with suppliers and follow up order. Facilities management is an integral part of the overall management of the training institution. The actualization of the goals and objectives of education require the provision, maximum utilization and appropriate management of the facilities. Furthermore, advances in science and technology, necessitate that the school manager should adopt modern methods of facilities management. This will improve the quality of teaching and learning. A direct relationship exists between the quality of school facilities provided and the quality of the products of the school. The physical environment of a school is a major determining factor in the attainment of its objectives. School facilities consist of all types of buildings for academic and non-academic activities, equipment for academic and non-academic activities, areas for sports and games landscape, farms and gardens including trees, roads and paths. It also includes furniture and toilet facilities, lighting, acoustics, storage facilities and packing lot, security, transportation, cleaning materials, food services and special facilities for the physically challenged persons. Research findings indicate that students learn better when a combination of methods and materials are employed during teaching. Furthermore, emphasis had shifted towards giving individual attention to students as against teaching large classes which presupposes that all students in a class have the ability to learn at the same pace. The implication of this is that in designing school plant, provision should be made for individual and small group interaction and for large groups for academic and social activities. Schools can have multipurpose facilities used for academic activities during school hours, may be available for community use during or after school hours. Such facilities may be used for continuing education programs, social activities and recreation. Through appropriate scheduling multipurpose facilities may be accessible to the community during school hours By coordinating these schedules, managers control the flow of materials, also within the text Dobler and (1985) in the fundamental parts of in particulars principle parts of the text because every organization can use as a goodliness of them. Hence, the following rationales prepared and presented as follows. It is impossible to run a high- quality, low-cost business operation without satisfactory supplies: consequently, one of purchasing paramount responsibilities is to establish and maintain a satisfactory group of supplier oriented actions. 1. Reward and motivate satisfactory suppliers, 2. Eliminate unsatisfactory suppliers, and
  12. 12. 3. Develop new suppliers. Every industrial enterprise has two primary sources of supply-the firm itself and outside suppliers. Management creates the internal source by a capital investment in personnel, machines, materials, and management. It purchases the services of the external source as a supplement to its own internal capabilities. Both sources influence a company‟s success. The first decision to be made in selecting a source of supply is to determine whether the source should be the company itself, or an outside supplier. The second decision, the make-or-buy decision, The importance of good suppliers source selection, a major responsibility selecting capable suppliers one of a purchasing manager‟s most important responsibilities. If the right supplier is selected, then competitive pricing, reliable quality on-time delivery, good technical service, and other goals of good purchasing are more likely to be achieved than if only a mediocre supplier were selected. After a competent supplier is selected, however, the buyer still has work to do! A supplier must be motivated, assisted, and periodically evaluated. Supplier relations: business has long recognized that customer good will is a valuable asset. In fact customer good will has legal recognition, and it is carried as an asset on many company balance sheets. A company develops customer good will by selling acceptable products at affair price, supported by good service with the customers‟ interests in mind. It develops supplier. Factors in supplier selection: how are good suppliers identified? Where do buyers begin to search to find the suppliers who can serve their company best? What problems must be solved before the search for a specific supplier begins? A buyer must consider many factors in selecting sources of supply; this selection of the chapter investigates two primary areas of concern characteristics of the supplying markets, and acceptable ethical practices in these markets. These are the area most buyers consider before getting down to more specific factors of supplier selection. Assurance of supply: reliability of supply is becoming increasingly important to both buyers and suppliers. Hence, suppliers who suffer recurring shortages themselves must be used with great care regardless of their other desirable capabilities. Suppliers who have assured, long-term sources for their raw materials and component parts should be favored and developed. Recurring worldwide scarcities of materials seem certain to make assurance of supply a continuing problem that will become even more important in the future. Size of suppliers: some purchasing authorities theorize that size of an order should correlate with the size of the suppliers receiving the order. For example, a small annual volume of perhaps $10,000 would be placed with a small company. A large annual volume, say $ 250,000 or more, would be placed with a large company. By following this procedure, a buyer increases the probability of being an important account to his or her supplier. At the same time care must be taken not to overload any single supplier.
  13. 13. Number of suppliers: determining the number of suppliers to use is always difficult. Should one or more suppliers be used? The argument for placing all of a firm‟s business with one supplier is that in times of shortage, this supplier will give priority to the needs of a special customer the best pricing because of assured, repetitive sales. Additionally, suppliers may be justified when; 1. The quantities to be purchased are small, 2. The suppliers hold critical patents, 3. They offer lower freight rates, 4. They give exceptional discounts, or 5. They agree to carry the buyer‟s inventory (stockless purchasing). On the other hand, if buyers use two or three suppliers, the purchasing firm will be protected in times of shortage by in such volume that they can always receive excellent pricing and service from two or more suppliers. Similarly, during a glass strike, all automobile companies that were rising glass from a single source were forced to discontinue the use of tinted glass in their automobiles. One major corporation was forced to close its entire assembly line for lack of glass, tinted or clear. An independent automobiles manufacturer, however, had been consistent buying some of it‟s glass from a Canadian source as well as from its traditional united states source. If the suppliers with the larger portion of the business does not perform to the buyer‟s expectations, the distribution can be adjusted to give more business to the company with the smaller share. Developing sources of supply: in some cases, a buyer is not able to select, but must create a satisfactory supplier. If existing suppliers cannot satisfy a firm‟s needs, a supplier must be created who can. The essence of the legal restriction is that under the Sherman and clayton antitrust acts, firms that attempt to monopolize, to substantially lessen competition, or to create unfair methods of competition can be punished Buying locally:- Sometimes community relations require greater use of local sources than could be justified solely by economic factors. Local buying can frequently be justified solely on an economic basis. A local supplier can often furnish smaller quantities of materials at lower prices than could be obtained from distant sources. Buyers should give careful consideration to both the advantages and disadvantages of buying locally and buying nationally. In those situations where economic of local sources, it is the policy of most companies to by locally. Buying internationally: - Foreign purchasing considerations, the reform, can differ for each individual firm. Professors Aarry D.avis and Gary Eppen of the university of Chicago &, in their research study, sought to determine if any commonalities exist in the unique foreign purchasing considerations thought to be most important by different types of firms. Their
  14. 14. research identified seven strategic factors that are common among all firms engaged in foreign purchasing. Consequently, when considering foreign purchases, the seven factors noted below should be carefully evaluated 1. Product categories, International purchases of raw materials involve considerations different from those involved in purchases of components subassemblies, and operating supplies. 2. Distance between supplier and buyer. The greater this distance the more difficult it is to get satisfactory service and economical transportation. 3. Government policies. Government regulations and trade policies frequently make international purchasing un economical or impractical. 4. Nationalism. Some buyers are totally prejudiced against making any foreign purchases. 5. Marketing pressures. Firms frequently differentiate their products to be sold in foreign markets; thus, domestic firms wanting these products are forced in to foreign purchasing. 6. Supplier industry characteristics. Some suppliers are so powerful economically that they are capable of forcing economically that they are capable of forcing their customers to deal with domestic suppliers. 7. Buying firm characteristics. Some firms grow so fast that outgrew the resources of domestic suppliers; thus, they are forced to use foreign suppliers. Manufacturer or Distributor: - in deciding whether to buy from a manufacturer or distributor, a buyer‟s considerations should focus largely on the distributor‟s capabilities and services, not on his location. It is not his location that is important rather it is the functions he performs. Byers should be aware that distributors stock many manufactures‟ products. Hence, ordering from a distributor can significantly reduce the total number of orders a buyer must place to fill some of his materials requirements. If there were no distributors, orders for production as well as MRO (maintenance, repair and operating) requirement would increase directly with many different manufacturers. This obviously would increase direct purchasing costs. Furthermore for every additional purchase order placed and additional receiving inspection and accounts payable operation is created. In the final analysis, the manufacturer- distributor decision centers around one critical fact. The functions of distribution cannot be eliminated. The buyer needs most of these functions, therefore it should pay for them once, but he should not pay for them twice. Either the distributor or the manufacturer must perform the essential distribution function of carrying the inventory, giving technical advice rendering service extending credit and so on. The buyer mast decides for each individual buying situation how he can best purchase the functions he needs. The ultimate question that buyer must answer is: - Is it my company, the required services of distribution satisfactorily at the lowest cost?
