Professional Documents
Culture Documents
BY:MOHAMMEDSIRAJ KEMAL
ID NO; RSS-4779/19)
ADVISOR: ELSA
DILLA UNIVERSITY
DEPARTMENT OF MANAGEMENT
JANUARY,2023
DILLA ETHIOPIA
TABLE OF CONTENTS
Contents Pages
TABLE OF CONTENTS....................................................................................................................................i
CHAPTER ONE..............................................................................................................................................1
1 INTRODUCTION........................................................................................................................................1
1.1 Background of the study....................................................................................................................1
1.2 Statement of the problem.................................................................................................................2
1.3. Research question............................................................................................................................3
1.4 Objective of the study........................................................................................................................3
1.4.1 General objective........................................................................................................................3
1.4.2 Specific objectives.......................................................................................................................4
1.5 Significances of the Study................................................................................................................4
1.6. Scope of the Study............................................................................................................................4
1.8 Operational and conceptual definition..............................................................................................5
1.9 Organization of the Paper..................................................................................................................5
CHAPTER TWO.............................................................................................................................................6
REVIEW OF LITERATURE..............................................................................................................................6
2.1 Introduction.......................................................................................................................................6
2.2 Scope of Material Management........................................................................................................7
2.3 Classification of Materials..................................................................................................................8
2.3.1 Stock Control..............................................................................................................................8
2.3.2 Purchasing Sections....................................................................................................................8
2.3.3 Receiving Sections......................................................................................................................9
2.3.4 Store...........................................................................................................................................9
2.3.5 Account.......................................................................................................................................9
2.4 Objective of Material Management...................................................................................................9
2.4.1 primary Material Objectives.....................................................................................................10
2.4.2 Secondary Material Objective...................................................................................................10
2.5 Organization of Material Management...........................................................................................10
2.6. Cost Reduction in Material Management.......................................................................................11
2.6.1 Concept of Cost Reduction.......................................................................................................11
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2.6.2 Factors Contributing Cost Reduction in Material Management................................................12
2.6. Purchasing of materials..................................................................................................................12
2.6.1. Function of Purchase...............................................................................................................13
2.7. Process of Purchasing Materials.....................................................................................................13
2.8. Storage and Material Handling.......................................................................................................14
2.8.1. Storage.....................................................................................................................................14
2.8.1.2 Function of storages..............................................................................................................15
2.8.2 Material Handling.....................................................................................................................15
2.8.3 Factors affecting the selection of material handling equipment’s............................................15
CHAPTER THREE........................................................................................................................................17
RESEARCH METROLOGY............................................................................................................................17
3.1 Background of the Study Area.........................................................................................................17
3.2 Research Design...............................................................................................................................17
3.2.1 Target population.....................................................................................................................17
3.3 Source of Data.................................................................................................................................17
3.4 Data Collection Instrument............................................................................................................17
3.5 Target Population of the Study........................................................................................................18
3.6 Method of Data Analysis..................................................................................................................18
CHAPTER FOUR..........................................................................................................................................19
4. TIME AND BUDGET BREAKDOWN..........................................................................................................19
4.1. Time Breakdown.............................................................................................................................19
4.2. Budget Breakdown.........................................................................................................................20
REFERENCE................................................................................................................................................21
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CHAPTER ONE
1 INTRODUCTION
Material management covers a match wider filed and deal with all aspect of material supply and
utilization as well as cost were concerned with the entire range of functions which affect the
follow, conservation, utilization, quality and cost of materials(Anand, 2006).
The materials require serious attention in any work of production. Material means raw materials,
comprehends, subassemblies and finished products and the problem of housing development
project office material are out of stock and due to miss handling ,not softy and handling the store
and inventory control.(Anand, 2006).
It is clear that proper function of housing development project office should be more important
to its survival as an organization with its goals. Its operation must be continuously, sustained at
all times so that its plays economic and social role in the country, and that other organization
which are some who depend on it be running well. Controlling material management advocates
the assessment of all measure activities, which contribute material cost to a single material
management department (Sharma, 2008).
All cost about material will assign to a single head for responsibility. It is also management
activity concerned with the follow of material within and from the organization .It can be as view
as attain cost balance because storage of stock excess of stock with environment characterized by
risk and uncertainty (Sharma, 2008). Dilla town housing development project office for
constructing condominium houses acquired different construction materials like cements and
concrete materials.
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1.2 Statement of the problem
There were many challenges identified in the previous research works. Some of those challenges
are briefly discussed herein below. The first one is a loss of material due to miss handling of
material. Materials are out of the stock because of failure to identify reordering point precisely
(Anand, 2006). The other one is loss of material or damage and theft of materials.
