Materials Management by Computer
| Pages | 9-11 |
| DOI | https://doi.org/10.1108/eb057452 |
| Published date | 01 September 1986 |
| Date | 01 September 1986 |
| Author | T.C.E. Cheng |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
Materials
Management
by Computer
by T.C.E. Cheng
MBA Division, Faculty of Business
Administration, Chinese University of
Hong Kong
Introduction
The growth of industry has resulted in the development of
various automated systems over the years to carry out
dif-
ferent functions. The main aim of automation is to optimise
the utilisation of resources, such as materials, manpower
and capital, to eliminate human errors in the day-to-day
operations and to speed up the business processes.
There has been an increase in the use of the computer for
various applications in industry. The major reason is that
the computer is capable of receiving, storing and process-
ing data at extremely high speed and with accuracy. The
ease with which the computer manipulates reliably huge
volumes of data to produce usable information has
con-
tributed to its being widely adopted for information process-
ing in industry and business.
This article examines the roles of the computer in materials
management. It looks into the kinds of function in materials
management that can be computerised and the benefits that
can be derived from such computerisation. Besides applica-
tions based on mainframes or minicomputers, this article
also discusses microcomputer applications and the increas-
ingly important role the microcomputer is playing in help-
ing the professionals in materials management to improve
their performance and to achieve higher productivity.
Materials Management and its Challenge
Materials management is an important and specialised func-
tion existing in all industries and utilities. Although the store
management and purchasing functions have co-existed in
every organisation for a long period, the need for integrating
and streamlining these functions, along with their proper
planning on a scientific management basis, is considered
increasingly important and urgent. This is especially so with
the emergence of increasing complexity in the industry.
Every year, substantial amounts of budget funds are
allocated to materials management in industry. Since capital
is a scarce resource, whatever capital is available must be
invested optimally to derive the most benefit. Evidently, if
more capital is invested in material inventories, less of it is
available for productivity improvement tools, such as new
plant and machinery. It is therefore necessary that procure-
ment, storage and use of materials, be they raw materials,
consumables or spare parts, are managed in such a way
that the inventory level is always optimal while the capital
invested is minimal. How this difficult business is carried
out most scientifically, effectively and economically is the
challenge facing all professionals in materials management.
One of the major challenges confronting materials manage-
ment today is that of keeping up to date with rapidly
developing production planning, organising and control
techniques. This problem is accentuated by the increasing
pace of technological innovation, the introduction of new
materials, the increasing rate of mechanisation and trends
towards automation, the refinement of automatic self-
correcting controls, and the extensive use of electronic data
processing systems, such as the computer.
Roles of the Computer in Materials Management
The computer is a very efficient device for the storage and
handling of large amounts of data. It can do calculations,
analyse figures and present facts for decision making. It is
therefore a powerful tool for materials management where
large quantities of purchasing and storage items are dealt
with.
The speed of the computer is so fast that it can help
to take timely actions, resulting in savings in man-hours and
routine work of the personnel. Because of its high speed
and large storage capability, computer power can be shared
among departments, such as materials, finance, production,
engineering and so on, within the same plant or among
several plants of the same organisation. This sharing of com-
puter resources, together with the sharing of information
in a common database, helps the organisation to achieve
a co-ordinated effort for overall improvement of all functions.
Some of the benefits of a computerised materials manage-
ment function can be summarised as follows:
● more accurate information updated as and when re-
quired;
● reduced work-in-process and buffer stocks;
● better communication with other departments in the
organisation;
● reduced paperwork and repetitive work;
IMDS • SEPTEMBER/OCTOBER • 1986 9
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