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THE EFFECT OF INVENTORY CONTROL SYSTEMS ON PERFORMANCE OF
THE STORES DEPARTMENT
CASE STUDY OF JOINT MEDICAL STORES
BY NASSOZI SHADIA
BSP/ 10033/81/DU
RESEARCH PROPOSAL SUBMITTED TO THE SCHOOL OF BUSINESS AND
MANAGEMENT IN PARTIAL FULFILMENT OF THE REQUIREMENTS
FOR THE AWARD OF THE DEGREE OF SUPPLIES AND
PROCUREMENT MANAGEMENT OF KAMPALA
INTERNATIONAL UNIVERSITY
MAY 2011
DECLARATION
I NASSOZI SHADIA, declare that th e p roject p resented to Kampala
Intern a tiona l Univer s ity is m y original work and n ever been submitted to any
institution / or ganization for a ny award.
Signed: ..... ~ ... . ........ . ...................... . ........ . . . .... . ............................. . .. .. ..... .
NASSOZI SHADIA
Reg. No:BSP/10033/81/DU
Date:
..........••.. A-r.l .. { fS. J. . ?.-_ R .I. { .••.•..... ............•••.•.......•.•..•....•..•.•.•.••............•..•...
~~~~.~~~~.~.~'. ...... ~ ..................... ..................... . MR. HENRY OCHIENO BARASA
(Supervisor)
t]-Date: M_~ 0-D / r ..................... ~1 ................... J. ...................................................... .
ACKNOWLEDGEMENT
I wish to extend my sincere gratitude to each and every person that has seen
me through my effort to complete this piece of work. I would like to take special
mention the following particular persons who, assisted me in the following
ways.
With great affection I wish to extend my tremendous thanks to my supervisor
for sparing his valuable time to guide me as I carried out this research.
l am also thankful to my Aunt in London, Hajat Nansanga Madina for guiding,
advising and most of all availing me financial assistance when 1 needed it the
most.
Special thanks go to my mother Mrs. Namaganda Saidat for all she did, thank
rou for being there.
,ast but not least to my peers Farida, Brooklyn, Kenneth and Akim with whom
interacted a lot in the course of my study.
<'inally my thanks go to the Lord Almighty for without him who would I have
Jeen. His been my all in all and the reason for my success.
]LORY BE TO HIM
ll
DEDICATION
I do hereby dedicate this book to my dear grand mother Mrs. Najjuma Suzan
for the love, care and efforts she put to see me through from childhood to date.
May God bless her abundantly.
Ill
ACRONYMS
ABC Always Better Control.
FSN Fast moving Slow moving and Non moving.
VED Vital Essential and Desirable analysis.
JIT ,Just In Time.
IV
TABLE OF CONTENTS
DECLARATION .......................................................................................................................... i
ACKNOWLEDGEMENT .......................................................................................................... ii
DEDICATION ............................................................................................................................ iii
ACRONYMS ............................................................................................................................... iv
TABLE OF CONTENTS ............................................................................................................ v
LIST OF TABLES .................................................................................................................. viii
~HAPTER ONE .......................................................................................................................... 1
:NTRODUCTION ........................................................................................................................ 1
1.1 Background .......................................................................................................................... 1
1.2 Statement of the problem ................................................................................................ 2
; .3 Purpose of the study ......................................................................................................... 2
.4 Objectives of the study ..................................................................................................... 2
.5 Research questions ............................................................................................................ 3
. 6 Scope of the study .............................................................................................................. 3
.6.1 Area scope ......................................................................................................................... 3
.6.2 Subject scope .................................................................................................................. .3
.6.3 Time scope ........................................................................................................................ 3
. 7 Significance of the study ................................................................................................. -4
.8 Conceptual frame work .................................................................................................... 5
ome of them become expired and obsolescence ............................................................ 6
V
CHAPTER TWO .......................................................................................................................... 7
LITERATURE REVIEW ........................................................................................................... 7
2.0 Introduction ......................................................................................................................... 7
2.2 Problems facing the inventory control systems in the performance of stores
department ................................................................................................................................. I 0
CHAPTER THREE .................................................................................................................. 13
3.0 METHODOLOGY ............................................................................................................. 13
3.1 Research design ................................................................................................................ 13
3.2 Study population .............................................................................................................. 13
3.3 Sampling procedures ...................................................................................................... 13
3.4 Sampling design ................................................................................................................ 13
3.5 Sample size ......................................................................................................................... 14
3.6 Source of data .................................................................................................................... 14
3.6.1 Primary source .............................................................................................................. 14
3.6.2 Secondary source ......................................................................................................... 15
3. 7 Instruments of research ................................................................................................. 15
3.8 Data analysis ..................................................................................................................... 15
3. 9 Problems expected ........................................................................................................... 15
3.9.1. The researcher might lack time to carry out research ................................... 15
3.9.2. Lack of information ..................................................................................................... 15
3.9.3. The researcher might face the problem of negative attitudes ...................... 16
::!HAPTER FOUR ..................................................................................................................... 17
