Inventory Management In Civil Service

Project and Seminar material for Public Administration

Abstract

This research sought to examine inventory management practices of Enugu state Ministry of works. The study is applied descriptive survey design and mixed research approach. The target population was employees of Enugu state Ministry of works. And the total number of respondents undergoes in this study was 127. Primary data were gathered using semi structured questionnaires and interview. A statistical package for the social sciences version 23 is applied for the purpose of processing and analyzing the results. The study result revealed that the information technology and internal control system of Enugu state Ministry of works is highly effective in managing the inventory level and meeting the state demands. However; further improve is required in areas like inventory physical counting inspection, handling of overstocking and under stocking of inventories, data accuracy and real time report preparation. Moreover, the Ministry mainly used ABC inventory techniques to determine the materials demand of the state. More importantly, lack of management support, insufficient qualified staffs and shortage of training are the major problems for assessment of inventory management practices. Based on the findings, it can be concluded that the inventory management practice sat Enugu state Ministry of works has a contribution in improving the ministry’s overall accomplishments in terms of service delivery, reducing damages and wastages, state service, suppler relationship, inventory planning and scheduling and management of information reports. Finally, the study recommends that the managements of the ministry should work hard to keep on the its superior inventory management activities and try to overcome the shortcomings which were identified by this survey.

Chapter One

Introduction

1.1 Background of the Study

Inventory control or management can be dated far back to 18th century, during industrial revolution and was called materials management control. It was bone out of European desire to develop industrially and for them to succeed it was pertinent to educate the people on the importance of effective management of resource and materials include, equipment, moveable and non-moveable. People did not realize that materials represent an equivalent amount of cash. For this reason efforts were channeled towards cash control only.

Since the beginning of second world war the movement of materials and material handling determinant of modern production. It was found during third period that in as much as it was important to control cash, the control of inventory exceeded that of cash, so in every economic activity such as trading maintenance and manufacturing etc. inventories are in form of finished goods, there is greater need to take appropriate care of inventories to ensure the attainment of estimated goals and objective.

To maintain effective and efficient inventory management the management is duty bound to control the stocks in a way to avoid stock outs, pilferage et.

Inventory record shows at a glance a more accurate picture of the position of stock on hand.

Money must not be tied up in unwanted inventories, man and machines are not at hand. The major goals of inventory control is to discover and maintain optimum level of inventory investment. Careful implementation of the methods of controlling the inventories facilitates the attainment of the organizational goals and objective.

Ensuring a balance of stock to avoid both shortages and excessive of material requires control and planning. Control plans must provided inventory acquisition with current estimate value. A decrease in estimate value will result to less acquisition of inventories, unless adjustments are made.

1.2 Statement of Problems

Inventory management in government stores or ministry administration is without doubt, with it problems and prospects. The government system, unlike business organization or enterprise is not a purely profit making organizations.

The valuation and the method to use in valuation of unused inventories at the end of accounting year, ahs become problems because of different methods.

It is prevent that some government and non government organization do not take appropriate control of their stock and this leads them to the “stock and Syndrome” which results in loss of profit and possible liquidation of the business.

In government ministry, lack of stock and finance makes the whole system a mockery this gives room to the dividing fall in the value and standard in a developing country like Nigeria.

1.3 Objectives / Purpose of the Study

The followings are the main objective of this research work, is to find a lasting solution on how inventory management in government an non government organization can be maintained through the following heading.

Efficiency in maintenance of inventory and management.
To find how to guide against over and under stocking of materials.
To guide against and accumulation of obsolete materials.
To pretest against waste of inventories and paltering.
To find how to record income stock and balance same
To indicate quantity and value of stock at glance
To find out how training could enhance effective and efficient inventory management.
To make suggestions and recommendations that could enhance effective and efficient inventory management.
To make suggestions and recommendations that could useful in solving the identified problems.