  15. 15. Miscellaneous considerations: - By the very nature of business, managers move up the executive ladder frame functional to general management positions. Competent buyers seek out suppliers having management orientations that best blend with the require emends of their own firms. In selecting suppliers, buyers also should consider the seller‟s general product mix and the types of markets he serves. These factors should fit well with the needs of the buyer‟s own company. How do the supply curves of the seller match the demand curves of the buyer? Would a long-terms relationship be economically beneficial to both? Clearly, a buyer seals positive answers to such questions. Conflicts of interest: - in selecting suppliers buyers must be aware of potential conflicts of interest. A conflict of interest exists when buyers must divide their loyalty between the firm which employs them and another firm. In purchasing, this situation usually occurs when he or she makes purchases from close friends and relatives. The subjects is introduced here solely to remind the reader that such conflicts should always be avoided diligently in all source selection decisions. Ethical considerations: - Buyers should keep themselves as free as possible from unethical influence in their choice of suppliers. It is very difficult to maintain complete objectivity in this matter, for it is only human to desires to favor one‟s friends. On occasion friends can make unusually good suppliers. They will normally respond to emergency needs more readily than supply respond to emergency needs more readily that suppliers without a strong tie of personal friendship. On the other hand, buyers tend not to discipline and reprimand poorly performing friends to the same degree as they do other suppliers. Gifts which are intended to influence buying decisions have no place in a professional purchasing department. In most states commercial bribery is a criminal offense. Lun chess with salesman are not customarily considered gifts for the purpose of influencing decisions. Traditionally, they are judged to be a means of providing more time for the buyer and seller to discuss business problems. Beyond this point, the issue of undue influence maybe raised. It is for this reason that many companies prohibit their buyers reason that many companies prohibit their buyers from accepting any gift beyond a simple meal. Regarding meals, firms should provide expense accounts for members of their purchasing departments. This permits buyers to reciprocate with salesmen in paying for lunches, thus eliminating any suspicion of undue influence. Dishonest suppliers: - it is sellers exist in the industrial world Justas they do in the consumer world. This may surprise some readers for it is logical to assume that dishonest suppliers would not tackle experienced industrial buyers, but they do. Dishonest suppliers, therefore, can be a problem in source selection. A recurring technique used by
  16. 16. dishonest suppliers is to contact a buyer by telephone; usually stating that the buyer has been referred to them by a top corporate executive commonly one who must liquid ate the family stationery business immediately. The entire inventory of office supplies is offered at very low prices. If the buyer takes the offer, and many do, the result is always the same: poor quality, high prices and late delivers. What can buyers do it they are swindled by a dishonest seller? From a practical standpoint, in most cases, they have little legal recourse, but they should attempt to expose such sellers to nearest government inspectors. General Inspection: - Quite naturally, no organization can afford to accept materials that do not measure up to the quality requirements and this must be ensured at the entry point.  The final acceptance of materials will be only after they have passed the quality test.  They cannot be taken in to stock or for consumption, unless they pass the lest. Therefore, technically the procurement action is not complete until the inspection is over, i.e. the lead time is partly dependent on inspection.  General visual inspection should not cause any problem,  Quantity inspection, however, can be fully made by the stores personnel  Measuring instruments like weighing scales, reasoning vessels for volumes, ratio balances for counting components etc.  Coordinating with inspection and quality control personnel is a major activity of the stores personnel, The Audit: The audit assessed the effectiveness, economy and efficiency of the department‟s asset management of government school buildings. To address this objective, the audit examined: The planning processes used to determine investment and maintenance actions and maintenance actions and priorities The implementation and monitoring of those actions once committed The evaluation of asset management actions and the processes used to translate the results in to an improved plan. Managing government in school buildings: planning, maintenance and renewal. Storage, access and retention Financial summaries and ledgers should be kept in the school management office together with all supporting documents such as receipts, invoices, bills and payment records. Access to financial records is restricted to the school manager, the school accountant or the school staff member who is in charge of finance and to the financial auditor during school audits. Financial
  17. 17. summaries can be produced on a periodic basis and made available to the school management board and higher levels of the education administration. All financial records are to be kept at the school for a minimum duration of 5 years, but some countries require financial records to be kept Q. 3. How these facilities are determined for each area of specialization? Facility management refers to an integral part of the overall management in schools where actualizations of objectives are achieved through provision, maximum utilization and management measures. Dynamic advancement and socio-economic setup brought about changes in the philosophy of education, enrollment rates, systems of delivery etc. which calls for modern school facility management emphasizing innovative approaches. Researches indicate that the physical environment of school affect the quality of academic and non- academic performance of students through their role in satisfying the physical and emotional needs. Current trend recommend combined management of materials and methods serving both individual and group interactions in academic and social perceptions as part of the process. School facility management is a process that ensures the utilization of the buildings and the technical support to the appropriate operation of the teaching learning process where as school management refers to the application of scientific methods in the process Concept, nature and types of school facilities: - School facilities are material resources provided for staff and students that optimize the productivity of the teaching leaning process. The qualities of the products draw direct relation with the resources deployed in the production process. The types of resources to be advised buy planners and managers include those areas characterizing engineering aspects, behavioral sciences, communication and public relation aspects, tools like ICT, equipment utilization and management urban planning, etc. From the above approach we can see that school facility management is a collective responsibility of the federal, state, local government unity, staff and students of the school, and the community at large. The school plant is the major component of facility management where the curriculum finds its physical expression where design set ups starts by the conceptualization of the educational program. School plant matters not only in memorizing but also in the process of knowledge development. Multipurpose application enables the practice of costs effectiveness, promotes the modernizing and renovations, and the separate managements techniques that increase utilizations efficiency. The use of various types and nature of equipments and increasing demand in use of appropriate management calls for the ICT application where school managers require continuous in-service trainings for upgrading.