i>RESENTATION, ANALYSIS AND INTERPRETATION OF THE DATA .............. 17
+.Ointroduction ......................................................................................................................... 17
L l Section One: Background Information ...................................................................... 17
L2 Section Two: Response to the Research Questions ............................................. 20
+.2.1 Research Question One ............................................................................................. 21
1.2.2Research Question Two ............................................................................................... 23
+.2.3Research Question Three ............................................................................................ 25
VI
4.2.4Research Question Four .............................................................................................. 27
CHAPTER FIVE ....................................................................................................................... 29
SUMMARIES, CONCLUSIONS AND RECOMMENDATIONS ................................... 29
5.0Summarics ........................................................................................................................... 29
5.1 Research Question One ................................................................................................... 29
5.2Research Question Two ................................................................................................... 29
5.3Research Question Three ................................................................................................ 30
5.4Research Question Four .................................................................................................. 30
5.5Conclusions ......................................................................................................................... 31
5.6Recommendations ............................................................................................................. 32
APPENDICES ............................................................................................................................ 33
Appendix I: Research plan/ time frame .......................................................................... 33
Appendix II: The budget cost of the research project ................................................. 34
REFERENCES .......................................................................................................................... 35
~UESTIONNAIRE .................................................................................................................... 37
:NTERVIEW GUIDE ................................................................................................................ 40
Vil
LIST OF TABLES
Figure 1: Gender distribution of Respondents .................................................................. 18
Figure 2: The distribution of respondents by their marital status ............................ 19
Figure 3: Distribution of respondents' position with the company ........................... 20
Figure 4: Whether the respondents thought there was a common .............................. .
relationship in the organization 21
Figure 5: Whether there was a best measure on inventory management in the
performance of stores department ..................................................................... 22
Figure 6: Whether inventory control systems have an effect on the performance
of the stores department ....................................................................................... 24
0 igure 7: How the inventory control systems affect the stores department ........... 25
"igure 8: Whal are the difficulties facing inventory control systems in the
performance of stores department at Joint Medical Stores ...................... 26
'igure 9: Whal are the solutions to the inventory control problems at Joint
Medical Stores .......................................................................................................... 27
Vlll
ABSTRACT
The study sought to establish the effects of inventory control systems on
performance of the stores department where by inventory control system is the
planned methods of managing and storing the material at the lowest possible
cost with out affecting the production and distribution schedule, it also
involves the monitoring of the stock movement where as stores department is
the department in an organization where goods purchased kept or stored to be
dispatched to the intended use the organization. The reason for this study is to
evaluate the type of inventory control systems in use at the joint medical
stores.
The study was driven by four objectives, to find out the relationship between
inventory con lrol system and the performance of the stores department at joint
medical stores, to find out the effect of inventory control on the performance of
the stores department at Joint Medical Stores, to find out the difficulties in
nventory control systems at Joint Medical Stores and to make
-ccommendalions for their solutions.
l'o achieve these objectives the researcher sampled 9 respondents from Joint
vledical Stores. The study utilized qualitative research methods two data
:ollections instruments were used: structured questionnaire and structured
nterviews. The collected data was presented in tabular and figurative forms.
IX
CHAPTER ONE
INTRODUCTION
This chapter is to give a brief explanation of the study that is giving the
background of study the problem, giving the objectives of doing the study and
research questions that will give me in the study. Looking at the scope of the
study for example the content scope, geographical scope and give frame scope
in this chapter also the significance of the study benefit and the conceptual
frame work has to be shown. This shows the negative effects and the positive
effects of the independent variable and their relationship.
1.1 Background
Inventory control system is the planned method of managing and storing the
material at the lowest possible cost without affecting the production and
:listribution schedule, it also involves the monitoring of the stock movement.
!'he activities include;
3etting out t.he investment partners and its regulation as per individual
:ompany's requirements
nventory control systems are comprised of ABC analysis, VED analysis and
cSN, analysis.
,lores department 1s the department in an organization where goods
>Urchased kept or stored to be dispatched to the intended use in the
,rganization.
'he reason for this study is to evaluate the type of inventory control system in
1se at the Joint Medical Stores.
To find out why the reasons for the poor performance by the store department
in controlling inventory.
To make recommendation after the study on how to overcome such poor
performance.
1.2 Statement of the problem
Despite the growth and expansion of Joint Medical Store in Uganda, the
performance of the stores department on inventory control systems has
lremendously declined.
1.3 Purpose of the study
The purpose of the study is to find out the difficulties facing the performance of
the stores al ,Joint Medical Stores in controlling inventory.
1.4 Objectives of the study
ro find oul the relationship between inventory control system and the
Jerformance of the stores department at Joint Medical Stores.
l'o find out the effect of inventory control on the performance of the stores
iepartment al Joint Medical Stores.
''o find out the difficulties in inventory control systems at Joint Medical Stores
'o make recommendations for their solutions.
2
1.5 Research questions
a) What is the relationship between inventory control systems and the
performance of stores department?
b) How is the inventory control system affecting the stores department?
c) What are lhe difficulties m the inventory control systems at Joint Medical
Store?
d) What are the solutions to the inventory control problem?
