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THE EFFECT
OF MATERIAL MANAGEMENT TECHNIQUE ON PRODUCTION PLANNING PROCESSES
ABSTRACT
The aims and
objectives of this work is to examine “The Effect of Materials Management
Techniques on Production Planning Process with reference to United Nigeria
Textile Plc (UNT Plc), Kaduna... Materials management is open to so many
problems in industrial sector in Nigeria, especially when theory and practice
are compared. Among the problems facing materials management in Nigeria, which
is also peculiar to the company which the project is based on are: Multiplication
of materials management principles, unprofessional/unskilled personnel, given
the task of material manager. The writer looked at the opinions of different
notable authors and academic writers on the topic that are related to the
subject matter. It was deduced that those academic writers are of the same view
as far as materials management is concerned. In this research study, I will
attempt to look at the following points:
· The purpose of the study, historical
background, statement of the problem, limitation and scope of the study,
rational for the study.
· Literature review on materials
management, production planning, materials control, purchasing, stock ordering
and types of stock taking, benefit of stock taking.
· Methodology, research methods and
approach used, justification for approach used.
· Presentation and analysis of data, and
also test of hypothesis.
· Summary of finding, conclusion and
recommendations.
CHAPTER ONE
INTRODUCTION
Material
management is an integrated management approach to the planning, purchasing,
ware housing, stock keeping allocation and movement of needed material from
point of source to user department. It can also be defined as the process of
management of material which involves purchasing, storage control and
transportation.
Material
management is a relatively new discipline. The 20th century's rapid growth and
the significant industrial development has played a major role in the
relationship and effective management of the traditional 5Ms which are:
Machine, material, men, money and management.
The famous
industrial revolution made material(s) the largest elements cost in any
organization.
At the wake
of the 20th century many firms had recognized the importance of material, and
several material activities like purchasing, ware housing, stock control and
distribution carried out by the organization.
By the 1950
firms have identified the need for effective coordination or integration of
such material activities and material organization tools concept like those of
physical distribution movement, logistic movement and material management as a
means to check, co-ordinate and control the firm's material activities.
Globally,
there is no clear definition on the area of material management. According to
M.A. Tokunbo (1987) defines it in the context of store and material control as
compensation for the effective co-ordination of the principle element.
ü Identifying, classifying and coordination
of stocks
ü Provision, inventory control and stress
accounting
ü Store house layout and organization
ü In house storage handling and distribution
ü Presentation of materials in store.
To these,
material management has the duty to apply the most suitable technique in the
most effective way to ensure the minimum total cost consistent with providing
the service required.
The American
production and inventory control; society (APICS) defines material management
technique and production as the grouping of management function related to the
complete cycle of material flow from the purchase and internal control of work
in the latter term, traditionally is limited to internal control of production
materials.
In examining
the whole definition one could easily notice that they are not quite different
from one another only the way of approach and little difference in terminology.
In this respect (material and resource) or material management is not only
limited to buying and storing as many view it but involves also purchasing,
transport and distribution planning and continuous monitoring.
1.1 BACKGROUND OF THE STUDY
The subject
matter of this study is the effect of material management technique on
production planning process in United Nigeria Textile Plc (UNT Plc), Kaduna.
The research is meant to be of great importance to various enterprise and
organization wishing to conduct a detailed study into stores and purchasing
material hence, the research aims at identifying the problems associated with
efficient operation in an organization, the research is interested in knowing
the effect of material management technique on production planning process as
practicable in an organization. Due to sophistication in technology coupled
with socio-economic and political instability, production processes face
complex problems that needs to be addressed by management ensuring that materials are allocated and
used in the most efficient and effective manner.
The material management technique on
production is also to identify problems by guiding against supb-optimization of
the material management techniques in production planning processes, for this
the researcher suggests that which will achieve optimal result quickly, cheaper
and acceptable.
Today
materials are the live-wire of every organization be it public or private hence
no organization can survive without material, its availability, distribution
and transportation and delivery at the right amount and quality is paramount.
1.2 STATEMENT OF THE PROBLEMS
United
Nigeria Textile Plc (UNT Plc), Kaduna. is faced with problems in relation to
utilization of the effect of material management being the utmost thing that
are needed to be utilized effectively. The problem facing material management
especially United Nigeria Textile Plc (UNT Plc), Kaduna. are mainly under
stocking or over stoking of material, stock obsolescence breakage and the
economic order quantity.`
Due to the
fact that the impact is to be felt positively in the society by making
themselves’ productive in every area of inputs.
But despite
the effect observed there have been general apathy, ignorance and lack of
interest by many people and the government.
1.3 OBJECTIVES OF THE STUDY
Specifically,
the aims and objectives of this study are:
i. To assess the impact of material
management on organizational performance.
ii. To appraise and further appreciate
the significance of material management in a manufacturing industry.
iii. To identify and ascertain some of
the problems poised by materials management in Nigerian United Nigeria Textile
Plc (UNT Plc), Kaduna.
iv. It is also the researcher's desire
that this compilation will be of great help and interest to whosoever uses it
to gain knowledge on issues discussed.
1.4 STATEMENT OF HYPOTHESIS
The following hypothesis was
formulated for this study:
H0: Material management does not have any
significant impact on organizational performance.
H1: Material Management does have significant
impact on organizational performance.
1.5 SIGNIFICANCE OF THE STUDY
A research of this nature will be incomplete
without highlighting the importance of this study.
Firstly, the
researcher as a student aspiring to be a material executive in the future sees
this study as an opportunity to fully investigate into the field of materials
management to see the challenges therein.
Secondly,
the study is needed as a pre-requisite for the award of the Higher National
Diploma in Production and Operation Management (POM).