  18. 18. TVET institution or college Facilities is determined by the capacity in terms of their purchasing power in anther words determined by finance to fulfill the entire material demands of TVET. Hence, adequate fund is always a problem for TVET center. It is necessary for the manager to look for alternative means of sourcing for funds within and outside the community Government subvention and funds from all forms of fees and Levis are usually inadequate. According to the educational facilities laboratories (1955, p.112) the following  Selecting the best architect and professional advice before buying site.  Eliminating waste space, especially in corridors, boiler rooms and other non-instructional areas.  Using out-of-doors areas where possible.  Using a short, simple perimeter to reduce expense on exterior walls.  Simplifying detail and using repetitive modular building elements where possible.  Carefully selecting building materials.  Using movable partitions to reduce future remodeling costs when alternations are needed to keep the building from becoming obsolete.  Using space flexibility.  Including foundations designed for imposed loads.  Using wheels that can be moved to subdivide space.  Considering acoustical problems.  Considering quality and quantity of light.  Avoiding over design (more capacity than needed) in the heating system.  Consulting with an insurance agent during design.  Using building alternatives with moderation.  Avoiding confusion of cheapness with economy.  Keeping in mind the purpose of everything that goes into the school house. Educational institution lack qualitative and quantitative information on facilities, nature of present use and possible future use. Qualitative data involves room configuration, ventilation systems, windows, lighting, and access to support facilities, condition of furniture use. Qualitative data involves room configuration, ventilation systems, windows, lighting, and access to support facilities, condition of furniture, and space for equipment including specific discipline related requirements. Data collected and analyzed should form the bases for facilities management decision making. In general educational institution facility should include libraries, cafeterias, clinics, toilet, pedagogical center, class rooms, workshop, meeting hall, conference rooms, offices for administrations, other department head offices e.g. ICT department, finance department , trainer offices, stores office, janitors rooms, college guards rooms, etc. Therefore, if science studies are to prepress, schools should be supported by laboratories which contain educate facilities and materials. Although the in availability of any one of the school
  19. 19. facilities affect quality of education, it is hardly possible to imagine teaching learning process to be carried out in the absence of classroom. Therefore, one of the variables to which a great deal of attention has been devoted, is class size. A class is a group of pupils‟ who follow one class of a teacher at the same time, normally one section makes a class. Class size is useful in organizing teaching learning process, assessing laicization and in assessing quality indirectly. Many countries significantly expanded access to primary education during the 1990‟s, but the building of new school has often not kept pace with the increase in the student population, (UNICEF, 2000). In these cases schools have often had to expand class sizes to accommodate large number of students. Now these poorly taught students go to education which would result in poor achievement. There is a general feeling among educators that class size is a crucial variable, and that educational output can always be improved as class size is reduced. Although generally speaking most researchers, teachers and students prefer small class size for effective teaching learning process the number of students in a class vary from country to country and from one subject to the other. Cohn and Ressmiller (1987) state that there is no optional mode employed the individual students and the degree of students‟ mobility. However, according to Douglas (1954) class rooms should be continent enough for students to learn comfortably so he has suggested that since there must be sufficient space between students with in the class, the typical class room should not accommodate more than 35 to 36 students. In countries in which the average class size appears to be in the 35-45 pupils ranges, it is considered about right (World Bank, 1988) substantial evidence from research supports the proportion that with in broad limits (between 25 and 50 pupils)changes in class size influence pupil achievement modestly or not at all. But since most classrooms are not designed for more than 50 pupils, and since discipline can be a problem, classes larger than 50 pupils should probably be discouraged in general, effective teaching learning process takes place in a relatively small class size better than the large one (wade,1980). Although effort is usually made to measure average class size for the most part, greater emphasis has been placed on the ratio of teacher to students. Citron and Gayle (1991) suggest that for students to get the education, low student teachers ratios is required that could hiring more staff. Then they argued that academic performance rise quickly, and droop out rates fall. Pupil teacher ratio is believed that the less the number of pupils per teacher, the higher the degree of contact between pupil and teacher. Lower number of pupils per teacher, is considered a positive indicator of quality (Tagen Nuresu, 1998) Need for facilitating schools: - School facilities are materials which serve specific purpose in the teaching and learning process. They used to play direct and indirect roles emphasizing the satisfaction of the physical and emotional needs respectively. Facility management relations:School facility management needs a collective effort which involve in the process of management like planning, organizing, coordination, leading and controlling. So demands the involvement of various stake holders with new ideas and methods. With the increase of academic
  20. 20. programs due to increased enrollment rate and limited resources, planning emphasized of the concept of flexibility where effective functioning of flexible planning take the lead. Methodologies for facility management: - School facility management is a collective involvement of various stake holders including the government elements. The planning target is directed to the development of knowledge based economy bearing the ultimate propose of educational to be serving of individual life in sustainable manner. The second direction is provision of objectives and specific goals flexibly satisfying individual and precise school auditing activities which provide information exploitable for various purposes. In this regard the stages of facility managements responsible for the systematic accomplishments are categorized as analysis phase, solution phase and implementation phases where the gathering and organizing, strategic setting and action plan development are conducted respectively. Information and communication technology:- A school, as a formal organization, need to be provided with timely, efficient and relevant information that helps for understanding and decision making of the past, present and future anticipations. So the gathering, processing and dissemination of information in current times use the application of information and communication Technology (ICT), that is technology based and knowledge driven applicable for interactions and researches. Through stages of technologies and their applications, ICT helps for the systematic processing and supplying of meaningful information to the end user. By doing so ICT appraises, signifies, reduce uncertainties and stimulates individuals for action. We can use as a means of income generating activity in the school facility. Facility maintenance: - Facility maintenance is among the over looked issues in school management. It helps for modernization and renovation of buildings with prolonged service years and due to obsolescence. It is an integrated process involving all aspects and levels. It entails in providing clean environment and adequate school facility. The types of facility maintenance are classified as preventive, routine, emergency and predictive. Problems and issues related to facility management: - the lack of policy guide line regarding the infrastructure of schools is a fundamental problem and also managers assigned by their political view than relevance of educational background (by his or her supporter alone than knowledge). So development issues of the government need to include standards of facilities. Currently policies, as authoritative communication among positions, required effective participation of stake holders including the school community for economic successes Professionals. So school mangers need to be skilful in terms of mobilizing various human resources. Finance:- Adequacy of finance is a common problem in the process especially in government schools. Therefore beyond the focus on alternative funding, reduction of facility management costs need to be considered. Information: - Lack of qualitative and quantitative information in
