Warehousing and Inventory Management - Term Paper Example

Warehouse management Introduction Warehouses are commercial buildings in which goods are stored. They are used in different business such as manufacturing companies, importers of different goods, the custom department, exporters of different goods which may either be raw materials both semi finished and the finished and in transport industry. They are large buildings which are found mostly in industrial areas which are large cities and towns. Body Warehousing planning and spacing In spacing the warehouse, the space for future expansion is of a great value because most warehouse participate in business and so there is a high chance of the future expansion .The health of the employee and their safety should be provided by offering enough space .The spacing is important in providing space for safety purposes and devices such as fire fighting equipment. This is of importance in case of an accident, where rescue activities can be conducted easily. The big space is also important in that it provides enough space for the workers to do their work without congestion and hence have a comfortable working condition. Edward A Silver, David F.Pyke (1999) Warehousing spacing and planning are of utmost important as long as the storage of goods is concerned. When there is proper planning and spacing is utilized well then there is maximum and economical utilization of the resources. For the warehousing process to be effective, it should involve an effective and an efficient warehousing process. Here it involves project management that involves use of different personnel to perform different tasks with an aim of attaining a common goal in good warehousing planning. It should bring out the use of a schedule showing the different task to be performed by those responsible, the dates on which the task is to be performed and the cost involved. Edward A Silver, David F.Pyke (1999) There should be a clear layout in which the objectives of the warehouse are clearly laid out. The objective should be the one that is going to minimize the cost of warehousing by reducing the expenses that bring unnecessary cost. The cost reducing methods should not affect the maintenance of the customer maintaining services. It should also involve the economic utilization of the available space although it should not negatively affect the operation efficiency. Also the space should be effectively be utilized in relation to the cost of the labor force, the available space and the cost of the equipment utilized. Edward A Silver, David F.Pyke (1999) The planning and spacing process should define the profile of the products to be stored. It should show the products to be stored and their nature such as storing perishable products in a cool place and storing inflammable products away from an area where there is the presence of fire. Storage space should be considered in that a small warehouse cannot be used in storage a large size then its size. Hartman Sadler (2000) The experts involved in warehousing spacing and planning should look deeply in the layout to be laid down when setting up the warehouse .Physical location should be given a significant attention .For example an ideal warehouse dealing with the goods for import is advisable to be near the custom duty offices while the warehouse dealing with the transport commodity such as vehicle should be near roads. Also to be considered is the climatic zone where some product cannot be stored in other climatic zones that may provide adverse condition such as hot climate is not conducive for storage of the fruits. The items that are received together should be stored together for easy handling. Heavy and bulky items should be stored close to the point of use in order to minimize the cost of handling them since they are heavy to transport as they involve use of a lot of manpower and equipment. Also to be involved is good house keeping method where the accessibility of the product should be maximum. Hartman Sadler (2000) After the necessary evaluations have been done, a specific layout should be chosen and implemented. The activities should be structured about schedules, tasks and the cost necessary for warehouse layout. Hartman Sadler (2000) Warehouse operation management and appropriateness of mechanization and full automation The inventory, space, equipment and the people need to be managed well in order for the organization to achieve its goals. It also involves the accurate following up of the laid up plan if maximum results is to be achieved. Josh and Curtis M (1998) There is an increase of businesses which need warehousing .This is due to increased technology and globalization. As a result there is the need of coming up with a well designed operations management plan. This plan is significant in that it coordinates the different operations in the warehouse and ensure that the business function run on a continuing process. The plan should provide an overview of the logistics of the organization such as the duties to be performed by the different department like chain and supply department, it should clearly define the duty of different management staff to avoid conflict of duties and show the requirement of the different department in term of capital and the expenses to be incurred. Josh and Curtis M (1998) In every organization, the management of people is of great value. This is because it is the people who control, execute and apply influence on all the operations in the warehouse. The proper utilizing of the human resources ensure that time is saved and hence result in cutting of cost. It also ensures that there is division of labor to ensure efficiency of staff in performing their duties. It is the duty of the operation management to ensure that work is completed on time to ensure that there is no unnecessary delay which may cause inconvenience to customers. Josh and Curtis M (1998) As time goes by, there has been an increase of work to be done in the warehouses and this has contributed to high cost of handling documents