Computers Computers came to India in early 1950.

The computers of those days were quite different from the sleek models we see today. The speed was slow and size was very large. Advance in technology during these years brought about sweeping changes in the appearance and capabilities of computers. Technology level of a computer is understood by referring to the generation it belongs to. Generation I: use vacuum tubes Generation II: use of transistors Generation III: use of silicon chips as integrated circuits Generation IV: use of large scale Integrated Circuits chip, Super computers Generation V: artificial intelligence, speech understanding, handwriting recognition etc. Organizations all over the world use computer extensively as a power full management tool. Computers play significant role in materials planning which is an important function of materials management. Let us see the use of computer in materials management. Strengths of the computer: 1. Ability to handle complex and voluminous calculations 2. High speed of operation. What would be days for humans to perform a task would be minutes for a computer. 3. Storage of huge quantity of data and ability to access it whenever required. 4. Low priced versions of computer have made its usage extensive. 5. Computer is able to control processes taking structured decisions without human assistance. 6. Printing: computers can display and/or print the statements, tabulations, and graphs as required. Limitations of computers: 1. Security constraints: sensitive data stored or transported in the form of CDs, floppies or send through the net are susceptible to pilferage. 2. computer virus: deliberate attempts to corrupt the computer system 3. Machine and not a human: computer can not feel or judge. It is not sensitive to emotions. It has no ability to make a judgment 4. follows hard logic, has no power of discretion 5. Understands only program language. Needs an inter phase for interaction like a keyboard and monitor. System design and development: for using the computer in operations a meticulous system is to be devised. The system consists of inputs, outputs and logical process for carrying out the operation. The existing process of carrying out work is charted in the form of flow chart and trimmed to eliminate duplications. Inputs and out put requirements are clearly identified and defined. Inputs are codified for interphace. The process is logical and now all activities in the process are in logical sequence. The system so developed identifies the specifications for the next stage in which programming is done.

Programming: The system developed is to be understood by the computer for performing the desired task. As computer understands only some specific languages we have to write the steps computer has to take for performing the task assigned as a program. This program is to be written in a specific language, which can be understood by the computer. As per he specifications identified after developing the system a language is selected and program written. Computer is asked to perform a task and the results are checked against human calculations. This ensures correctness of the system developed and program written. Data for processing by computer: as first step all the items in the materials management system are to be coded and identified in a unique manner. Computer would not understand physical description. For creating this unique identification system, item code, supplier code, sales order, job order code, cost center code, purchase order codes etc. are to be finalized. Master files are to be created in the computer. These files have all the information about a particular set of related items. While processing, computer performs the assigned tasks by accessing data stored in master files. Areas of application: 1. ABC Analysis 2. Materials requirement planning 3. Price forecasting 4. Lead time analysis 5. Economic order quantity 6. Vendor rating 7. Economic order quantity 8. Stock statements 9. Materials budget 10. Stock accounting 11. Cost accounting 12. Order processing 13. Customer complaints processing 14. Scrap analysis Materials requirement planning: based on the sales forecast given by marketing, production schedule is made which is to be provided for by materials management. Quantities to be made are exploded into detailed parts with the help of bill of materials. Lead times are considered and procurement is initiated to ensure availability of inputs. A good MRP should ensure that there is neither stock out nor there is any excess. This process of complex calculations is handled by computers very efficiently releasing management time for higher level decision making. Stock accounting: is recording all transactions that affect stock levels. Computer automatically updates stock records and at any given time computer can tell the latest position with opening balance, transactions and closing balance of the item. That is called materials abstract. Cost accounting: in this phase, sales or consumption is reported cost center wise or job order wise. Revenues and relevant cost details are tracked and reported.

Order processing: all purchase orders are recorded and completed POs are identified. Hence at any given point of time outstanding order details can be accessed. While preparing the purchase order inventory positions are ascertained. Computers give, stock positions consumption patterns and such relevant information for management review of order policy.