  21. 21. schools limits managers from clear undemanding of facilities in terms of physical and emotional values. Therefore collected information should be analyzed in the forms which can serve as basis for decision making. Facility management gives meaning to the teaching process. It is an integral part of the overall school management process. There school managers need to conduct comprehensive assessment there by identification of problems and efficient coordination of stake holders could be effective. Actualization of educational objectives demands the provision, maximum utilization and management of school facilities‟. The advance in science and technology call for the use of modern facility management scheme which results in the quality of the program. A. The current implementation of similar programs resulting rapid change in the education system through strategies of increased rate of enrollment, diverse programs etc. B. The second relevance is related to usage of similar structural set ups of governmental units as federal, state and local governments as routes responsible for the realization of educational programs. C. The lack of clearly set policies and guide lines regarding school infrastructural developments which is reflected through registered limitations in the capacity of implementing the policies and programs at various levels. D. The less developed scheme of ICT application in the educational system regarding school facility management E. Little or no developed custom or even concepts of facility maintenance management F. Lack of concepts and skills of school facility management by the managers of the school G. Conducting appropriate and sufficient assessment regarding the problems related to the development of effective school facility management schemes. H. Preparation of clear and justifiably set policies regarding school facility management which states the philosophy, objectives, relevant programs and the corresponding facilities require with the responsibilities of every government units and other stake holders. Followed by the dissemination of it aiming at creation of awareness, attitudinal changes and program understanding I. Giving much emphasis towards the improvement of stake holders like private institutions participations including school communities J. Developing strong application scheme of ICT applicable for the school facility management K. Conducting upgrading trainings for the school managers and others working within the system regarding school facility management L. Promoting school facility maintenance planning in the annual budgets of schools M. Conducting applicable research regarding the roles of Scholl facility management in schools
  22. 22. N. Exercising the development and implementations of appropriate school facility planning with in the schools. Shiromeda junior level technical and vocational training institute is my focusing area to observing and assess the current status of it their guidelines of governing their institution. The institution has heavy equipment, very reliable and expensive training materials. It has five training occupation areas. These are: Metal manufacturing (fabrication), Construction, Electricity, Plumbing, Carpentry and painting, and Leather goods technology Notice: that carpentry, painting and plumbing are now under the construction department since 2005 E.C now I realized that the metal manufacturing comprises the following machines in its field areas, fifteen welding machines, ten drilling machines, and fifteen gridding machines It has also different hand tool materials during my visit, in the institute, I got the chance to see the construction department carefully and interestingly in which there are heavy and so expensive machines. There are five mixer; four vibrators and tedolight machines. They’ve been functional for training purposes I got what I have been asking the trainer. In relation to usable materials utilization, the institution has only one store keeper. In the store, by using government procedure I saw; 1. Receipt for articles or property received (model 19) 2. property issued (model 22) 3. Material requisition (model 20) By using these models, the department head asked the training coordinator collect the information for each dep’t the training coordinator examined the request and directs the demand to the store keeper if the equipment are available or to be given by signing. Therefore, the department head received the articles accordingly and put in mini-store and the materials and used by the trainees they are also the custodian what they received. During my visit, I realized some problems in the institution to administer. Among these , there is no a tool person, the workshops are not enough space /not wide/ for practical teaching learning processes although the construction manufacturing had different shops like, pipe, electric, painting and decorating workshops. In fact, the metallic fabrication way proper and handy to demonstrate forges and, there is miss use of materials: according to market demand. The leather technology department more complete than other department because last year they employed trainer both leather garment and shoes making trainer the work shop of leather department is well equipped machines even more than other junior
  23. 23. level training institute even more than that of TVET colleges. But the problem is due to electric installation, and the proper arrangement of electric power the department is not functional at this time. Accordingly the institution states source of funds among other problems as follows; Government allocates for this fiscal year 1,526,076.00Et. Birr as a budget out of this for equipment 585700Et. Birr, allocated , current expenditure 688,019.00Et Birr for teacher salaries and staff salaries, The TVET source of funds significant amount of money from NGO as source of fund both for capital budget and purchasing equipment, also for capacity building of trainer, trainee and staff. There is no purchasing department like that of others TVET college, Until know raw materials and other facility for training purpose can‟t purchase hence, training can‟t undertake till now. There is no purchasing and maintenance department purchaser works one person under finance undertakes the department work also maintenance work also responsibility for all educational department. There is no enough store rooms because of this materials equipment, machineries and other trainers production of materials discarded and exposed to light outside the rooms. The training institution didn‟t have the shortage of work- shop equipment since the world vision supports precious and enough training materials besides the government budget allocation. The donor World vision built G+1 for training purpose, it holds administrative office, two workshops rooms and three class room built by the world vision the ongoing building is G+4 which want to broaden & opening the new department including ICT. Constriction department trainee built last year one room for campus café wood wore department make internal equipment for the café service plumbing and electricity departments also takes part their works. They are not use as a manual make or buy decision as material management objective because the managers which administrate the institute are not trained in MPVE (managements of professional and vocational education) Concerning to administrative function pipe water, telephone service are available. Even though, in administrative and academic departments there is no computer, printer, scanner, photo copy machine and other important equipment. During my visit, office works perform their work by manually. Some of the standards of training facilities at list must holds in the next topic for each specialization areas: Facilities are material resource provided for trainee and trainer to ease teaching learning process and optimize their productivity in teaching and learning. But for each TVET department should be fulfilled among from those heavy equipment to lower hand tools, i.e. from 20 broad department I select 9 department such as,