1.6 Scope of the study
The research will cover different areas including area scope, subject scope and
time scope.
1.6.1 Area scope
The research will cover the inventory control systems in the performance of the
stores deparlment at Joint Medical Stores.
1.6.2 Subject scope
This research will cover the inventory control systems in the performance of the
stores deparlment at Joint Medical Stores.
L.6.3 Time scope
!'his scope will cover 3 months starting from February to April.
3
1. 7 Significance of the study
This research is significant to the researcher in the sense thal it will improve
her research skills when making research since it is not an easy task to carry
out research.
ll is not only for improving on researcher's skills but it is also a partial
fulfillment in the academic for the award of a bachelor's degree which shows
that the researcher qualified for that degree.
For researchers it is important in that they will be guided on how to work and
conduct their research in future.
4
1.8 Conceptual frame work
Independent Variable
Inventory Control System
Positive effects
• Reduce labor force.
• Project against local time
uncertainty.
• Keep down capital investment
• Greater accuracy.
• Reduce the risks of supply
failure.
• Faster to access information.
With good inventory control
System the performance of
stores department will
improve through:
• Reduced lead time
• Popularize Standardization
of material being carried m
the store house
Negative effects
• Expensive to install
• Tied up capital
• Requires constant
specialists
• Expensive to apply
5
Dependent
Variable
Performance
of the stores
Department
The positives effect of the proper inventory control system is that it has
reduced labor force. This is achieved when all or some of the inventory control
tools like ABC, VED has been properly used in the stores thus achieving the
performance of stores department.
Projects against lead time uncertainly. This is the time between placing an
order and receiving goods or stock. When there is proper inventory control
systems, it means that goods are available in the store and when the
customers place any order it doesn't take along time before the organization
delivers goods to their customers and this is most achieved when the
organization uses bar coding system in storing the goods so that it can know
the goods that are in shortage hence proper performance of stores.
Effective inventory control systems reduce the tied up capital smce the
organization is making properly and goods are issued or flowing smoothly.
On the other hand, the negative effects of the inventory control systems in the
performance of stores department are as follows:
fied up capital: This is experienced when there is improper inventory control
,ystem. This means that the organization has not followed / implemented the
Jroper technique of inventory like ABC thus goods are stored in excess and
some of them become expired and obsolescence.
6
CHAPTER TWO
LITERATURE REVIEW
2.0 Introduction
The inventory control system m performance of stores department at Joint
Medical Stores has reduced lead time (time between ordering and delivering of
goods). When time is shorted, that is between ordering and receiving goods, it
enables Joint Medical Stores to supply medicine in time so as to run its
operation.
Ensuring thal administration of inventory control systems function is provided
efficiently. Through such means, as employment of professional inventory
:ontrol staff; education or paper work, tied up capital and utilization of
l:cchnology in case of bar coding system. This helps the administration m
:arrying out its activities more efficiently and effectively in performance of
,lores department.
Vlonitoring performance of venders with regard to quality over all costs and
-eiiability of delivering goods in respect to undertaking vendors have to ensure
.hat goods are of good quality and should not be hazardous to users (A Jian
Jan Wede 2002).
~esearching and advising on supplies to be able to meet the value of
1ndertaking lhe inventory control systems in the performance of stores
lepartment is to make justified research about the available possible inventory,
,valuate them and screen them using evaluation and screening method.
Keneth Lyson, Brian Farrington 2008)
7
Inventory as stock as stock piles of raw materials supplies, components, work
in progress and finished goods that appear at numerous points through a
firm's production and supply channels. They are frequently found in such
place as ware houses, as yards, shop floors transportation equipments and on
retail stores helves (Ronald H.B 2004).
Inventory in most businesses is very large asset. In many manufacturing
companies; it is the largest asset on the balance sheet and often accounts for
26% of the asset total. It consists of goods owned by the business and held
either for use in the manufacture or products a waiting for sale (Terry H 1993).
It is important in determining the competitiveness of organization. On average
industrial firms or organization spent more than half of the purchase dollars on
inventory (USA Dureau of census 1985).
Inventories can effectively serve to mitigate the problem of minimizing maJor
:hanges in the size of the work force under conditions of fluctuating demand.
!f, for example, it is believed that demand for a firm's product or products will
:!ecrees in the near future, the additional costs involved in inventorying excess
xoduction may be entirely or in part off set by avoiding lay offs (Donald Del
Viar 1985).
nventory control systems are important with the primary objectives as outlined
Jelow;
~o m1mm1ze idle time caused by shortage of inventory and non availability of
nvestments m inventories, inventory carrying and obsolescence losses (N.A
,aleemi 2007) maximize the level of customer service by avoiding under
:tocking.
8
1. 1 How inventory control systems in the performance of stores
department are measured
There are various approaches or techniques used in measuring inventory and
these include;
ABC Analysis: This is the basic analytical materials management tool. It calls
upon the top management to place its efforts where the results will be greatest,
it is a selective approach popularly known as Always (A), Better (B), and
Control (C). Its genesis lies in the characteristic distribution of priority which
enables the management to exercise control over managed subjects according
to the priority fixed for the purpose on selective basis since is neither possible
nor worth while to pay equal attention to all the managed subject in any
organization. [t always control the best then better and lastly the good (Richard
J Shonberrgcr 1981).