Taking measures to minimize or eliminate loss of material (damage) and theft of materials and
clearly outlining material management policies and procedures of housing development project
were some of suggested solutions of problems in previous work.
Currently, the utilization of materials in Dilla Police commission office is a problem of
managing materials, transportation, purchasing troubles handling of tools to build the house and
to deliver the residence (Anand, 2006). Not only is this but also there is a problem of
warehousing materials. Because of this they lose their own identity and required advantage. The
material management of Dilla Police commission office differs from the past to now. Purchasing
department illicit materials price based on receipt from the original seller and lack of
responsibility to protect materials and unwillingness to build houses fast to deliver the people.
This situation is suitable for them to cheat government property. Material management objective
be able to deliver what customers wants. When and where they want it and at minimum cost to
the organization success (Tonya land, 1998).But as a matter of fact the survival and continuous
operation depends on the proper handling and materials along with other important resources of
the organization. It has definitely fall to provide its services properly due to the presents of
obsolete ,defective and damage materials has an influence on managing materials in the
store .Some materials were not storing their constant place.
There is a loss of material due to miss handling of material. Materials are out of the stock
because of failure to identify reordering point precisely (Anand, 2006).Material management
housing development office can use bid or question .It should mainly to find out if the office has
an applicable policies and procedures of managing material. And next, if that will the reality, to
investigate if there will be anything wrong with the techniques that leads to violation of the
general practice of material management and also, there are problems related to bid or question
which are the quantity, get of delivery and location where material it to be supplied can done in
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proper. So, to check whether up dated computerized technology and customer oriented product
will be use in the project office or not.
Therefore, the study will assess the challenges of material management housing development
project office in Dilla town. In order to minimize troubles of materials management and their
warehouse place and building place through leasing attentively.
1. What are challenges of material management housing development project office in Dilla
town?
2. What are the possible solutions or the measures that have been taken to minimize or eliminate
damage and theft of materials?
2. What are the material management policies and procedures of housing development project
office?
3. What are the practice of receiving and distribution of materials to those different places of the
project?
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1.4.2 Specific objectives
The specific objectives of this study will be:
To identify the measures that would have taken to minimize all eliminated damage and
theft of materials.
To identify the practice of receiving and distribution of materials to those different place of
the project.
To identify the methods that they follow to supply materials from different suppliers.
It is true that Dilla town housing development project contributes a lot for development for ones
countries economy by constructing cost efficient construction sector at large. As it is discussed
earlier, materials management is one of the important activities, which need special attention.
Hence, finding out the problems and making the possible recommendation on the material
management will be become essential to improve the effective and efficient use of resource.
It helps to points the problem of materials management; it will be extend the existing knowledge
and the area of the study. The study will be provide the most appropriate and recent information
on the challenges and prospects of material management housing development project office and
the finding of the study will be used for a future research purpose means that it helps to other to
use it as reference of material for other related studies.
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1.8 Operational and conceptual definition
Operational definition Material management is the process of planning acquiring storing
moving and controlling materials to effectively use facilities, personnel and capital
(Bollat, 2006).
Material handling is an art and science involving packaging and storing of substances in
form (Dobler, 1996)
Conceptual definition material management is discipline that describes the way that plan
and control the material due to the way of achievement its goal.
1.9 Organization of the Paper
This research will be organized in to five chapters. The first chapter contains introduction parts;
background of the study, statement of the problem, research question, objective of the study,
significance of the study, scope of the study, limitation of the study, key terminologies and
organization of the study. The second chapter concerned with review of related literature and the
third chapter will be concern with research methodology. The fourth chapter will be deals with
analysis and presentation of the study. Finally the fifth chapter will be deals with conclusion and
recommendation of the study.
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CHAPTER TWO
REVIEW OF LITERATURE
2.1 Introduction
Material management is a body of knowledge which helps the material to improve the
productivity of capital by reducing material costs preventing large amount of capitals being
lacked up or long periods and improving the capital turnover ratio. Material manager must drive
it objectives by understanding of local environments at the same time. Taken in to consideration
the human factors their attitude, sense of responsibility and there material make up and approach
to be ideas this factors together with the prevalent methods with good and points must be studied
in depth before anew producer solved It may be convenes the higher management about the
efficiency of sophisticated method but down the line with other who is concerned with the work.
the implementation of material management is take up with an open mind it would be either to
achieve the results sooner or later, which the field of material cost, supply and utilization the
opinion is divide as to what function should be included in material management (Sharma,
2008).Material management is the process of planning, acquiring, storing, moving and
controlling materials to effectively use facilities, personnel and capital (Bollot, 2006).