  24. 24. A. FOOD AND BEVERAGE SERVICE DEPARTMENT, Food preparation, Baking, Hotel management, Housekeeping and laundry service, Tour and travel operation, Tour guiding service, Tourism management, F&BSD kitchen facility oven, wall cabinet, (cupboard) kitchen knife, bread knife, toaster oven, coffee maker, dish, double boiler, (steamer), kettle, roaster, griddle, egg poacher, casserole, soup pot, soup oven, electric wane iron, meat grinder, kitchen scale, garbage cap, cutting board, etc… B. GMF (general metal fabrication)machinist, machine ration manufacturing workshop facilities: include rolling machine, binding machine, gas welding, lather machine, bench girder, welding machine, forging, seaming machine, circular shear, pedestal girder, drilling machine and heat treatment furnace. Hammer, chisel, punch, meter and tri-square… C. Construction department includes masonry, concrete, carpentry, painting Construction workshop facility: include harmer, shovel, pick axe, mallet, metal plot, tulle cutter, zigzag rule, trowel, hacksaw, tape rule, HCB mould, floor tile, palm bob, building model and different partitions. Square meter, shaper, hammer, mixer, vibratory, gravel, water balance, etc. D. Wood work shop facilities: combination machine, robed machine, Makita, saw, painting brush, smooth and round file, screw driver plat, drawing instrument, and portable hand plane machine etc E. Electricity Workshop facilities: including equipment and devices, distribution board, wire, switch, fuse or steelier, blast, breaker, transformer, bell, lamp, resistor, test light, plastic harmer, boll pin harmer, digital multiplier, timer, realer and Varner caliper….. F. Automotive workshop facilities: include driller, model car produced by students and other machines…. G. ICT lab facilities: computer, laptop, broadband networking device, etc….. H. Leather fabrication facility (leather goods and garment): materials are, hide and skin, frames, salt for preservation, leather singer, and other accessories like needles cutters, papers and plastic (syntactic leather for training) etc……. I. Textile technology facility: singer, the materials are singer, different clothes for learners practice singer‟s needle papers and cloth for training etc.. In addition to these, for all TVET departments should be provide different equipment facility such as, classroom desks, classroom chairs, teacher desks and chair Blackboard, whiteboard, cupboards, open shelves, etc. Equipment, Telephone, calculators, photocopier, computer, printers, projectors, scanners, radio, TV, DVD, Science equipment, Language equipment, Art and craft, Sports equipment, etc. Q. 4. Current states of these in the institution you are working on,
  25. 25. Current educational systems in Ethiopia are showing tremendous changes at all level of education in terms of broadening education institution by building new school; vocational institution and university accommodate the facility of material fulfilling the demands of institution, both in privet and government school. But the quality, efficiency and a number of equity problems in the regional government in Ethiopia, of vocational education is not much changed because lack of modern technological equipment, lack of teacher qualification and professional development, allocation of management in the TVET without exposition of the discipline, the curriculum which provided in TVET are not market oriented, lack of financial budget for the training observed both in TVET institution and TVET college and delay of the allocated budgets offering on the due date for the training session. In addition to the above problem mentioned, Most of the problems observed only in the basic level TVET institutions are as follows no more guidance and counselor with other staff personnel which demanded in their organizational structure even the assigned person have no exposition and trained on the discipline, also at basic level of TVET institution there is no procurement and supply management department. In both TVET College and basic level TVET institution commune courses are not offer (English, mathematics are phase-out), also business stream is phase-out in every governmental and nongovernmental organization. Shortage of practical teaching learning place like enough laboratory, library, shed and class room, student and parent negative attitude towards vocational education, there is no proper understanding and responsible body concerning income generating activity only observed in government TVET than in privet institute, no proper material management in government TVET, in academic stream students with high academic achiever are recruited large quantity in preparatory class and they hate the system of TVET knowing and unknowingly. Youth lower work loving condition and hate hard conditions of work and also disgust work ethic of entrepreneur, Lower academic achiever also recruited large quantity, and due to this they hate vocational streams instead of understanding to be the future entrepreneur and become enterprise and big business persona. Because of these the dropout rate is also high. Redie Agedew (1977) also taught us it is better to acquaint career development at early age starting from 14 to 18 instead of identifying their talent and telling later year. According to Redie Agedew (1977) wrote in his research work and dissertation career occupational structure more employees needed in starting from unskilled, semi skilled, skilled and middle level professional etc in the hierarchy order respectively. Ato Girma Zewdie associate professor also provides for us several teaching material and his research study concerning youth Vs adult venerability in terms of economic benefit and employment and self employment. He gave as several assignments on every issue of TVET field of study practically and theoretically, individual and group assignment accordingly, 1. Theory and practices of managements of vocational education, 2. Project planning and financial management in vocational education, 3. And the ongoing course it said to be supplies and property management in the managements of vocational education. Hence, he gave for as leadership style to overcome
  26. 26. the above mentioned problem which existed in the TVET institutions. When we observe the opportunity of preference from all occupation should left to the individual talent need alone in our country more people are interesting to join university forced by their family, friends and by their own choice for long term education to get knowledge rather than making money is their moral behavior, in other words some people are interesting to join TVET programme to get testimony of practical work accreditation relatively short period of time they will become entrepreneurs can making money. Indeed the preference should left to the individual person, in order to fulfill their student demand it is better join vocational education after acquainting world of work getting income satisfy themselves and if they want, they can resume either academic field of study or engineering courses instead of recruiting university graduates obliges to join unskilled demanded possession. The government should provide a chance media coverage for social acquaintance for better self employment. The forwards of this study I will summarize in the recommendation at end parts of this study. Currently my work at woreda level implement the new government policy it said to be Kaizen in the enterprise with the collaboration of Entoto TVET college. the enterprise (entrepreneur) which found at a grass root level kaizen mean Word Origin of KAIZEN改Kai): Change, amend, reform 善zen): Good, right, virtue The original meaning of KAIZEN is “change for the better.” KAIZEN is “a Japanese business philosophy of continuous improvement of working practices, personal efficiency, etc.” “KAIZEN is a collective term of productivity improvement, TQC, ZD, Kanban, suggestion system etc. under the thought common in philosophy, organization and problem-solving. KAIZEN is customer-oriented and stresses on continuity, process and workplace.” abstract from “KAIZEN” authored by Masaki Imai cite: Oxford Dictionary Continuous improvement is the improvement that repeatedly conducting problem-solving or issue achievement after identifying problems or issues, including tool arrangement which found in their shop and workshop, material management. Increase in profit Enhancement in competitiveness. Increase in customer satisfaction Increase in wage Job generation Increase in payable tax → Contribution to National finances Enhancement of resistibility to business depression Inter-industry synergy effect KAIZEN is an important pillar for the National Growth Strategy. The objective of Kaizen improving their production and productivity by changing their traditional forms of production to modern production flow identifying staff performance record identifying worker improvement / success staff problem within the enterprise it includes identifying skill gape by need assessment and fill the gape what we identified, example preparing their business plan, accounting and ledger shits, material codification which found in their stores opening file and folder cabinet i.e. filling the gape including practical skill gape example metal work, leather technology and cloth production etc… Most Ethiopian government institutions and all private institutions like, education, hospital, factory and industries are highly look for their purchasing and materials management practices also focus on their purchasing objective and strategies to effectively run their operation despite