FSN Analysis: This is based on the movement of items in the store house.
[terns are classified as Fast moving (F), Slow moving (5), Non moving (N). This
~lassification is done on the basis of consumption pattern of the items. It is
1lso useful in preventing obsolescence of and facilitates timely control. This is
:he technique that measures the inventory in the performance of stores
:lcpartment (N.A Saleemi 2007).
vED Analysis: This is the approach that contributes to the performance of
,tores department. It's fully stretched as vital essential and desirable analysis.
!'his applicable to spare parts, spares classified as V (vital) stocked adequately
.o ensure smooth plant operations. They are those that cause havoc and may
1mount to stoppage of work in the organization it they are not available the
.ime they arc required spares classified as E (Essential) can be sufficiently
;tocked to ensure a regular flow but care should be taken that if sufficient
;tock of E items are not available then it may fall upon to the organization
9
spares classified as D (Desirable) are those which can easily be bought from the
market as and when they are needed by the organization (Gordon B.C 1997).
JIT Analysis (Just In Time): This is simple but powerful. It eliminates waste
by cutting excess capacity or inventory and removing non value added
activities in operations. When the organization reduces the number of supplies,
it increase long term commitment, to obtain improved quality and this
technique is based on the following assumption;
ifa:
The demand rate for the item is constant (for example always 10 units per day)
and known with certainty, lead time that is the time between placement and
receipt of the order is known and constant, replenishment is instantaneous. In
other wards the inventory from another arrives in one batch at one time in an
organization to ensure customers satisfaction and the stock outs (shortage) can
be completely avoided if orders are place at the right time (Mark D. Hanna
2001)
i.2 Problems facing the inventory control systems in the performance of
,tores department
,ack of clear definition of inventory control systems and performance
:ffectiveness and efficiency are not clearly defined or used.
Jifferences in the scope of the organization inventory control system is not a
10mogeneous activity and such factors as status policies organization policies
md procedures differs widely from firm to another and these differences
nclude; development of uniform measurement systems. So they destruct
tttention given to inventory.
10
Co-ordination with other department is difficulty to measure as important as it
is in inventory control systems in the performance of stores department
measures that have been used include; number of complaints from other
department managers regarding inventory control in the performance of stores
department.
Creative performance is difficult to be appraised however questions which
might be asked are; what has been achieved through value and analysis has
the stores department been successful in locating the alternative economic
resource? Has the department with its suppliers and inventory control system
contributed to productivity and efficiency of the organization.
Policy development is another area which does not consider its self to
qualitative measurement. Few organizations have though their policies criteria
which might be used in judging quality and inventory control, failure and his
may be due lo poor source of selection, poor storage systems delivery failure,
:hanging systems, frequently late requisitioning delaying to pay their
:ustomers, (supplier) and the stores department workers. These influence
inventory control systems in the performance of store department in a variety
Jf ways by their actions yet the complex interrelationship makes it difficult to
,egregate the effect that influences inventory control system.
nadequate slorage facilities for the stock usually stock keeping compames
1ave got small limited storage building which makes it hard for the stock
;ontroller with in the organization especially in times of mass production and
ess sales at the market.
)amages on the stock caused reckless waters is yet another problem smce
,ome stock like the medicine are delicate which becomes costly to the firm.
I I
These affect inventory management in the performance of stores department in
various ways and the complex inter relationship make it hard. Difficult to
separate the effects that influence inventory control.
12
CHAPTER THREE
METHODOLOGY
In this section, an attempt to light the context, scope and area of the study in
Jrder to produce a foundation against which the findings of the study will be
::tssessed according to reliability, validity and conclusion drown. Thus the
section will be designed to analyze data study population, sampling
procedures, data collection and processing anticipated problems.
3.1 Research design
fhis study will use cross sectional design using Joint Medical Stores inventory
:ontrol system in the performance of store department as the case study.
3.2 Study population
rhe survey population will include stores manager, marketing department,
accounting department and staff of Joint Medical Stores.
3.3 Sampling procedures
The sample will be arrived at by visiting Joint Medical Stores and using
appropriate stratified sampling to get the result.
3.4 Sampling design
To get the sample that is the representatives from the whole population. The
researcher will use the appropriate stratified sampling as shown in the figure 1
below.
13
Department Population
Store managers 7
Marketing 4
Accounting department 5
Total 16
3.5 Sample size
Due to limited time and high cost the sample size will be carried out in the
selected number as shown in the table 2.
Department Population No. of preventatives out of total
7 4 Store managers
4 2 Marketing
5 3 l\.ecounting department
fotal 16 9
3.6 Source of data
l'he data will be collected from both the primary and secondary source.
J.6.1 Primary source
'he data will be collected from the sample population chosen in table (2) above
1sing questionnaire to be designed; face to face interviews, filling in and
lbservation.
14
3.6.2 Secondary source
Information will be got from maintained organization internal records. This will
be supplemented by the findings extracted from books, magazines newspaper,
internet and available libraries around Kampala.