1.4 Research Questions

What are the three stock valuation systems adopted by the ministry of works and transport?
How does the store department operate in terms of stock taking of inventories?
What are the procedures in issuing out items of stock in the ministry of works and transports?
What is the stock control system used in the department, namely manual or mechanical (computer system)?
What is the name of store analyses used in ordering of stocks?
Is there any penalty against any staff found with an unauthorized materials (s) of the ministry?
What is the point of re-order level of stock or materials may be placed?
What type of raw materials do Enugu state ministry of works and transport used in construction works?

1.5 Scope of the Study

The scope of the study is researching into inventory management in Enugu state, Ministry of works and transport.

1.6 Significance of the Study

This research work is considered important because of the important role inventory management is expected to play in the life cycle of business inNigeriain government ministry and non-government organizations.

Efficiency and economy in management are rendered easier of attainment.

This research work is of good help to student on business career and those with interest in stock keeping and control.

It is extremely useful to manager of stock, who would wish to achieve optimum performance in business, the managers need to understand the general concepts and problem in stock or inventory managements.

Detection, location even prevention of waste and pilferage are facilitated.

The study will go a long way in improving the methods of receiving, issuing of stock and waste of valuable stock or materials.

This research work will help researchers on inventory management and control to further their work in the field. Student will therefore, benefit form this in researching into similar topics.

1.7 Definition of Terms

1. Requisition Note

This is written by replenishment department to meet the article needed by each section.

2. Inventory card

A list of articles comprised in an estate, describing each article separately and precisely so as to show what the estate consist at glance.

3. Store received Note

This entails the movement of goods to the requested section.

4. Store issues Note

This entails the movement of goods to the requested section.

5. Store Transfer voucher

This arise when three is misquotation of stock or surpluses tore transfer note can be raised to correct the same.

6. Bin Card/Tally card

Is a card attached to all items of stock for easy identification and instant picture of the balance of the article.

7. Inventory

This refers to all stock of item used within the production system or in the operation of the business of any organization.

8. Management

This is a process of combing and utilizing or allocating on organization input (men money and materials) by planning, organizing, directing and controlling for the purpose of producing output desired by consumers so that the organization objectives are accomplished.

8. Management

This is a process of combing and utilizing or allocating on organization, directing and controlling for the purpose of producing output desired by consumers so that the organizational objectives organizational objectives are accomplished.

9. Inventory management

This entails regulation of inventory, combination of stock items, allocation and utilization of these stock items to achieve effectiveness and efficiency, so as to accomplish desired results or organizational objectives.

10. Stores

This refers to the stocks of items in the government store.

11. Consumable stores

These represent those items of materials that are used up immediately they are issued or purchase e.g fuel food stuff, spare parts etc.

12. Contro

This refers to process of restraining for checking the results of an experiment.

13. Stock

Means a store of goods available for sale, distribution or use.

14. Obsolescent

Becoming out of data or expired, out of use.

Chapter Five

Summary, Conclusions and Recommendations

5.1 Summary of the Findings

It proved that ABC inventory technique is focal methods to determine the materials demand of the state at Enugu state Ministry of works.

Above average the result indicated that lack of management support, unqualified staffs and shortage of trainings are the major cause which affects effective inventory management system at Enugu state Ministry of works.

The highest number of respondents assured that Enugu state Ministry of works use information technology to manage its inventory stocks.

The survey result revealed that information technology adopted by Enugu state Ministry of works has greater data accuracy. Even if a significant number of respondents (21.3%) were disagreed.

The majority of the respondents replied information technology of Enugu state Ministry of works is enabled to maintain good supplier relationship, improve interdepartmental coordination and increases state service.

Most of the respondents disclosed that information technology system of the Ministry save time to prepare inventory reports while sizable respondents (18.9%) were disagreed.

The utmost of respondents were agreed that Enugu state Ministry of works held inventories to mitigate current and future demand uncertainty.

The highest number of the respondents agreed that Enugu state Ministry of works applied strategically supplier partnership in each inventory process.

The majority of the respondents replied that Enugu state Ministry of works properly managed its overstocking and under stocking of inventories. Whereas noticeable respondents (15%) were disagreed.

The greatest number of employees agreed that in Enugu state Ministry of works the inventory management system plays a role in reducing damages and wastages as well as minimized unwanted operational and inventory costs.

