Materials Management

Course Objectives

At the end of the course the student will have the ability to:

  • Explain Materials Management definitions and terminology.
  • Understand and apply materials management practices and its relationship to supply chain management.
  • Implement the key activities involved in buying and utilizing materials that contributes and enhances the organization’s performance.

Course Content

Introduction to Materials Management

  • Describe the functions and objectives of materials management.
  • Describe a typical materials organization and its policies and procedures.
  • Recommend policies and procedures for purchasing, inventory, and transportation management.
  • Describe several problems in materials management.

Purchasing Pre-award Processes

  • Describe the basic purchasing process.
  • List and explain the factors to consider when selecting suppliers.
  • Describe the principles and techniques for negotiating with suppliers.

Procurement Methods

  • How to determine appropriate methods of procurement.
  • The process for preparation and solicitation of competitive bids, quotations, and proposals with pertinent specifications, terms, and conditions.
  • When to use informal procurement methods and when to use formal procurement methods.
  • The competitive bidding and negotiation procurement methods.

Contract Types

  • List and describe the criteria used to select an appropriate type of contract.
  • Explain how different contract types fall on a “risk continuum”.
  • Explain the principal characteristics of several fixed price and cost reimbursable contracts.
  • Prepare and/or issue contracts/purchase orders (using the appropriate type of contract).

Price and Cost Analysis

  • Define and explain price analysis and cost analysis.
  • List the members of the pricing team and explain how to manage them in their conduct of price and/or cost analysis.
  • Use price analysis and/or cost analysis to evaluate competitive offerings to determine the overall best offer for a product/service.
  • Explain the relationship between price/cost analysis and negotiation.

Purchasing Post-Award Processes (Contract Administration)

  • Explain the buying organization responsibilities in contract administration and the central purpose of contract administration.
  • Describe the contract administration planning process and explain the importance of such planning.
  • Describe the contract administration team and the respective duties and responsibilities of team members.
  • List and describe the specific responsibilities of the contract administrator, technical representative, and quality assurance representative.
  • Explain the contract close-our process.

Global Purchasing/Sourcing

  • Terms of Purchase Documentation
  • The Terms of Shipping Documentation
  • What the Purchaser Should Specify in the International Purchase Contract
  • International Commercial Terms (INCOTERMS)
  • Bill of Lading and Other International Purchasing Documents
  • Global Payments
  • ustoms Duties and Required Documents

Introduction to Transportation

  • The macroeconomic and microeconomic roles of transportation;
  • The characteristics of various transportation modes;
  • The various methods of ownership.
  • The economics of movement; and
  • The changing environment in which transportation operates

Global Transportation

  • Balancing Act: Security vs. Global Commerce.
  • Global Transportation Providers.
  • Rate Making in Global Transportation.
  • Global Transportation Problems, Issues, & Policies.
  • Role of Port Authorities in Global Transportation.
  • Future of Global Transportation.

Basics of Inventory Management

  • Explain the fundamental purpose of maintaining inventory;
  • Develop an understanding of the benefits and costs of inventory;
  • Examine the tradeoffs present among inventory, customer service and other functional costs in logistics; and
  • Demonstrate awareness of rationing methods and inventory performance measurement.

Inventory Management Costs

  • Explain the major reasons for carrying inventory.
  • Explain the role of inventory to major functional areas in the company.
  • Discuss the major types of inventory-related costs and their relationships to inventory decisions.
  • Understand how inventory items (stock-keeping units) can be designed to maximize the efficiency of managing inventory.
  • Appreciate the importance and value of inventory visibility to increasing supply chain effectiveness.
  • Understand how companies can evaluate the effectiveness of their inventory management techniques.

Inventory Management Systems

  • Understand how demand influences replenishment model selection;
  • Distinguish the strategic, operational and performance differences between PUSH and PULL inventory forecasting systems;
  • Explain how a Collaborative Planning, Forecasting, and Replenishment system can be used to advantage in forecasting inventory requirements.

Warehouse Management

  • Discuss the strategic value-adding role warehousing plays in the logistics system.
  • Explain the basic rationale for warehousing in light of transportation consolidation, product mixing, service, contingency protection, and smoothing.
  • Develop an analytical framework for basic warehousing decisions.
  • Distinguish between the different warehouse activities requiring space in the warehouse design.
  • Discuss the major principles of warehouse layout design.
  • Compare the use of private versus public warehousing.
  • Explain public warehousing services, regulations, and pricing.

ERP and SRM Systems

  • Business process automation
  • CRM, Customer Relationship Management systems
  • ERP, Enterprise Resource Planning systems
  • SRM, Supplier Relationship Management systems

Recommended Text:

Book Title -: Introduction to Materials Management (7th Edition)
Author/s -: J. R. Tony Arnold, Lloyd M. Clive
Publisher -: Pearson Education, Upper Saddle River, NJ, 2011

Book Title -: Essentials of Supply Chain Management, (Third Edition)
Author/s -: Michael H. Hugos
Publisher -: John Wiley and Sons, 2011