3. 7 Instruments of research
A questionnaire will be used as a base tool of data collection. The researcher
will formulate the questionnaires and administer them to the target
respondents as specified in the table above. The reason for using this method
tool is quick and easy.
The researcher will also use the interview method to obtain data from the
expected respondent specified in the table 2. It is used because it is not time
consuming, it helps to get first hand information and it is less costly.
3.8 Data analysis
fhe data collected by both methods will be evaluated and analyzed. This 1s
jone to ensure accuracy adequacy and reliability of data.
3.9 Problems expected
rhe researcher might lack finance. This is the money to finance the operation
.hat will be used in carrying out research it self e.g. money to photocopy
iuestionnairc, money to transport, money to buy airtime and money for typing
he work and bidding the research book. This may be due to poor budget.
1.9.1. The researcher might lack time to carry out research e.g. Time to
:ollect questionnaire from the organization where she is making research from.
1.9.2. Lack of information on the researcher being researched on. This will
Linder her research because she can not access any information about the
ubject matter being researched on in the organization.
15
3.9.3. The researcher might face the problem of negative attitudes toward
the respondents where the research is carried from.
16
CHAPTER FOUR
PRESENTATION, ANALYSIS AND INTERPRETATION OF THE DATA
4.0 Introduction
This chapter of the study systematically presents the results that were
obtained from the research that was conducted. The results are qualitatively
presented. The analysis and interpretation follows tabular presentation to
some stages and the interview results from the respondents are also presented
lo supplement the qualitative presentation.
The presentation of the study is guided by the research questions and face to
face interviews that guided the study. The background information of the
respondents however is also presented. Hence forth, the presentation is
divided into two sections, where section one presents the background
information of the respondents, while section two represents the results of the
study according to the interview guide and the research questions that guided
:ollection of data. The presentation of the data follows in the following
:liscussion.
i.1 Section One: Background Information
l'he presentation of this data as already pointed out is done 111 two sections.
rhe current section presents the background information of respondents. The
·esearcher felt this information was important because the respondents'
Jackground with the organization which determines their ability to posses the
equired information and subsequently determined the necessity of the
csearcher to probe for any detail and establish sufficient information with the
espondents. Concerning gender distribution the researcher established the
ituation as presented in Table (1).
17
Fie:ure I: Gender distribution of Resoondents Respondents Percentage
Male 5 60
F'emale 4 40
Total 9 100
Source: Primary Data
As can be observed from table (1), the respondents were unevenly distributed.
That is 5(60%) of the total respondents were male as compared to 4 (40%) who
were female. The results indicate that during the survey, both sexes were
3.ccessible. This made it possible for the researcher to interact with them using
the face to face interviews.
fhe researcher also endeavored to explore the marital status of the
-espondents. This variable was deemed worth establishing by the researcher
Jecause the marital status of the individual determines his/her ability to
Jossess adequate information the results of marital status of the respondents
ire presented in table (2)
18
Fie:ure 2: Th e d1stn ut10n o respon ents )Vt eir marita status . b . f d b h . Respondents Percentage
Single 3 30
Married 6 70
Other - -
Total 9 100
Source: Pnmary Data
Table (2) basically indicates that the majority of the respondents 6(70%) are
married. While 3 (30%) are single and that there are no others.
The distribution in Table (2) however indicated to the researcher that the study
involved respondents of various marital status which gave her the opportunity
lo interact with them and understanding their perceptions basing on the study.
fhe researcher also investigated the respondents' positions m the company.
fhis information was regarded important by the researcher because the
·cspondents' different positions would eventually relate to their ability to
Jossess adequate information. The results are presented in Table (3) of the
,tudy.
19
Figure 3: Distribution of resoondents' oosition with the compan
Respondents Percentage
Store Managers 4 45
Marketing Managers 2 25
Accounting Managers 3 30
Total 9 100 .
Source: Primmy Data
As expressed by table (3), the respondents' positions at Joint medical Stores
was unevenly distributed. That is 4(45%) were store managers as compared to
2(25%) who were marketing managers and 3(30%) were accounting managers
J'he results generally indicate that the respondents were of different positions
.n the company. During the face to face interview most of the respondents
ndicated that most employees sought for greener pasture corresponding with
.he cost of living in Kampala today.
)espite the expressions the researcher was confident because she was able to
ibtain various views from the employees with the company.
~.2 Section Two: Response to the Research Questions
'his study was basically guided by four research questions and an interview
;uide. The verification of the Research Questions was guided by the conditions
hat described the data. After presentation of the univariate results, the
·esults from the face to face interviews are also presented for clarity.
20
4.2.1 Research Question One
The first research question of this study was derived from the first research
objective. The question sought to investigate the relationship between
inventory control systems and the performance of stores deparlment at Joint
Medical Stores, in order to get answers to ascertain this research question, the
researcher inquired from the respondents their perceptions on a number of
issues. These issues included:
Whether they thought there was a common relationship in the organization,
and whether there was a best measure on inventory management in the
performance of stores department. Descriptive statistics of the study were also
c1nalyzed and indicated. For example, the researcher was interested in
investigating the number of personnel required in handling inventory and
'Csults are presented in the following discussion.