Significant numbers of respondents were opined that inventory management system of Enugu state Ministry of works improves both management of information reports and inventory planning and scheduling.

5.2 Conclusion

This study tried to examine the inventory management system at Enugu state Ministry of works. In particular, the first objective was to assess the information technology system adopted at Enugu state Ministry of works. Therefore, the study result revealed the Enugu state Ministry of works has used information technology. It is highly effective in data accuracy, real time inventory reports, service provision, state service and interdepartmental coordination.

However, further upgrading is required to improve the data accuracy and real time report of inventory management system of the ministry.

The second objective was to examine the internal controls in the inventory management practices of Enugu state Ministry of works. The finding disclosed that the Ministry is largely effective in inventory internal controls related to mitigating unexpected demand uncertainty, taking strategic inventory supplier partnership, managing overstocking and under stocking of inventories, protecting inventories from damages and obsolete, retrieving inventory items easily, inspecting physical count and recording up to date inventory items. Nevertheless, a noteworthy number of respondents were claimed that the internal inventory control of the Ministry is weak to record inventory items properly up to date, inspect the physical inventory items timely and handle overstocking and under stocking of inventories.

The third objective was show the contribution of inventory management system of Enugu state Ministry of works towards its performance. Based on the findings, it can concluded that theinventory management system at Enugu state Ministry of works has a contribution in improving the ministry’s overall operational activities in terms of service delivery, state service, suppler relationship, management of information reports and inventory planning and scheduling. Besides, it has a role in reducing damages and wastages as well as minimizing unwanted operational and inventory costs.

Furthermore, the rest of the objectives were on the methods and problems of inventory management system of Enugu state Ministry of works. Through the findings the study revealed that ABC inventory techniques the main methods to determine the materials demand of the state. More importantly, from the interview feedbacks and respondents; lack of management support, insufficient qualified staffs and shortage of training are considered asthe main problems for effective inventory management system of Enugu state Ministry of works.

To conclude, inventory management system at Enugu state Ministry of works is effective and has a great contribution on the ministry’s overal accomplishments

5.3 Recommendations

The finding indicated that though information technology system of Enugu state Ministry of works is highly effective still some of the employees of the ministry did not support specifically in data recording accuracy and preparing real time of the IT system. Therefore, the managements of the ministry should give better attention just by arranging meeting with the employees to review the problems, find out why the IT system inefficient to record inventory items accurately, generate real time reports appropriately and take a remedial action.

Most of employees confirmed that the existence of sudden inventory physical inspection and proper inventory items record but still there is inconvenience in works of the internal inspection and repetition of inventory items record. Therefore, the management of Enugu state Ministry of works has to follow up the operations of the inventory management process by strengthening the internal auditor teams and create accountability for those staffs who are negligent to record inventory items properly.

Based on the analyses, Enugu state Ministry of works should try to align its internal inventory management operations, especially in managing overstocking and under stocking that can lead to achieve competitive advantage. In this regard, the managements of the Ministry has to ensure that inventory items are at the right place, at the right time and in the right quantity just by consolidating strategic orientation and creating accurate inventory data to forecast demand.

The finding also indicated that lack of management support is the major cause for ineffective inventory management system at Enugu state Ministry of works. Hence, the management has to fully participate in inventory management process in creating safe workplace and follow upping the appropriateness and implementation inventory procedures.

Enugu state Ministry of works need to invest towards creating learning capabilities in general and inventory management learning capability in particular for supplies personnel and other staffs via availing various trainings so that such capabilities can contribute for the effective of inventory management.

Policy objectives of the GTP II entail maintaining encouraging main sectors of the economy, manufacturing sector. Looking this, the need to assess periodically the inventory management system is not only the issues of Enugu state Ministry of works but also the main concern in GTP II agenda. Therefore, policy analysts must look at a wider range of issues than those highlighted here. Nevertheless, the importance of this benchmark analyses should not be minimized. It provides useful way to focus on policy work by indicating some area of inventory management practices improvements.

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