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According to (Sharma, 2008), the term material management has found wider acceptance
carrying all the entire function cost results in large sum of money save or loss. Material
management should be considered as a function of prime importance for our industrial economic.
Material management provides tools and techniques most of which are never simple to reduce
material cost. In addition, to reduce material cost efficient. Material management can also bring:
Reduction of foreign exchange requirements by getting the maximum value out of the available
foreign exchange by reducing the value of import thus contributing subistantly towards
narrowing the foreign exchange gap.
Reduction of cost of finished goods of high quality and maintaining the quality at reduce cost.
Material management is in a decision making with respect to design, procurement, storage,
issues, package and handling and accounting of material to get most out of every amount
invested in material. (Singh, 2008).
According to(Anand, 2008,) material management the administration and control of materials
used by a firm in the in the production process this has two main aspects:
The order and maintain of materials so as to ensure that adequate amount of materials are
available as an item thus enable production to a head without interpretation while at the same
time attempting to minimize stock holding costs.
Material handling is the physical movement of material from place to place their packaging and
their storage as the proceeds through varies production process material handling stocks to
minimize internal transport cost, damage to and wastage materials. Material management is
concerned with maintaining adequate supply of something (raw material, components, operating
supplies/utilities/) to meet anticipated demands economically. The function of material
management is to inshore supply of materials at a write time, write place, in write quantity, of a
write quantity, from write sources and at a write price and material management is concerned
with the management material follow in to, through and out of system (Singh, 2008).
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product. It is concerned with the planning and programming of material and equipment’s market
research for purchase par design value analysis procurement of all material packaging and
packaging material stores control and inventory, Value analysis disposal of scrap surplus and
salvage and operation research for materials (Sharma,2008).Material management is the most
important functional affairs for any organization of undertaking to achieve the best result are so
far as profitability is concerned with material supply utilization as well as costs. It is concerned
with the entire range of function, which a facts the follow conservation utilization quality, and
cost of materials.
To compile budgetary figures under various sub handlings by following classification numbers.
To raise separate purchase orders for different groups of materials by virtue separate purchase
requisition.
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To divided the work in the purchase section cache group handling certain class or category of
materials.
2.3.4 Store
To keep different types of goods separately as these are separate classes for different types of
goods.
To post the receipt and issues on the correct bin cards by following the class and code number
given on gin (goods in ward no to) and requisitions.
2.3.5 Account
To post gin (goods in ward no to) requisitions and others on the correct cards. To debit keeping
and issues under correct account heading by linking up classification with account heading. To
work out the value of different inventory i.e. capital equipment, tools, general stories and
production material.
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Ensuring low departmental costs and high efficiency and setting high ethical standards.
Setting high ethical standards.
By careful financial analysis, it can be shown that a 5% reduction in material costs will result in
increased profits equivalent to a 36% increase in sales. Reduction of materials costs is more
preferable by a manager then achieving in increase in sales. To increase sales lot of efforts is to
be made and as it deals with external environment and uncertainties, it will be easier to tackle the
problems of reducing the material cost (Anand, 2006).
Following are some of objective of materials management, which contribute to the achievement
of same over company objectives. If the contribution is made directly by the material functions,
we can it primary objective. If it is indirect and results from the material department assistance to
another department, we can it secondary objective.
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Material manager : the material is responsible for producing complete master schedule of
materials revilements to cover the whole of the production plan(sales forecast) for the whole
twelve months of the financial year or as for ahead on type of business (Ibid).
Stock control manager: the stock control manager receives both schedule and must measure what
tree stock will be available to meet the needs of the schedules. Then passes the requests for on
the material and parts requirements to the purchasing manager defining in detail how much and
at what rate be wants it to be delivered. So that, only the right amount of stock is available at all
times this avoiding over stock in or stock out (Ibid).
Purchasing manager: the purchasing manager has the responsibilities of purchasing everything
required by the stock control managers at the right price and applying on the purchasing
techniques required to achieve objectives (Ibid).
Production Control manager: the production control manager has revisable take of making
certain that this made parts are coming off the production lives on time to ensure complete
synchronization with the bought out parts either way money is necessary tied upon customers are
alienated by late delivers.
Store manager: the store manager is last but, by no means least in importance has the
responsibility for physical control as a stores and ware house as well as accountability at the end
of the financial years .he has a major role to play in integrating with the production control
manager to ensure that his requests are promptly meet to extract items to loaded on to the
production lines as required (Ibid).
Direct cost: direct cost of material is an important of elements in the total cost of products It
varies from 50-80%of the total unit cost. In the control of this material cost method engineers,
who deal with direct material can pay significant role.