  27. 27. some problems of production material handling and quality maters of purchasing material, buy from the right source, purchases quality materials, at the right time, the right quantity. Accordingly, I am working within City Government of Addis Adada TVET agency at woreda level starting from December 2011 indeed as TVET trainer from 1996 until 2003. During my working time I got information about supplies and material management system particularly purchasing system. Hence, to intensify and acquire knowledge through interview methods. A.A. city government TVET agency in terms of purchasing all materials for different TVET found in Addis Ababa concerning authority and responsibility. In such away, I have been contacted to Ato Sisay Abrha who is working within A.A. City Administration TVET agency in the post position as Trainers and Training leadership development department head, my first question was who is responsible to allocate the budget for TVETs college and institutions he replied “that Addis Aababa city administration finance and economic bureau allocation and provide budget for A.A city administration TVET agency finance department for responsible entire TVET college and sub cities office responsible for basic level TVET institutions receive the allocated budget both they delegate with full responsibility and authority and accountability to use the allocated budget for both colleges and basic level institutions. Indeed most of the TVET institutions implementation undertake with the rule of government policy”. The budget of TVET not only allocated by government but also donors contribute significant amount of money for TVET example shuromeda basic level TVET institute supported by world vision shromeda branch office last year the provision given accordingly for material which is equipment, heavy machinery (precious and enough training materials), for training purpose it is capacity building of the trainer and trainee, purchasing equipment for the graduates (trainees) from self employment. It Allocate for capital budget. There has been built G+1 building two years before the building commence work currently G+4 building launch this year the project will complete at the end of this year worth 8milion birr. For this year the budget of world vision is not less than 900,000 $ dollar for fulfilling material and for capacity building. Accordingly, the current status the purchasing system both at the TVET College and institution level purchasers they are organized at department level it said to be procurement and supplies takes place by purchasing and plan department. Another information provider from Entoto TVET college Ato Tesfalem Tesfaye work as finance department head I was asked clearly figure it out the entire activity of using the allocated budget for TVET of he replied that, “due to the government policy using decentralization the procurement and supplies management activities undertaken by the departments of purchasing and plan department which is structured in the organizational chart recently in the college in Entoto TVET”. But when we see basic level TVET institution doesn‟t organized at department level they organized under the department of finance within the department one person is responsible to operate the purchasing demands of the department. During the performance of them both TVET college and institution the purchasing practice will work with committees, at
  28. 28. college level they have internal auditor department. The following purchasing when they want to purchase materials in both TVET this purchasing rules govern them i.e. 1. Each department prepares their own purchasing demand plan and submit to purchasing and plan department. Their Annual plan assessed by the finance and management committee and approved and hold fiscal budget. 2. The TVET college purchasing and plan department collect information needs of each department on the TVET. 3. Based on the collected needs of the TVET college and institution announce “invitation for bids” for purchasing the right items from the right source. 4. The tendering committees screen the suppliers (press enterprises) by considering the fair price to supply the right quality in light of ordering by title, and grade level. 5. Those who won and selected as potential supplier, in this case, press enterprises‟ make contractual agreement with the TVET College about when to receive and how to receive the materials. 6. The received materials expected to be checked at the arrival against the invoice. 7. After the received materials are checked and accepted, it is stored in the store house and latter distributed to each department based on their previous need reported to TVET finance department. The material and equipments are handled by the store keeper receipt by model 19 and issued by model 22 and material requisition by modal 20. After all this materials and equipments are distributed to each department from the store keeper and stored in minister and finally utilized as per the principles and the regulation of the college Q 5. Purchasing and associated activities; Purchasing is defined as: the acquisition of required materials, equipments, supplies, and services. It is functions responsible for obtaining equipments, materials, supplies, and services required by an undertaking for use in production by purchase, lease, or through other legal means. It is one of the basic functions to all types of business enterprise and an integral parts of business management. This is because it is impossible for any organization to achieve its full potential without a successful purchasing activity. This is not to imply that all purchasing department one of equal importance to the success of their companies. Their importance varies widely. Purchasing is an important function of materials management. In any industry purchase means buying of equipments, materials, tools, parts etc. required for industry. The importance of the purchase function varies with nature and size of industry. In small industry, this function is performed by works manager and in large manufacturing concern; this function is done by a
  29. 29. separate department. The moment a buyer places an order he commits a substantial portion of the finance of the corporation which affects the working capital and cash flow position. He is a highly responsible person who meets various salesmen, thus, the buyer can make or mar the company‟s image by his excellent or poor relations with the vendors. Some of the major types of purchasing activities are: all activities of buying raw materials, components, finished goods, or services,. Identifying, purchase needs with others departments (conducting purchase research),. Identifying potential suppliers and discuss with their representatives. Objectives of purchasing The basic objective of the purchasing function is to ensure continuity of supply of raw materials, sub-contracted items and spare parts and to reduce the ultimately cost of the finished goods. In other words. The objective is not only to procure the raw materials as the lowest price but to reduce the cost of the final product. The objectives of the purchasing department can be outlined as under: To avail the materials, suppliers and equipments at the minimum possible costs: These are the inputs in the manufacturing operations. The minimization of the input cost increases the productivity and resultantly the profitability of the operations. To ensure the continuous flow of production: through continuous supply of raw materials, components, tools etc. with repair and maintenance service. To increase the asset turnover: The investment in the inventories should be kept minimum in relation to the volume of sales. This will increase the profitability of the company. To develop an alternative source of supply: Exploration of alternative sources of supply of materials increases the bargaining ability of the buyer, minimsation of cost of materials and increases the ability to meet the emergencies. To establish and maintain the good relations with the suppliers: Maintenance of good relations with the supplier helps in evolving a favourable image in the business circles. Such relations are beneficial to the buyer in terms of changing the reasonable price, preferential allocation of material in case of material shortages, etc. To achieve maximum integration with other department of the company: The purchase function is related with production department for specifications and flow of material, engineering department for the purchase of tools, equipments and machines, marketing department for the forecasts of sales and its impact on procurement of materials, financial department for the purpose of maintaining levels of materials and estimating the working capital required, personnel department for the purpose of manning and developing the personnel of purchase department and maintaining good vendor relationship.
