Formal System to Control the Flow of Materials and Goods from Supplier Through Stores and Production to Dispatch We Must First Summarize the Current Problem Area
Case Study – Big D Company
TASK 1
1.1 In order to advise the management on the installation of a more formal system to control the flow of materials and goods from supplier through stores and production to dispatch we must first summarize the current problem areas confronted by the Big D.
• Problem areas in Big D Company are presented in the order shown in the paragraph
o On the highly standard material sizes, more than enough for one order might be purchased and in most cases full lengths would be ordered rather than the exact fraction needed.
o Some of the ordered exceeds the immediate requirements resulting in the purchasing of the same material without verifying the available stock.
o Molded plastics were sometimes bought in excess of immediate needs and the quantities shown on the bill of materials were note amended.
o Materials brought in from the supplier were not crossed checked with the Big D records and taken directly to the production or assembly.
o Shop works were not scheduled and machines were idle and the foreman worked on any order.
o No formal purchasing system
o Completed jobs were not recorded and sometimes units were assembled in advance of the completion of the entire lot.
o The sales and production records indicated frequent early deliveries or
o Quite a few times completed orders were kept in storage room … which caused lost orders.
o The superintendent usually allowed himself more time than was necessary for ordering, machining and assembly. Again this caused loss of order.
o The company had not formal inventory control system.
o Not records were kept of raw materials.
o An Informal tabulation of finished goods was used.
o Job were frequently sold even before completion
o A second lots were started before the first was finished,
o No formal production planning and inventory control activity.
• The Proposed for
TASK 1
1.1 In order to advise the management on the installation of a more formal system to control the flow of materials and goods from supplier through stores and production to dispatch we must first summarize the current problem areas confronted by the Big D.
• Problem areas in Big D Company are presented in the order shown in the paragraph
o On the highly standard material sizes, more than enough for one order might be purchased and in most cases full lengths would be ordered rather than the exact fraction needed.
o Some of the ordered exceeds the immediate requirements resulting in the purchasing of the same material without verifying the available stock.
o Molded plastics were sometimes bought in excess of immediate needs and the quantities shown on the bill of materials were note amended.
o Materials brought in from the supplier were not crossed checked with the Big D records and taken directly to the production or assembly.
o Shop works were not scheduled and machines were idle and the foreman worked on any order.
o No formal purchasing system
o Completed jobs were not recorded and sometimes units were assembled in advance of the completion of the entire lot.
o The sales and production records indicated frequent early deliveries or
o Quite a few times completed orders were kept in storage room … which caused lost orders.
o The superintendent usually allowed himself more time than was necessary for ordering, machining and assembly. Again this caused loss of order.
o The company had not formal inventory control system.
o Not records were kept of raw materials.
o An Informal tabulation of finished goods was used.
o Job were frequently sold even before completion
o A second lots were started before the first was finished,
o No formal production planning and inventory control activity.
• The Proposed for
References: Supply Chain Management: Strategy, Planning, and Operations, Second Edition by Sunil Chopra and Peter Meindl (May 1, 2003) Purchasing and Supply Chain Management by Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero and James L. Patterson (Mar 8, 2011) 5th Edition South-Western College/West; 5 edition (March 8, 2011) ISBN-13: 978-0538476423 Purchasing and Supply Chain Management: Analysis, Strategy, Planning and Practice by A. J. van Weele (Dec 9, 2009) ----------------------- Case Study – Big D Company Purchasing (BUS441/20762P) [Prepared by Mohammed] [13th May 2012]