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In direct cost: overhead expenses such as indirect labor. Indirect material, administrative and
selling expenses are controlling by budget.
Workers cost and workers overhead: this includes expenses on indirect, indirect material, power
rent repair and depreciation. They are all indirect expenses right from the receipt of order to the
dispatch of finished goods.
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Another author(Nair,1990), define purchasing as the function of buying machinery, tools,
general suppliers, raw materials etc. required by an organization. The major functions and
responsibilities include:
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1. Organization of purchase requisitions purchase requisition store documents listing the
requirements materials from the various stores written by the store kipper received by the
purchase department from various production centers and departments.
2. Clearance of purchase budget: this will be done by the purchasing department to check
whether the requesting department has the budget and authority to request the purchase.
3. Request for bid (quotation bid) quotation is invitation of potation suppliers to compute in
supplying the item required.
4. Selection and evaluation of suppliers :the process of selection of supplier involves two
basic aspects:
Searching for possible sources.
Short listing out of the identified sources.
5. Follow up and expenditure: follow up is remaining the supplier about the order and
finding out what the suppliers are doing to send the materials.
6. Inspecting receiving and storing: when material are sent by supplier, they will be received
inspected and stored.
7. Payments: when the goods are received in satisfactory condition, the invoices are
checked be for it is approved for the payment.
2.8.1. Storage
Storage is the safekeeping of goods in a warehouse or other depository and timely supply of
these goods. It can also defined as a management activity that involves the planning, organizing
and controlling of man, machine, and money towards the execution of the custodial, controlling
and supply of material function for the accomplishment of overall objectives of the
organization(Ballot,2006).
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Simplification physical counting
Adaptability : the load carrying and movement characteristics of the equipment should be fit
the materials handling problems
Flexibility: where possible the equipment should have flexibility to handle more than one
material refereeing either to class or size.
Load capacity: equipment selected should have great enough load carrying characteristics to
do the job effectively, yet should not be too larger and result in excessive operating costs.
Power : enough power should be available to do the job
Speed rapidly movement of materials within the limits of the production process or plant
satisfy, should be considered
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Space requirement the space requirement to install or operate materials handling equipment’s
is an important factors in its selection
Supervision required as applied to equipment selection, this refers to the degree of
automatically designed in to the equipment
Ease of maintenance equipment selected should be easily maintained at responsible cost
Environment: equipment selected must conform to any environment regulations
Cost: the consideration of the cost the equipment is an obvious factor in its selection.
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CHAPTER THREE
RESEARCH METROLOGY
17
3.5 Target Population of the Study
The target population of this study will all employees of Dilla housing development project
office with total number of 28 respondents therefore the study used a census study, because
information could easily will collect from total population.
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CHAPTER FOUR
4. TIME AND BUDGET BREAKDOWN
Problem
1.
Identification
Topic Selection
2.
Proposal Writing
3.
Proposal Summation
4.
Proposal Paper
5.
Defense
Data Collection And
6.
Process
19
4.2. Budget Breakdown
s.no description of items unit quantity unit cost in unit total cost
birr
1 secretary Page 35 7 245.00
2 Papers pack 1 180 180.00
3 Pen Piece 1 10 10.00
4 Pencil Piece 1 5 5.00
5 Ruler Piece 1 5 4.00
6 binding cost Piece 2 12 24.00
7 transportation trip 2 trip 100 200.00
sub total 668.00
contingency 10% 66.80
grand total 734.80
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REFERENCE
(C.sharma2008), material management and material handling: 7th edition, north
market, naisarak.
(K.singh, 2008), material management; laxms publication private limited, New Delhi.
(N.K. nair, 1990), purchasing and material management; 6 th edition, north markets
naisarak.
(P.gopalakrishmal, 1990), purchasing and material management; India edition, talamc-
grew- kill published limited company, New Delhi.
(R. Kothari, 2004), research methodology method and techniques; 2 nd edition, new age
international publisher, New Delhi.
(R. monczka. R.T rent and r. handfed, 2005), purchasing an integrated supply chain
approach; 9th edition south western published limited company, Arizona state university.
(R.tonyernold, 1998), and (2008), introduction to material management; 6thedition,
flemingcollege, termines.
(Robert Ballot, 2006), material management a result approach, 4thedition, North Carolina
state university.
(Sharma Anand, 2006), purchasing and material management; 4thedition, university book
stall,New Delhi.
(Stevenson William,1993),management science;6th edition ,Fleming college ,east taxes state
university
(W.Dobler and Donald, 1996), purchasing and supply management; 6 th edition, tataMc-
Graw hill published limited company, new delhi.
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