  30. 30. To train and develop the personnel: purchasing department is manned with varied types of personnel. The company should try to build the imaginative employee force through training and development. Efficient record keeping and management reporting: paper processing is inherent in the purchase function. Such paper processing should by standardized so that record keeping can be facilitated. Periodic reporting to the management about the purchase activates justifies the independent existence of the department. Objectives of procurement system • Acquire needed supplies as inexpensively as possible, Obtain high quality supplies, Assure prompt & dependable delivery, Distribute the procurement workload to avoid period of idleness & overwork, Optimize inventory management through scientific procurement procedures
  32. 32. Earnest money: 2 % of the tender amount or as decided has to be paid along with all quotations. In case of default 1/5 is withheld Restricted or limited tender: From limited suppliers (about 10), Lead-time is reduced, Better quality Negotiated procurement: Buyer approaches selected potential Suppliers & bargain directly, Used in long time supply contracts Direct procurement: Purchased from single supplier, at his quoted price, Prices may be high Reserved for proprietary materials, or low priced, small quantity & emergency purchases Rate contract: Firms are asked to supply stores at specified Rates during the period covered by the Contract Spot purchase: It is done by a committee, which includes an officer from stores, accounts & purchasing departments Risk purchase: If supplier fails, the item is purchased from other agencies & the difference in cost is recovered from the first supplier Points to remember while purchasing: Proper specification, Invite quotations from reputed firms, Comparison of offers based on basic price, freight & insurance, taxes and levies, Quantity & payment discounts, Payment terms. Delivery period, guarantee, Vendor reputation, (reliability, technical capabilities, Convenience, Availability, aftersales service, sales assistance), Short listing for better negotiation terms, Seek order acknowledgement Storage: Store must be of adequate space, Materials must be stored in an appropriate place, in a correct way, Group wise & alphabetical arrangement helps in, identification & retrieval, First-in, first-out principle to be followed, Monitor expiry date, Follow two bin or double shelf system, to avoid, Stock outs, Reserve bin should contain stock that will cover, lead time and a small safety stock Issue & use: Can be centralized or decentralized Parameters of purchasing The success of any manufacturing activity is largely dependent on the procurement of raw materials of right quality, in the right quantities, from right source, at the right time and at right price popularly known as ten „R‟s‟ of the art of efficient purchasing. They are described as the basic principles of purchasing. There are other well known parameters such as right contractual
  33. 33. terms, right material, right place, right mode of transportation and right attitude are also considered for purchasing. 1. Right price: It is the primary concern of any manufacturing organization to get an item at the right price. But right price need not be the lowest price. It is very difficult. The „tender system‟ of buying is normally used in public sector organizations but the objective should be to identify the lowest „responsible‟ bidder and not the lowest bidder. The technique of „learning curve‟ also helps the purchase agent to determine the price of items with high labor content. The price can be kept low by proper planning and not by rush buying. Price negotiation also helps to determine the right prices. 2. Right quality: Right quality implies that quality should be available, measurable and understandable as far as practicable. In order to determine the quality of a product sampling schemes will be useful. The right quality is determined by the cost of materials and the technical characteristics as suited to the specific requirements. The quality is determined by the cost of materials and the technical characteristics. Since the objective of purchasing is to ensure continuity of supply to the user department, the time at which the material is provided to the user department assumes great importance. 3. Right time: For determining the right time, the purchase manager should have lead time information for all products and analyse its components for reducing the same. Lead time is the total time elapsed between the recognition of the need of an item till the item arrives and is provided for use. This covers the entire duration of the materials cycle and consists of pre-contractual administrative lead time, manufacturing and transporting lead time and inspection lead time. Since the inventory increases with higher lead time. It is desirable to analyse each component of the lead time so as to reduce the first and third components which are controllable. While determining the purchases, the The components of the materials purchasing cycles: Nubiya (ND,310) explained that the acquisition of education materials, depending on the operation of the establishment, formulized procedures need to be developing framework. Generally, the procedures used in the purchase system vary depending on the types, prices, volumes of materials purchased or sources such as local or international. The following constitute a typical purchase cycle: 1. Recognition, definition, description, and transmission of the need. The need for a purchase typically originates in one of a firm‟s operating departments or in its inventory control section. If the need is a onetime purchase, then an engineering dill of materials is sometimes used. The point to be considered here is that clear, complete, appropriate definition and description is a joint responsibility of the user and the buyer. 2. Communication (transmit) the need: regardless of the form of transmission used, material requirement must be defined effectively and the most appropriate methods of description should for the situation at hand.
  34. 34. 3. Search and Select qualified suppliers: as soon as the need has been established and precisely described, the buyer begins an investigation of the market to identify potential sources of supply. 4. Prepare and place purchase order: most companies prepare their purchase orders on multipart snap out forms. These multipart forms provide enough copies of the order to satisfy both international and external communication needs. 5. Acknowledgement and follow up of the order: in most cases, the original copy of the purchases order which is sent to the supplier requires a change in the contract. In such cases, the buyer issues a change order following the same procedures as were followed for the original order. 6. Receive and inspect the material: the next step in the traditional purchasing cycle is receipt and inspection of the order. When a supplier ships materials, it includes in the shipping container a packing slip which itemizes and describes the content of the shipment. 7. Checking (auditing) the invoice: occasionally, a supplier‟s billing department make an error in preparing an invoice, or its shipping department makes an in correct or incomplete shipment. To ensure that the purchaser makes proper payment for the materials actually received, sound accounting practice dictates that some types of review procedure precede payment to the suppliers. 8. Analyzing receiving reports and processing discrepancies and rejections. 9. Close the order: the closed order file provides a historical record of all computed purchases. It frequently serves as a useful reference when questions arise concerning part orders and when certain historical dates are needed to guide future decisions. 10. Maintenance of records and files: all the records and files carefully managed and maintained for future information‟s and should be documented properly. Purchasing role in inspection: and to contribute most effectively to the organizational effort, purchasing role in the programme should include. 1. Participation in the development of specification 2. Participation in the selection of appropriate quality control, inspection and test requirements; 3. The selection and motivation of qualified suppliers; and 4. The subsequent motivating and nurturing of the ongoing buyer-supplier relationship. The information purchasers must know about inspection certificate Inspection certificate: An inspection certificate is document normally prepared by an independent entity other then the exporter to attest to the condition, quality or quantity, of goods being shipped. It is requested by the importer as a means of assuring that the goods contracted for are those that the exporter has shipped.
