Material Management, History of Material Management, Functions of Material Management, Scope of Material Management, Aim of Material Management, Objectives of Material Management, Parameters related to Material Management, Activities involved in Material Management, Main departments of Material Management, MPL, PPC, Material and production planning and control, Stores and warehouse, Procurement, SCM Supply chain management, Inventory control, Techniques of Inventory control, ABC analysis, EOQ (Economic Order Quantity) Model, Inventory turnover Ratio, other inventory cost, Types of inventory cost, Challenges of Material Management

1. MATERIAL MANAGEMENT
Kamal Joshi

2. Objectives of the Presentation:
• To explain the concept, aim & functions
of material management
• To understand the activities of main
departments involved in Material
management
• To explore control measures in Material
management

3. Material Management:

4. • Materials management is defined as a concept in an
organization which plans and control distinct materials,
their supply, their flow from the stage of raw materials to
the stage of finished goods and handover goods to
customers as per the needs of customers in right time.
• A scientific technique comprising of planning,
organizing & control of materials from their initial
purchase to their final destination.
Material Management:

5. • Material Management’s concept was used in
WW-I.
• Before World War-I people were unaware of the
importance of Materials Management, Inventory
Control, and Supply Chain Management.
• Establishment of Indian Stores Department in
1922 was the precursor of Material Management
adoption in India.
• In the corporate sector, TISCO was the first one
to establish a central purchase department.
History of Materials Management

6. Scope of Material Management:

7. Functions of Material Management:

8. Important functions of materials management are planning,
purchasing and controlling. The enhanced productivity is its
aim and is used to perform the following:
• To decrease the cost
• To enhance profitability
• In production streamline
• In proper utilization of materials
• In transportation
• In distribution
Aim of the Material Management:

9. • Enhancing sales via sales promotion (Maximization of
benefit)
• Enhancement in service of customers
• Globalization of the sales of product
• Meeting the transformations in technology
• Having a good employer and employee relationship
• Decrease in manufacture cost and other costs
• Objectives of social responsibilities
Objectives of Material Management:

10. Parameters related to materials
management:
Many industries buy the materials and do the following
activities with them in a step by step manner:
• Transport materials into a plant
• Transform materials into parts
• Gather parts into furnish goods
• Sell products or goods to customers
• Transport products to customers

11. • Planning
• Inventory planning
• Purchasing
• Storage
• Inventory control
• Supply of materials
• Transportation of materials
• Handling of materials
Activities involved in Material
Management:

12. Main Departments of Material
Management:

13. What we learned so far.....

14. Material & Production Planning & Control

15. Material & Production Planning & Control Cont.....

16. Material & Production Planning & Control Cont.....
According to Ray Wild,
production planning is
defined as follows:
"Production Planning is
concerned with the
determination, acquisition
and arrangement of all
facilities necessary for future
operations."

17. Procurement:

18. Supply Chain Management:

19. Warehouse:

20. Material Store:

21. Inventory Control:
Water Tank Analogy for Inventory

22. Inventory Control Techniques:

23. Inventory Control Techniques: ABC Analysis:

24. EOQ (Economic Order Quantity) Model:
EOQ = square root of (2 x D x
S/H)• D - Demand
• S - Order/Purchase Cost
• H - Storage cost per unit

25. EOQ (Economic Order Quantity) Conti.......

26. Inventory Turnover Ratio:

27. Types of Inventory Cost:

28. Challenges of Material management
implementation:
• Inaccurate or partial BOM listing
• Engineering requisition issues
• Purchase order inaccuracies
• Inaccurate inventory levels
• Inventory adjustments
• Data integrity issues. (Having multiple data
sources)