manually and also coordinating of different tasks has been cumbersome. The operation management has come with efficient operation systems. The operation management systems are advanced in technology and operating process that ensure that there is a maximum coordination of all the operations in the warehouse. It has enabled the operation manager to ensure an economic use of inventory, efficient control of the staff, ensure an economic utilization of the warehousing spacing, and ensure the timely efficient serving of customer in both receipt and the supply of the products. Josh and Curtis M (1998) To ensure efficient use of resources, these information systems have been put to a wide use. An example of the warehouse management system is the 'high jump' warehouse management systems. Josh and Curtis M (1998) Supply management is one of the key factors in operation management. It ensures that there is integration of technological capacity of the warehouse and the activity of the human resource to effectively utilize the inventory and offer support in ensuring the warehouse achieves its goal. It also ensures that there is efficiency in procurement process. Mehdi khosrowpour (2004) The operation research to come up with new products of improving the service to the customers is one of the cornerstone of the operation management Due to increase in competition in warehousing ,the operation manager have come up with improved services to satisfy the customer demands. For example is the improved hauling system for products and efficient transport system in the warehouse which is more important in time saving. Mehdi khosrowpour (2004) Operation in the warehouse need ways in whish the efficiency can be improved and time can be used effectively. Automation and mechanization are currently widely used. Mechanization is whereby the machines are used by the human operators to provide them with physical requirement of work. Some work may be too hard or dangerous for the human being to perform and so they employ the use of machines. Example of the use of machines is in transporting of heavy of products by the use of fork lift. Generally the machines in mechanization process are used to make the work easier. Mehdi khosrowpour (2004) Automation is whereby there is replacement of the human physical and mental effort by the machines although the machines are controlled by the well qualified human beings. Control systems such as the computers and remote control are used in performing different duties. The use of automated machines have led to the increase in productivity, increase of flexibility in the job since there is good use of warehouse space due to increase of the coordination of the activities in the warehouse. This has also led to the use of time since these devices are time saving especially in office works where computers are used. In automation there is a reduced chance of errors occurring due to human weakness such as fatigue and negligence. Example of automation is the use of robots in transport of hazardous substances such as industrial chemicals. Mehdi khosrowpour (2004) The impact of information technology in warehousing The objective of the ware house manager is to ensure that the business to expand, unveil new products and offer a satisfactory services to the customers. Due to this, there has been an increase in the use of information technology. An example of the company in which information technology has been used is Rolls-Royce which is the leading provider of power systems and services for use in land, sea and in the air. The increase of its output requires an effective warehouse information system. Josh and Curtis M (1998) Roll-Royce is a large company since it operates in a large number of items such spare parts, aero engines and to store these there is the need for a warehouse. To manage the tracking and the direction of these parts should be coordinated by data base driven computer. This operates as the warehouse management system. This enables the management to know the way these machines are moving, ensure that they are secure from dishonest employees and is important in providing data in calculating the final accounts such as the balance sheet. Josh and Curtis M (1998) Information Technology has an important role in the human resources management of the company. Information technology is important in the identification of warehouse job vacancy and hence lead to the advertising of jobs through the internet. This is important in that fully qualified individual from different parts of the world can apply for the jobs through the internet, conduct interviews through the internet and this reduces the recruiting cost incurred by the company. Information technology also improve communication to the employees such as in the use of voice driven communication within the warehouses and their distribution centres.This leads to increase of the workers motivation by having a free hand in their work than having to read orders. These factors will lead to an increase in the efficiency in human resources management by the Rolls-Royce. Josh and Curtis M (1998) Information technology will lead to automation of the warehouse operation of the company. Computers running logistics automation should be put into use. This will ensure that there is automated storage and the retrieval of these aerospace parts. This will assist in saving of time and reducing of errors which are caused by the humans such as negligence. The use of robots should be employed to assist in the carrying of the heavy materials such as the engines of the planes. This will assist in reducing the cost of using human physical effort hence reduce the labor cost. Josh and Curtis M (1998) The warehouse manager of Rolls-Royce will find information technology in financial planning and management. The use of efficient computerized financial information systems will reduce the bulkiness and the cumbersome job of dealing with a lot of paperwork such as physical summing of credit notes. It also allows the quick preparation of interim and the final