1. Why are stockroom operations step-up under the current system? What are the o
ID: 376328 • Letter: 1
Question
1. Why are stockroom operations step-up under the current system? What are the objectives?
Lisa Caruso Lisa Caruso, purchasing manage very concerned about the company's stockroom opera Thursday ions. Faulty records, a rash of last-minute rush orders, was occasionally scheduled on and interference with production were troubles that s had become aware of since becoming manager nine r at Morrison, Inc., was including an unpaid 30-minute lunch break) Monday to , and two eight-hour shifts on Friday. Overtime Most loaders were manufactured to customer order with six to eight weeks' lead time. About 60 percent of the months earlier. It was Thursday, November 6, and with loaders and accessories (e.g. .buckets and forks) were sold volumes expecting to increase during the coming months, through distributors in the northeastern United States and Lisa wanted to make a proposal to the president during their meeting the following week Canada. Normally, distributors and customers did some final assembly themselves. MORRISON, INC. MANUFACTURING OPERATIONS Morrison Inc., (Morrison) located near Philadelphia, The major departments in the plant included the machine Pensylvania, manufactured loaders and accessories for shop, fabrication and welding, assembly, and painting. the construction industry. Current sales were approxi The plant also had a maintenance and repair department mately $50 million. The owner-president of Morrison, which included a repair parts storage room David Morrison, was the son of the founder of the busi The company employed 140 nonunion hourly workers s. The company enjoyed an excellent reputation for a and 30 staff across six departments: engineering, manu ell engineered, high-quality, sturdy product line. Morrison facturing, human resources, accounting and finance, ontruction equipment was considered a premium brand sales, and purchasing. Managers in each department re- in the industry, which differentiated itself from the large ported directly to the president, but enjoyed a high degree of autonomy acturers on the basis of quality and reliability. dMorrisn believed in keeping overhead costs and all aspects of the business as simple as possible. prior, purchased from a local software provider. Purchas- ere highly seasonal and cyclical, closely tied to the ing modules in the system included inventory control The company installed an ERP system several years of td nstruction industry. The peak manufactur purchase orders, shipping and receiving, requisitions, and forecasting. planning, and scheduling. The information systems team reported to the CFO period rar d September. During me, the company operated two 10-hour shifts (notExplanation / Answer
The stockroom operation step up under the current system as the reasons are given below:
1. To avoid mismatch on the actual cost and inventory.
2. The inventory count is done on yearly once of audit, so that the show on the inventory records the stockroon operation were under the current system.
3. The emergency requirements can be purchased only after informing to the supervisor, as that avoids on the conflicts among the supervisor and clerk.
4. The profit increases as where there will not be any mismatch in the stocks, a clear expenditures cost can be determined.
The following are the objective:
1. Rush orders can be reduced.
2. Demand on the goods can be increased.
3. Increase profit and reduce expenses.
4. There will not be any missing in the stock as that could be well maintained.
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