CHAPTER ONE
1.0 INTRODUCTION
BACKGROUND TO THE STUDY
Production
is any unique process or procedure designed to transform a set of input
elements into a specific set of out put elements. Input elements include land,
labour capital and entrepreneurial ability while output elements are goods and
services that satisfy human wants. Good and services are viable only if they
provide satisfaction to the customers and the simple interior is the only
general condition existence manufacture and distribution of goods. It can also
be defined as the science and at concerned with the slow of materials in industry
and commerce.
As a business function, production is
primarily concerned with the transformation or conversion of input resources
(raw materials) into finished goods. It can be said to be the relationship
between factors of production (i.e. land, labour and capital) and a given
output.
Planning is defined as the first and
perhaps the most important function at management. The essence of planning
events. Planning goes beyond attempting to attain dstated organization
objective. It involves the development of strategy and procedure required for
effective realization of the entire plan. The most basic function of the
management functiosn is planning and it involves selection form among
alternatives future causes of action for the enterprises as a whole. If production
is well planned. Thus adding to the attainment of the whole organizational
objectives, planning have finished the standard of control.
Inventory on the other hand is an
important factor in the achievement of an organization overall objective. Inventory
refers to any stock on items within the productin system or in the operation of
the business. In operation management, inventory refers to resources that
remain idlge in anticipation of satisfying a future demand for it. The state of
processing one is likely to see in a factory but all the human resources
maintained but not currently used by an organization in order to meet
anticipated dimand for its product or services. According to Monk (1977)
inventories are one of the major assets of most firms ranging from perhaps 25%
to 75% of their current assets. This depends on firms or types of industry
actually next of plants, buildings and equipment, inventories often from bulk
of assets value of an organization, which requires large amount of investment
and capital cost of maintenance.
Control is a process that guide
activities towards some predetermined goals. Control is the managerial ability
that helps to ensure acquisition and use of the enterprise resources and
achievement of its objectives. It involves a comparison against some previously
established standard and then taking corrective action when an unacceptable
deviation occurs.
Production planning is the function of
management concerned with deciding what production facilities are required, how
these production facilities should be laid out in the space available for
production and how they should be used to produce products. It will be seen
that the function has two main parts. First, it is concern with routing or
planning the sequence of work tasks that have to be carried out to complete
products. And second, it is concerned with layout or planning the spatical
relationship between the places were work is done.
Production planning inventory control
functions in general include the planning itself, taking strategic decision
areas relation to and setting up device(s) to check and direct any deviation
that may want to occur during the process, large amount of investment and
capital cost maintenance of the productive system, quality control, product
objective and setting in motion of applicable corrective works as expected. All
these will have to be put in place through careful production planning and
inventory control.
1.1 STATEMENT
OF THE PROBLEM
It
has been observed that majority of the manufacturing companies in do not
carryout production planning and control more complex and this has made it
difficult to achieve the expected result. These failures, which may be due to
unavailability of fraud labour, shortage of raw materials, lack of managerial
ability etc. will be research into.
Problems such as stock high capital tied
on inventory damages and breakages, pilterage, stock out and buffer stock can
be easily avoided when one effective and efficient inventory control system is
in place.
No matter how prosperous a company may
be inventory control and planning requires a professional expertise.
1.2 OBJECTIVE
OF THE STUDY
This
study is being carried out to achieve the following objectives.
i.
To examine the problems
that production department
ii.
To analyze how
effectively and efficiently the company utilizes the resources at its disposal.
iii.
To analyze how
inventory should be controlled in order to guide against stock out so as to
meet production level.
Therefore all
these will be examined so as to formulated the best model for the operation of
manufacturing company in
with particular reference to TUYIL PHARMACEUTICAL INDUSTRY LIMITED,
1.3 SIGNIFICANCE
OF THE STUDY
Upon
the completion of the study, the benefits listed below are expected to be
derived.
–
The study will add to
the research previously down these probe areas.
–
To identify the
challenges faced by production personnel in the course of manufacturing the
desire output
–
To achieve a smooth and
economical operation of the production distribution system.
–
The study will finally
educate organization and the general public on the importance of production
planning and inventory control.
1.4 SCOPE OF
THE STUDY
The
research study will specifically focused on the production process ways in which
the company manages its inventory system to enhanced continuity and all other
activities involve in the conversion process till where finished products are
stores in readiness for dispatch to customer.
1.5 DEFINITION
OF TERMS
This
study is divided into five chapter control which the first chapter focused on
the introductory aspect discussing relevant section such as statement of
research problem, importance of the study, the objective and limitation of the
study.
Chapter two focused on the review of
relevant literature on the topic i.e it consider views of diffeent authors on production planning
and inventory control, role of inventory control, production system and its
types and also reasons for carrying out inventory was looked into.
Inventory control method of cost of
inventory is also elaborated. Also, different method of material sprcing are
also discussed.