·'igure 4: Whether the respondents thought there was a common ·elationship in th · f e organ1za 10n
--Respondents Percentage
,trongly agrc C 2 22.2
~gree 2 22.2
kutral 3 33.4
)isagree 1 11.1
:trongly disag ,ree 1 11.1
'otal 9 100
;ource: Primmy Data
21
According to the expressions of the respondents in Table (4) it can be observed
that the majority of the respondents throughout that there was a common
relationship at Joint medical Stores that is 4(44.4%) agreed. Yet 2(22.2%) of the
respondents felt that there was no common relationship at Joint medical
Stores and the 3 (33.4%) of the respondents were neutral on the matter.
When the researcher contacted the respondents during the face to face
interviews, more interesting issues about the relationship between inventory
control systems and the performance of stores department at joint medical
Stores was availed which made the researcher to investigate whether there was
a best measure on inventory management in the performance of stores
department and the results are presented in Table (5).
l'igure 5: Whether there was a best measure on inventory management in the performance of :,tores department
-Respondents Percentage
:; trongly agree 4 44.5
\ gree 2 22.2
eutral 2 22.2
) isagree 1 11.1
otal 9 --
100
,ource: Primmy Data
22
According to the expressions of the respondents in Table (5), it could be
observed that 6(66.7%) of the respondents agreed that there is a best measure
on inventory management in the performance of stores department it is total
order fill and accuracy of requirements 3(22.2%) of the respondents remained
neutral on the issue and 1(11.1) disagreed on the issue. During the face to
face interviews respondents expressed the best measure on inventory
management in the performance of stores department which they said that it
was Accuracy of requirements which eliminates waste by cutting excess
capacity or inventory and removing non value added activities in operations.
However, the respondents who remained neutral felt that it depended on what
other respondents meant concerning the best measure on inventory
management.
4.2.2 Research Question Two
l<'rom the second objective of the study, the researcher presented a researcher
iuestion, it is this research question, which guided the study in order to get
1ppropriate answers to her research question; a number of elements were
,ubjected to the respondent to solicit for their perception of the variables in
:iuestion.
<'or example, the researcher solicited respondent's opm10n on the effect of
nventory control system on the performance of the stores department at Joint
vledical Stores. The results to this study were analysed by generating tables
md percentages which were used to make the comparison of the perceptions
ts the following presentation depicts, on whether inventory control systems
iave an effect on the performance of the stores department at Joint Medical
,tores, the results to this research question are presented in table (6).
?' _.)
Figure 6: Whether inventory control systems have an effect on the performance of the stores department
Respondents Percentage
Agree 4 70
Never 2 30
Total 9 100
Source: Primary Data
According to table (6) the expressions of the respondents that is 6(70%) stated
that there was an effect of inventory control systems on the performance of the
stores department at Joint Medical Stores and this effect includes making
supply more efficient by reducing or removing waste associated with inventory
ctnd inaccurate forecasts. This implies reducing the response time to demand
rom the consumer and holding less physical inventory, moving from a push to
Jul! system. However, 3(40%) of the respondents indicated that there is no
,ffect of inventory control systems on the performance of the stores
iepartment. The researcher sought to find out whether the respondents were
)iased on revealing the information for fear of being dismissed from the
:ompany, however, the respondents expressed dissatisfaction on this line of
1uestioning hence the researcher dropped it.
'he results of table (6) enticed the researcher to establish how the inventory
:ontrol systems affect the stores department. The results are depicted in table
7).
24
_l'[gure 7: How the inventorv control svstems affect the stores department Respondents Percentage
Shortage lead time 3 30
Improved speed and accuracy 2 25
Efficient replenishment 4 45
Total 9 100
Source: Primary Data
Table indicates a wide perception of respondents, 4(45%) of the respondents
felt that inventory control systems lead to efficient replenishment which
shorten order cycles, reduce stock holding and eliminate unnecessary costs
within the replenishment process in the stores department. 2(25%) of the
:espondents felt that inventory control systems improve speed and accuracy of
:!istribution by using vender managed inventory whereby the supplier becomes
·esponsible for assessing the level of demand and ensuring thal sufficient stock
s supplied lo maintain optimum inventory levels in the stores department.
·lowever, 3(30%) of the respondents felt that inventory control systems shorten
cad time (this is the time between placing and order and the period taken to
·eceive the stock.
k2.3 Research Question Three
'rom the third objective of the study, the researcher derived research question
1umber three. The researcher question sought to find out the difficulties
icing inventory control systems in the performance of stores department at
oint Medical Stores.
25
To get the answers to this question, a number of elements were placed to the
respondents among which the following highlights are important. The results
to this study were analyzed by generating tables and percentages which were
used to make the comparison of the perceptions as the following presentation
depicts. The descriptive statistics of the study were also analyzed and
indicated similar results.
For instance, the researcher solicited respondents' views on the difficulties
facing inventory control systems in the performance of stores department at
,Joint Medical Stores. The results are presented in the table (8).