  35. 35. Management for quality ISO 9000 quality standards: The international organization for standardization (ISO) as its name implies, as international, body composed of members representing standards organization from ninety-one countries throughout the world. The objective of the organization is to promote the development of goods and services over the years; ISO has promulgated thousand of standards in the pursuit of this objective. Affirm that adopts the ISO auditor that these procedures are in fact followed in practice. Their guidelines. ISO 9001. Provides a quality assurance model for assuring conformance. Source purchasing and supplies managements (Dobler, 1996). Standardization is one of the factors that affect the selection of instructional materials and supplies. When we select instructional materials and supplies, we should take into account standardization why? Because in general instructional material and supplies have national and international nature. On the other hand when we select based on standard; we can get the materials which are closely aligned with national and state content and pedagogical standards. Administrative Guidelines MATERIALS MANAGEMENT PROCUREMENT GUIDELINES GENERAL PROVISIONS, WRITTEN DETERMINATION, CONFIDENTIAL INFORMATION, MINORITY, DISADVANTAGED AND WOMAN BUSINESS ENTERPRISES, ABANDONED, UNCLAIMED SURPLUS PROPERTY DISPOSAL, MAILROOM AND COPY CENTER OPERATIONS, : SOURCE SELECTION AND CONTRACT FORMATION, GENERAL PROVISIONS, PROSPECTIVE BIDDER‟S OR OFFEROR‟S CONFERENCES, AMENDMENTS TO SOLICITATIONS, PRE-OPENING MODIFICATION OR WITHDRAWAL OF BIDS LATE BIDS, LATE WITHDRAWALS AND LATE MODIFICATIONS, LATE PROPOSALS, MODIFICATIONS OR WITHDRAWALS, MISTAKES IN BIDS, MISTAKES IN PROPOSALS, BID EVALUATION AND AWARD, EVALUATION OF PROPOSALS, PROPOSAL AWARD, RECEIPT OF PROPOSALS, EXTENSION OF OFFER ACCEPTANCE TIME, PURCHASE REQUESTS, ASSIGNMENT OF RIGHTS AND DUTIES, CHANGE ORDER PERCENTAGE, CITY OF PEORIA CONTRACTS, PROSPECTIVE BIDDERS LIST, INVITATION FOR BIDS, ONLY ONE BID RECEIVED, RECEIPT, OPENING, AND RECORDING OF BIDS MULTI-STEP SEALED BIDDING, PHASE ONE OFMULTI-STEP SEALED BIDDING, PHASE TWO OF MULTI-STEP SEALED BIDDING, COMPETITIVE SEALED PROPOSALS, REQUEST FOR PROPOSALS, DISCUSSIONS WITH INDIVIDUAL OFFERORS, BEST AND FINAL OFFERS, SMALL DOLLAR PURCHASES, PETTY CASH PURCHASES AND PROCUREMENT CARDS, SINGLE SOURCE PROCUREMENT, SOLE SOURCE PROCUREMENT, EMERGENCY PROCUREMENT EMERGENCY PROCUREMENT PROCEDURE, COMPETITIVE SELECTION PROCEDURES FOR CERTAIN PROFESSIONAL SERVICES, STATEMENT OF QUALIFICATIONS, REQUEST FOR PROPOSALS, DISCUSSIONS WITH INDIVIDUALS OFFERORS, EVALUATION AND CONTRACT AWARD WHERE PRICE IS AN EVALUATION FACTOR, SELECTION AND CONTRACT WHERE PRICE IS NOT AN EVALUATION Q.6. Replenishment (replacement where applicable); REPLENISHMENT Replenishment is to fill materials again or to get further supplies of a materials and equipment.
  36. 36. The replenishment process in broader sense addresses the business practice to exchange data between a buying party (e.g. buyer) and a supplying party (e.g. seller/supplier) related to the future demand of finished or semi-finished products, ingredients, packaging and raw materials. In fact a replenishment request and a replenishment proposal. Between retailer and manufacturer (the downstream supply chain) the data is basically based on future demand based on finished products and time series but it can also be restricted to actual sales date for a certain period of time. Feed-back from the manufacturer on his availability to deliver is required, where available inventories (of both sides) are taken in account. Between manufacturer and material supplier (the upstream supply chain) the data is basically based on material requirements for production and the timing for it. And also the feedback from the material supplier on his availability to deliver and the schedule for delivery. Inventories (on both sides) are taken in account for the actual delivery schedule. Based on the delivery schedule (replenishment proposal), a transport and shipping planning can be derived. Objectives: In the current gs1 XML standard no XML documents are available to address the replenishment process in a wider scope than the replenishment part of CPFR, which is also only defined for the downstream supply chain. Specific XML documents for data interchange with material suppliers don't exist as well as specific documents for the combined data interchange of sales or sales forecasts and inventories as well as material requirements and inventories. The fact that inventories and even the status of these (like unrestricted, restricted, in transit, blocked, reserved etc.) are of importance also implicates the opportunity of an integrated data interchange including inventory data for a replenishment request and replenishment proposal Besides the external supply chain also the internal supply chain of manufactures based on sales units and factories should be able to use the replenishment XML documents. Anyone involved in the replenishment process with another party in the (extended) supply chain process. These parties basically are retailers, manufactures and suppliers of ingredients, packaging and raw materials. But can also be parties in between like wholesalers or logistic service providers managing warehoused. Business Context Industry: All Geopolitical: All Product: All Process: Plan System Capabilities: EAN.UCC Official Constraints: None Use Case Description Process Use Case Name Replenishment