Furthermore,
the researcher has also undertaken the study in order to gather necessary
information and suggest solution to the problem facing materials management in
United Nigeria Textile Plc (UNT Plc), Kaduna.
1.6 SCOPE OF THE STUDY
The subject
matter “Materials Management” has an area of coverage within its concept, i.e.
theory and practice in the private sector. This would also include purchasing,
stocktaking and stock checking of materials.
1.7 LIMITATION OF THE STUDY
In carrying
out this research, certain problems were encountered which in fact hindered the
area of coverage.
· The researcher faced the
problem of sourcing for materials for the project.
· Time constraint was a factor
the researcher encountered. This resulted in the backlog of the researcher’s
class work.
· Lack of textbooks related
to the subject matter also contributed to backlog in writing the project.
· Unco-operative and bureaucratic
attitude of United Nigeria Textile Plc (UNT Plc), officials who were reluctant
in providing necessary information in writing.
· Despite all these
constraints, the researcher was lucky to gather vital information that made the
investigation a success.
1.8
HISTORICAL BACKGROUNOF UNITED NIGERIA TEXTILE PLC (UNT PLC), KADUNA.
The United
Nigeria Textiles PLC, formally called the United Nigeria Textiles Limited
(UNTL) is located in Kakuri Industrial Area of Kaduna South Local Government
area of Kaduna State.
Mr.
Cha-Chi-Ming, a Chinese founded it on May 7th, 1964, with some Nigerians and
commenced operations in early 1965. The company started operating as a
finishing plant, importing policy on backward integration in June 1976, the company
immediately acquired and installed its first spinning and weaving facilities to
produce its own Grey Baft from locally grown cotton.
For its
determination to expand its operation the company acquired controlling interest
in Zamfara Textiles Industry Limited (ZTIL) in 1976, by this, there is a steady
supply of Grey Baft for its highly efficient finishing plant in Kaduna. UNT.
PLC is the only factory capable of producing highly sophisticated wax prints in
the country and indeed the whole of West Africa.
In 1976,
fresh idea of another factor was conceived, so in 1977 its incorporated Funtua
Textiles Limited (FTL) to produce materials different from the conventional
products of Kidnap factory and Gusau factory, the Funtua Textiles United
produces high quality bedspreads, pillow cases and cotton/polyester fabrics in
various designs and colours.
In 1980, the
company bought Norspin in Kaduna from its former owners UAC. The name Norspin
was changed and its is now a subsidiary company registered as unitex Limited
and an associate company named Supertex limited. Unitex Limited is a spinning
plant producing yam for the sole consumption of UNT Plc, while Supertex limited
is a finishing plant producing wax prints for export to ECOWAS countries and
USA with the support and encouragement from business-like partners such as
Northern Nigeria Development Company (NNDC), Nigeria Industrial Development
Bank (NIDB), New Nigeria Investment Limited (NNIL), Kaduna State Government and
the Federal Ministry of Industry. In view of technological advancement UNT. Plc
have embarked on basic technological review of its machines and equipment
through computerization, restructuring and modernization of its various
components units, improved transportation system. It was scientific approaches
to solving environmental problems. It is the first mill in Nigeria to acquire
and install its own effluent treatment plant for minimizing health hazard and
preventing land water pollution.
UNT plc is
the largest employers of labour among textiles industries in the country and
the largest in terms of production capacity. It has a total workforce of
15,000. The total install capacity is for ninety six million meters (96m)
finished materials. Currently the company is expanding its factory building to
accommodate additional processing machines for its blocked real wax prints and
finishing department. The expansion of the finishing department will enable the
company to engage in bleaching, dying and finishing of synthetic cotton blend
textiles.
The aims and
objectives of the company are to undertake the production and marketing of
textiles commodity. Thus, it is involved by weaving, dying and printing of
textile materials which has helped Nigeria in providing employment as well as
having locally made textiles materials without difficulties and at cheaper
prices compared to imported ones.
OWNERSHIP
STRUCTURE OF UNT. PLC
At inception
the paid-up of capital of UNTL (now UNT.Plc) was N1.4million. The shareholders
of the company are made up of the followings:
a. Private individuals from china 49.5%
b. UNT. Plc staff 21.17%
c. Other Nigerians
15.6%
d. International finance corporation (IFC) 7.8%
e. New Nigerian Investment Limited 5.6%
ORGANIZATIONAL
STRUCTURE OF UNT.PLC
At the apex
of UNT.plc organization is the board of directors. The shareholders elect the
members and they hold the office for
terms, which are renewable at the expiration of each term. Following by
the managing Director (MD) who implements the board’s policies and decisions
taken at the board meeting on the running of the organization. The company
secretary stands between the board of directors and the managing director.
However, the managing director is accountable to the board, the board are in
turn accountable to the shareholders.
The managing
director is charged with the day-to-day running of the organization and
assisted by experienced managers who from the nucleus of the management. There
are departments most of which have sections; a senior manager referred to as
assistant general manager (AGM) mans each of the department. The department
comprises of human resources/personnel, sales finance, production and
administration departments.
The chart
below shows the organizational structure of United Nigeria textiles Plc,
Kaduna.
Company
secretary
Managing
Director
General
Manager
AGM SALES
AGM
PERSONNEL
AGM
PRODUCTION
AGM FINACE
AGM ADMIN
SALES MGR
ASSISTANT
SALE MGR
CEN. STORE
OFFICER
WAREHOUSE
STORE OFFICER
PER. MAT
STORE MGR
ASST.PERS
M ANAGER
PER/SUP
OFFICER
PROD./PIT
DYEING MGR
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