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In the article “Who needs effective stock management, and why,” a non-fiction story was told about the low efficiency of an industrial enterprise in terms of net profit, largely due to inefficient management of material resources. The nonfictional story eventually got its continuation.
The head of the department of material and technical supply (DL) of this enterprise was trained on the open training module “Basics of effective inventory management” How to “. In the process of his training, I became aware of new details about the logistical situation of this enterprise, which have a significant impact on the management of material resources. As the logistical picture became clearer, an understanding emerged that the head of the DITC could be “one soldier in the field” who was put up by the company for a logistic battle for an optimal increase in net profit due to inventory management. Similar concerns, expressed by him, prompted the idea of describing the situation “As is” in the logistics of this company and developing recommendations “What to do” and “To do it”. As a result, a letter was written for the personnel director, whose competence is the function of personnel training, which is given below.
Description of the situation “As is” in the logistics of the enterprise and recommendations for training.
A study of the managerial and logistic situation of an enterprise that affects the quality of inventory management of material resources and the efficiency of an enterprise in terms of “Net profit”, conducted by discussing with the head of the DITC in the course of his training in the open training module “Basics of effective inventory management“ How to ”26 … July 27, 2012, in Kiev, allowed to detect factors that seriously impede the introduction of technology to efficiently manage inventory of material resources and the optimal increase is pure profits of the enterprise at the expense of the forces only Chief DITC.
Firstly, the top management of the enterprise has no agreement on the concept of managing the reserves of material resources and on other “How to” solutions for the logistics design of the enterprise. The concept of inventory management is the idea behind all inventory management solutions. Thus, the CEO requires that by the 15th of the current month all the material resources required to fulfill the production plan of the next month be delivered to the warehouse of raw materials, materials and components. This means that the CEO unconsciously implements the concept of maximizing the level of stocks of material resources, despite the MRP-management of them. At the same time, the financial director insists on applying a more flexible (economical) approach: up to the 15th of the current month, 50% of the total material resources of the next month should be in stock and 100% by the 30th of the current month. This means that he insists in essence on applying the concept of optimizing the level of reserves during MRP management. At the same time, the enterprise uses the inventory management tool from the concept of minimizing inventory levels (MRP) without knowing it: recalculating the production plan for finished products into a plan for material resource requirements and recalculating the plan for material resources into a procurement plan for material resources implemented using Excel in DLT, which are elements of the MRP-I-technology for managing the material resources of an industrial enterprise. Thus, the multidirectionality of the logistics thinking of top managers (maxi – opti – mini) leads to the situation of “Swan + Pike + Cancer” from the famous Russian folk tale in their practical actions. This is a “as is” situation.
So how should it be? Where should the right logistic thinking come from? It is formed at the expense of high-quality management training to the fact that, first of all, it is necessary in business for an optimal increase in net profit, positive net cash flow and market value of an enterprise.
The first factor is indicative and not the only symptom of the need for corporate logistic training for management and specialists and for carrying out systemic organizational and functional improvements (changes) in logistics at an enterprise.
The logic of building efficient logistics in an enterprise, i.e. logistics of increasing the company’s net profit, ceteris paribus, requires consistent selection (assignment) after the formulation of (1) the company’s highest economic goals and (2) the content of the corporate strategy: (3) logistics concept, (4) logistics goals, (5) logistics strategy , (5) inventory management concepts, (6) inventory management goals, (7) logistic positioning strategies for finished products, (8) inventory management strategies for each stock item position at each inventory location