Computerised Stock Control for Manufacturers
| Published date | 01 September 1985 |
| DOI | https://doi.org/10.1108/eb057415 |
| Date | 01 September 1985 |
| Pages | 16-17 |
| Author | Tony Stock |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
Computerised
Stock Control for
Manufacturers
by Tony Stock
Director, Business Systems,
D.M. England and Partners,
Woodley, Berkshire
Any successful manufacturer will be well aware of the need
for tight stock control. With the current high interest rates,
capital is much too expensive a commodity to be needlessly
tied up in the store room, and the production manager will
constantly be on the look-out for ways of improving this
aspect of the business. Furthermore, in a manufacturing en-
vironment, with the cost of materials usually being the single
largest expense, it is clearly crucially important that a great
deal of thought is put into the choice of stock control
system.
For the majority of manufacturers, computerisation can
substantially enhance their competitive edge, and stock
con-
trol is certainly one area that easily lends itself to the rapid
processing power of a computer system. However, many
of the stock control packages, available on mini or
microcomputers, are aimed at either retailers or warehouse
managers, who have a high stock turnover. In addition to
processing orders and back orders, these systems may well
have a link into invoicing and sales ledger, as well as low-
stock reporting facilities. For most companies involved in
manufacturing, this type of package is insufficient for their
requirements, as manufactured products are often complex
and usually include a considerable number of sub-
assemblies.
It must also be borne in mind that stock control is only part
of the total process of manufacturing finished goods, which
begins with the design and includes the means of produc-
tion,
such as buildings, equipment, raw materials and peo-
ple,
and includes such physical restraints as available capaci-
ty. A first step in quantifying these factors is the bill of
materials which will relate raw materials, piece parts and
semi-finished parts to the final assembly. Using a computer
helps because it is easy to maintain the bill of materials and
subsequently to generate demands for materials and capaci-
ty, and to recost finished products. Furthermore, the bill of
materials will reveal all of the assemblies where a particular
part is used. This is especially useful, for example, where
an alternative part is being considered, perhaps on grounds
of cost or performance, so that all the places where that
part is used can be quickly seen.
A computerised stock control system can help the manufac-
turer by manipulating assembly data (i.e. bill of materials)
and by providing requirements planning facilities, compo-
nent costing, kit marshalling and labour input costing. Soft-
ware providing these facilities is not widely available and
many organisations, particularly the larger ones, have writ-
ten their own inventory packages. Having software specially
written
will,
of course, allow for all the nuances of a manual
system to be accommodated, but such tailoring takes time
and money, and may not be viable for the small to medium-
sized company, or a division within a group. The alternative
is to use an established package that is available "off the
shelf". An example of such a package is "OSCAR" (On-line
Stock Control And Recording) from D.M. England and Part-
ners of Woodley, Berkshire, which has been specifically writ-
ten for the small to medium-sized manufacturer, and design-
ed to run on mini and microcomputer systems, such as
Digital's PDP-11 range. This article draws on OSCAR as an
example of a manufacturer's stock control package.
What particular features should you look for in a manufac-
turer's stock control package? First, it should be capable of
gathering all the data that you are likely to need. Most of
the simple stock control systems only have stock number,
description, current quantity and so on, but a manufacturer
needs to know a great deal more than this. Beyond the basic
information regarding stock items, suppliers and so on,
typical data which are necessary include re-order levels, unit
cost, safety stock, economic order quantity, movement
history, maximum stock, lead times, supplier codes, costing
policy and other status indicators.
Ease of use is also a prime consideration, and this will be
exhibited by such features as the use of menus which clearly
list what options are available and which guide you through
the system. Another indicator of an easy-to-use package
is the use of the principle of interactive computing, whereby
simple question-and-answer techniques are employed to
guide the operator through a series of logical steps.
As well as these more obvious points, there are a number
of other features to watch out for, such as the validation
of numeric data (through the use of check digits and so on)
and clear operator messages, which should also be
audi-
ble wherever an error is detected. In addition, the package
should be designed to provide the opportunity to "back out"
on transactions at any stage you wish. There should also
be a facility to allow for default values for commonly used
data.
16 IMDS • SEPTEMBER/OCTOBER • 1985
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