Figure 8: What are the difficulties facing inventory control systems in the performance of stores Je nartment at Joint Medical Stores
)a mages on Stock
,I mited space
problem 1/o
10 ta!
',ource: Primary Data
Respondents
4
2
3
9
Percentage
45
25
30
100
\ccording to table (8), the respondents' that is 4(45%) were on the view that
lamages on the stock as the main problem facing the inventory control
ystems in the performance at Joint Medical Stores. 2(25%) of the respondents
::lt that limited space for the stock was a problem facing inventory control
ystems in the performance of stores department due to the limited storage
,uilding. 3(30%) of the respondents felt that the problems were not there.
26
However hard work was required. During the face to face interviews the
respondents stated that the biggest problem that they face was that damages
on the stock caused by reckless workers since medicine is delicate which
becomes coslly to the firm, they further stated that inadequate storage facilities
as another problem which is caused due to the small limited storage building
which makes it had for the stock controller within the organization especially in
terms of less sales at the market.
4.2.4 Research Question Four
F'rom the fourth objective of the study the researcher derived question number
four. The research question sought to find out the solutions to the inventory
:antral problems. The results to this study were analysed by generating a table
1nd percentages which were used to make the comparison of the perceptions
cts the following presentation depicts.
The descriptive statistics of the study were analysed and indicated similar
·csults. The researcher sought to find out what are the solutions to the
nventory control problems the results are depicted in table (9).
~~re 9 Wh at are t h e so ut10ns to t e mven orv con ro pro I . h . t t I bl ems a om e 1ca t J . t M ct· I St ores Respondents Percentage
'raining the employees 3 30
,dopt the JIT technique 4 45
'.educe labour force 2 25
'otal 9 100
;ource: Primary Data
27
According to table (9), the majority of the respondents 4(45%) felt that if they
adopted the ,JIT (Just in Time) Technique then problems like limited space
would be minimized. Training the employees on how to handle the delicate
stock was thought to be the answer by 3(30%) of the respondents. However,
2(25%) of the respondents decided that labour force should be reduced.
28
CHAPTER FIVE
SUMMARIES, CONCLUSIONS AND RECOMMENDATIONS
Introduction
The current chapter of this study presents the discussions of the results
derived from the data presented in Chapter Four. The summaries lead into
varying conclusions and a number of recommendations are subsequently
derived.
5.0 Summaries
fhe following are the summaries on the findings which are based on the
interview guides and the research questions that guided the study.
5.1 Research Question One
!'he first research question of this study was derived from the first research
ibjective. The research question sought to investigate the relationship between
nventory control systems and the performance of stores department at Joint
v'ledical Stores in order to get answers to ascertain this research question, the
·esearcher inquired from the respondents their perceptions on a number of
ssues. These issues included whether they though there was a common
'Clationship in the organization, and whether there was a best measure on
nventory management in the performance of stores department.
i.2 Research Question Two
'rom the second objective of the study, the researcher presented a research
1uestion. It is this research question, which guided the study, in order to get
29
appropriate answers to this research question, a number of elements were
subjected to lhe respondents to solicit for their perception of the variables in
question. For instance, the researcher solicited respondents' opinion on the
effect of inventory control system on the performance of stores department.
The positive effects that were mentioned include making supply more efficient
by reducing lhe response time to demand from the customers and keeping
down capital investment.
5.3 Research Question Three
Prom the third objective of the study, the researcher derived research question
number three. The research question sought to find out the difficulties facing
.nventory content systems in the performance of stores department at Joint
Vledical Stores. The get the answers to this question, a number of elements
Nere placed to the respondents among which the following highlights are
mportant. For instance, the researcher solicited respondents' views on the
1bove issue which problems were identified by the respondents, one of the
)roblems were identified by the respondents one of the problem was damages o
he stock caused by reckless workers since medicine is delicate which becomes
:ostly firm, lhey further stated that inadequate storage facilities as another
Jroblem which is caused due to the small limited storage building.
,.4 Research Question Four
'ram the fourth objective of the study the researcher derived question number
Jur. The research question sought to find out the solutions lo the inventory
ontrol problems. The solutions that were identified by the respondents during
he interviews included. Training on the employees on how to handle the
elicate stock, adoption of the just in time technique which would eliminate
roblems like limited space in the company and reduction of labor force.
30
5.5 Conclusions
From the study results, a number of conclusions were made which include the
following:
1. The results on research question one indicated that there is a common
relationship between inventory control systems and the performance of stores
department Joint medical Stores due to the use of JIT (Just in Time) technique
which reduces lead time between ordering of the stock and receiving it. The
best measure on inventory management in the performance of stores
:iepartment includes total order fill and accuracy of requirements hence this is
:lelivering of Lhe right stock at the right agreed time to the company.
2. From the study, the results on research question two indicated that
nventory control systems are affecting the stores department. Therefore
;upply should be more efficient by reducing or removing cost associated with
nventory and inaccurate fore casts. This implies reducing lead time and
10lding less physical inventory. As a result tied up capital is eliminated from
he stores department.