accounts such as the profit and loss accounts. Josh and Curtis M (1998) The warehouse space should be well used. This is to ensure that there is movement at ease during work by both human and machines. Information technology can be of use by installing surveillance cameras with a control centre to view how the warehouse space is used, detection of unused space which need to be used and it can be used for security purposes. Josh and Curtis M (1998) Information of technology can be of a significant importance especially in e-commerce business where the outsourcing of services is concerned. This is important in reducing the transaction time and reducing the distance between the business and the customers. This is also important to the company especially by the use of internet by the customer to order for the services as he can be served at a central warehouse than having many warehouses at different places which is costly. Mehdi khosrowpour (2004) In the after market services, the company plays a big role in improving the customers loyalty through outsourcing and this is beneficial to the company as it reverses the logistic success as the lost profit can be regained when they resell the repaired products. Josh and Curtis M (1998) Inventory management in warehousing Inventory refers to the goods and the material that are held in business as stock. Inventory management involves the control of the process involving the acquiring the goods, storage of the goods and the supply of the goods to the customers. James Hansberger Greene (1970) The modern management of inventory ensures that the services to the customers are highly satisfying .Customers keep the business afloat and so they are a cornerstone to the expansion of the ware house. In this case, a continuous flow of inventory available to the customers ensures that they are not inconvenienced and the warehouse business is kept in operation. Customer's priority should be considered by the stocking of wares which are fast moving as this is the centre of customers' interest. The roll Royce Company should ensure that the fast moving stock should be in place and in large quantity. James Hansberger Greene (1970) In warehouse management purchasing and production of the products is important factor to be considered in warehouse management Here the inventory should be held due to the efficiency of the cost and should make the procurement easier.Here goods should be purchased in large quantity than they are needed to reduce the cost due to advantage of bulk purchase and reduce the cost of transport. This is important for the company rolls-Roy in that it will enable the buying of spare parts to be easy and cost efficient. James Hansberger Greene (1970) In the management of inventory, the stock should be kept at a low amount as possible. This is so especially the slow moving stock which may result in a lot of cash being tied up in the stock and hence result in negative cash flow. Also the financial management of the activity involving the purchasing, storing and distribution of the inventory should be considered to avoid the wastage of money in these transactions .This is so important especially n the companies that involve large amount of money in the operation of warehousing like in rolls-Royce William H Bluenel, Joseph D Phanton (1978) In management of inventory in the warehouse, information system plays an important role in ensuring that the movement of the stock is efficient and transparent. An inventory management system is used automatically to monitor the quantity of the inventory, looks into the history of stock and makes a decision on the inventory to be replaced. The system also shows the storage of the inventory, the level of inventory as per that time and receives information from different suppliers and coordinate the information with the current level of the inventory and hence come with a decision on the amount to order. William H Bluenel, Joseph D Phanton (1978) The traditional method of warehouse management such as re-order point and EOQ are different in both level of technology and their way of operation. In the re-order point the Stock is re ordered when it just reaches the point of depletion but in the modern system the stock level is analyzed and the time at which the stock is likely to be depleted is known through an automated system and as a result the order is made before the stock get depleted. William H Bluenel, Joseph D Phanton (1978) In modern inventory system there is pooling of the work station especially in the production department since there are few stations to go through but in the tradition system such as the Re-order system, it involves going through many different stations and so it wastes time for the customers hence causing inconvenience to the customers. In the modern inventory system, the forecast for ordering the new stock is in cycle form while that of the tradition method such as EOQ is the safety inventory method. Edward A Silver, David F.Pyke (1999) Conclusion Warehouse plays an important role in the storage of products of different companies. Due to this; they bring about the big use of information technology and thus assist in time saving. This result to globalization of their services and hence they take part in the improvement of the global economy. References Edward A Silver, David F.Pyke (1999): Inventory management and production planning and scheduling: John Wesley and sons Hartman Sadler (2000): Supply chain management and advanced planning: John Wesley and sons John A.Tompkins, Jerry .D .Smith (1994): Warehouse management: Tompkins press George j .Ritz (1998): Total construction project management: McGraw-Hill Profession Josh and Curtis M (1998): Information technology and organization: Idealgroup Inc Mehdi khosrowpour (2004): Innovations through information technology: Ideal group incorporation William H Bluenel, Joseph D Phanton (1978): Service management, principles and practices: Macmillan press James Hansberger Greene (1970): Production and inventory control hand book: Macmillan Read More