Moisés Ureña 2015-1007

Manuel José 2017-0415

March 12th, 2020.
Material Management
Material Management is the planning, directing, controlling and coordinating those
activities which are concerned with materials and inventory requirements, from the
point of their inception to their introduction into the manufacturing process. It begins
with the determination of materials quality and quantity and ends with its issuance to
production to meet customer’s demand as per schedule and at the lowest cost.

The fundamental objectives of the Materials Management function, often called the
famous 5 Rs of Materials Management, are acquisition of materials and services:

     of the right quality

  in the right quantity
  at the right time
  from the right source
  at the right price

Importance of MM:
Material management is directly associated with the operational efficiency of an
organization. A good material management system ensures the availability right
materials in the production process with minimum wastage to cut losses. Here are the
few ways which show the importance of material management and how it influences
your project performance:
 Saving of labor time.
 Increase production.
 Reduces fault and damages.
 Ensures best control over inventory and best utilization of the resources.

Inventory Control:
Inventory control is the processes employed to maximize a company's use of inventory.
The goal of inventory control is to generate the maximum profit from the least amount
of inventory investment without intruding upon customer satisfaction levels. Given the
impact on customers and profits, inventory control is one of the chief concerns of
businesses that have large inventory investments, such as retailers and distributors.
Some of the more common areas in which to exercise inventory control are:
1. Raw materials availability.
2. Finished goods availability.
3. Work in process.
4. Reorder point.
5. Outsourcing.
Supply chain management
Supply chain management is the management of the flow of goods and services and
includes all processes that transform raw materials into final products. It involves the
active streamlining of a business's supply-side activities to maximize customer value
and gain a competitive advantage in the marketplace. SCM represents an effort by
suppliers to develop and implement supply chains that are as efficient and economical
as possible. Supply chains cover everything from production to product development to
the information systems needed to direct these undertakings.

Outsourcing
Outsourcing is the business practice of hiring a party outside a company to perform
services and create goods that traditionally were performed in-house by the company's
own employees and staff.
Outsourcing is a practice usually undertaken by companies as a cost-cutting measure.
As such, it can affect a wide range of jobs, from customer support to manufacturing.
Outsourcing, depending on the type of business and its application, can present various
advantages and disadvantages that must be analyzed when considering the impact that
this may have on the company.
Advantages:
- It allows to reduce manufacturing and equipment costs.
- Make more human resources and technology available to the company.
- It gives the company the possibility to respond and adapt quickly to changes in
the business.
- It allows the company to focus on the key areas of its business.
- It allows the company to be more competitive.
Disadvantages:
- Outsourcing costs may end up being higher than expected.
- The change of the supplier company can be economically and productively
negative.
- There is a possibility of losing control over production.
- The hiring company can see your copied work and your damaged business.
- It can contribute to the exploitation of the worker.
- Job loss.
Offshoring
Offshoring is the relocation of a business process from one country to another, typically
an operational process, such as manufacturing, or supporting processes, such as
accounting. Typically, this refers to a company business, although state governments
may also employ offshoring.
Advantages:
- Open a new market, consequently you have the opportunity to increase sales of
this new location.
- Facilitates the hiring of cheap labor.
- It reduces manufacturing costs
Disadvantages:
- Risk of loss of control of the company.
- Quality in production may be lost.
It is not easy to get qualified employees for certain positions
MPS
MPS (Master Production Schedule) is a plan for individual commodities to be produced
in each time period such as production, staffing, inventory, etc. It is usually linked to
manufacturing where the plan indicates when and how much of each product will be
demanded.
MRP
MRP (Material Requirement planning) is a production planning, scheduling, and
inventory control system used to manage manufacturing processes. Most MRP systems
are software-based, but it is possible to conduct MRP by hand as well. A MPS is the
virtually exact same thing as MRP the calculations are exactly the same. But there is
one distinction. MPS plans items that have “direct” demand—called independent
demand. Independent Demand means that its demand comes from Sales Orders, Service
Orders, or forecasts. The demand is directly from the customer requirements. MRP
plans items that have “dependent” demand—demand that is passed down because of the
need to produce an item.