I. From Lhe study, the results on research question three and four
ndicated thaL there are difficulties faced by inventory control systems in the
ierformance of stores department. These difficulties range from damages on
tock and limited space. Therefore Joint medical Stores should develop
trategies thaL can curb such difficulties, on the issue of damages on stock, the
mployees in the stores department should be trained on how to handle the
tock and on the issue of limited space, the electronic procurement method
hould be adopted which reduces the lead time and the risks of supply failure.
31
5.6 Recommendations
1. From the study, it is recommended that techniques like the ABC analysis
and the JIT analysis should be put in place in order to access information
faster, reduce the risks of supply failure and have a greater accuracy of
inventory control systems on performance of the stores department.
2. There is a need for a common relationship between inventory control
,ystems and the performance of stores department in order to have effective
ielivery schedules, better quality stock and better communication systems.
32
APPENDICES
Appendix I: Research plan/ time frame
Activity reviews literature for the research proposal week Month
Consultation with the supervisor 3 February
Construction of questionnaires 1 February
Data collection 1 March
Data processing and analysis 1 March
Nriting editing 1 March
:::onsultation with the supervisor 2 April
,ubmission of research report 1 April
33
Appendix II: The budget cost of the research project
Items Quantity Unit Price Amount
Secretarial
Photocopy 13 300 3,900
Typing 10 1,000 10,000
Binding 10 3,000 30,000
43,900/=
Rerun of papers 2 9,000 18,000
\/ote books 2 2,500 5,000
CciJe folder 1 300 300
?ens 5 300 1,500
:':nvelopes 10 200 2,000
26,800/=
<'ield work
rransport costs 70,000
relephones 40,000
110,000/=
)ata treatment
)ata processmg 30,000
lata analyzing
lliscellaneous 70,000
rotal 320,700/=
34
REFERENCES
Allan Harrison and Ranko Van Hack (2005) Logistic Management and
Strategy 2nd edition Prentice Hall.
i\.K. Chardhry ( 1999) Encyclopedia of Modem Management Techniques New
Delhi Anmol PVT Ltd.
i\sian Ivan Weele (2002) Purchasing and Supply Chain Management 2nd
edition Veskas Publishing
3AILY Former Jossip Jones (1998) Purchasing Principle and Management
, th edition Vodkas Publishing.
)onnald Waters (2002) Introduction to Supply Chain Management 1st
:dition McMillan press UK.
'ranklin G.M. (1995) Manufacturing Management Home Wood Winois
~ichard D. Win Inc.
~enneth Lyson, Bryan Farrington (2008) Purchasing and Supply Chain
tlanagement 9th edition Prentice Hall.
:enneth Lyson (1996) Purchasing 4th edition Pitman Publishing.
:enneth Lyson and Farrington (2006) Purchasing and Supply Chain
1anagemenl UK Chartered of Purchasing (CIPS-UK).
35
Tan Kealchoon, Rober Handsfiedl and Daniel Kruase (1998) Enhancing Firm
Olive N.M. and Abel G.M. (1999) Research Methods and Quantitative and
Qualitative App mach Nairobi acts Press.
Nuara A.S. (2007) Purchasing and Supplies Management Simplified
Nairobi Print Well Industries Ltd.
=>erformance through Supply base Management an empirical study or
nternational Journal of Production Research
Niter B.E. and Michael R.L. (1975) Purchasing Materials Management
Ninois Richard D. Inn Inc.
36
QUESTIONNAIRE
THE EFFECT OF INVENTORY CONTROL SYSTEM ON PERFORMANCE OF
THE STORES DEPARTMENT
)ear respondents as part of my requirements to the award of a degree in
mpplies and procurement at Kampala international university, I am doing
·esearch on the effect of inventory control systems on performance of the stores
iepartment at Joint Medical Stores in Kampala, Uganda. This information is
·or academic purpose. I promise to keep it confidential which will not be
·evealed to any one except me the researcher and my supervisor.
,ECTION: A RESPONDENT BACK GROUND (TICK WHERE APPROPRIATE)
.1. Gender: Male
.2. Age: 20-29
30-39
40-49
50-59
60-above
.3. Marital status: single
Married
Other
D
D D D D
D D
Female D
.4. Occupation: ......................................................................................... .
. 5. Position: ........................................................................................... ..
37
SECTION B
2. Is there any relationship between inventory management and stores
department?
Yes 0 No 0
3. If yes, what is the relationship between inventory management and
stores department?
············································································································
············································································································
+. Which of the relationship is common in the organization?
).
············································································································ ............................................................................................................
How long does inventory take in store?
Short time O Medium time D Long time 0
,. How many personnel are required in handling inventory?
············································································································
············································································································
How is inventory management in the performance of stores department
measured?
Total Order fill D Accuracy of Requirements 0 Updates of records 0
Which is the best measure of the above?
············································································································
············································································································
38
1. What problems do you face m managmg inventory m joint medical
stores?
I 0. What are the solutions to the inventory control problems?
39
INTERVIEW GUIDE
1. What is the relationship between inventory management and the
performance of stores department?
2. How is inventory management in the performance of stores department
measured?
3. What problems do you face in managing inventory in joint medical
stores?
40
