Production Management

What are the Functions of Materials Management

Materials Management is one of the areas covered by the whole process of Management. The effective use of all manpower is looked after by the personnel Management. But for a balanced growth and efficient running of the enterprise it is necessary that the material costs and materials supply and utilization are so controlled.

Materials Management┬álead to the following areas of a business. Such as –

(i) the maximization of production and

(ii) the maximization of the margin of profit.

Materials Management helps in reducing material costs, preventing large amount of capital being locked up for a long period and improving the capital-turnover ratio.

Materials Management covers all aspects of –

(i) material cost,

(ii) materials supply, and

(iii) materials utilization.

To quote P.R. Gokam based on his Administration Staff College of India Notes on Materials Management, Hyderabad, November, 1967. p. 1:

Materials Management covers the whole range of functions involved in converting raw materials and ancillary supplies into finished products.

Functions of Materials Management:

The General Electric Company, U.S.A. has grouped together the following functions of materials management:

1. Materials Planning and Programme,

2. Purchasing,

3. Inventory Control,

4. Receiving and Warehousing,

5. Store keeping,

6. Value Analysis and Standardization,

7. Pre-design Value Analysis,

8. Production Control.

9. Transportation,

10. Materials Handling, and

11. Disposal of Scrap and Surplus.

In addition to the above functions, the following four major responsibilities of materials management may also be enumerated here :

1. Co-ordination between the above activities,

2. Keeping liaison between (a) designing, (b) engineering, (c) manufacturing, and/or (d) production,

3. Cost reduction, and

4. Marketing.

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