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Abstract
The study was determined to examine the relationship between inventory management and organizational performance. The study purpose of the study is to ascertain the extent at which inventory control influences organizational performance of telecommunication firms in Rivers State, to determine the nature of the relationship between demand management and organizational performance of telecommunication firms in Rivers State and to determine the relationship between of Just-in-time and organizational performance of telecommunication firms in Rivers State.The population of the study was made to be one hundred and thirty eight (138). The Yaro Yemen’s formula was used to determine the sample size of one hundred and ten (110). A self-designed questionnaire on inventory management and organizational performance was used and administered for the collection of data from the respondents in Telecommunication firms in Rivers State. Both primary and secondary data were used for the study. The Pearson product moment correlation coefficient was used in testing the validity of the answers. Findings reveal that there is a significant relationship between inventory management and organizational performance of telecommunication firms in Rivers State. Based on the findings of the study summary, conclusion and recommendations were made that to be manage and improved inventory it needs constant goal and level of stock, The method of inventory valuation should be based on the types of items on the stock inflation problems, Telecommunication firms in branch should assign staff for the managing and controlling of it inventory as it will help to wipe off obsolete and enhance quality management as well as making the complex to be profitable and Perfect quality control system should be carried out by assigned staff.
Table of Contents
Title Page i
COVER PAGE ii
Abstract iii
Declaration iv
Certification v
Dedication vi
Table of Contents viii
List of Tables x
List of Figures xi
CHAPTER 1 1
INTRODUCTION 1
1.1 Background of the Study 1
1.2 Statement of Problem 3
1.3 Objectives of the study 3
1.4 Research Questions 4
1.5 Research Hypotheses 4
1.6 Significance of the Study 4
1.7 Scope/Limitations of the Study 5
1.8 Definition of Terms 6
CHAPTER 2 7
LITERATURE REVIEW 7
2.1 Conceptual Framework 7
2.1.1 Concept of Inventory Management 7
2.1.2 Dimensions of Inventory Management 10
2.1.3 Concept of Organizational performance 11
2.1.4Measures of Organizational performance 12
2.1.5 Inventory Management and Organizational performance 12
2.2 Theoretical Framework 14
2.2.1 Queuing theory 14
2.3 Empirical Review 14
CHAPTER 3 19
RESEARCH METHODOLOGY 19
3.1 Research Design 19
3.2 Population of the Study 19
3.3 Sample and Sampling Techniques 20
3.4 Questionnaire Design 21
3.5 Sources and Method of Data Collection 21
3.6 Data Analytical Method 22
3.7 Reliability and Validity 22
CHAPTER 4 24
DATA PRESENTATION AND ANALYSIS 24
4.1 Data Presentation and Analysis 24
4.2 Data Analysis 25
4.3 Test of Hypothesis 30
4.4 Discussion of Findings 32
CHAPTER 5 35
SUMMARY, CONCLUSION AND RECOMMENDATIONS 35
5.1 Summary 35
5.2 Conclusions 36
5.3 Recommendations 36
References 38
Appendix I 40
Appendix II 41
List of Tables
Table 4.1 Administered and Retrieved Questionnaire 24
Table 4.2: Inventory control affects organizational performance of telecommunication firms in Rivers State. 25
Table 4.3:Techniques of inventory management use in Telecommunication firms in Rivers State. 25
Table 4.4: problems associated with inventory management in Telecommunication firms in Rivers State branch on inventory management. 26
Table 4.5: If demand management affects organizational performance of telecommunication firms in Rivers State. 27
Table 4.6: Inventory management influences organizational performance of telecommunication firms in Rivers State. 27
Table 4.7:Just-in-time affects organizational performance of telecommunication firms in Rivers State. 28
Table 4.8:Inventory management improve organizational performance of telecommunication firms in Rivers State. 29
Table 4.9: Inventory management associate with organizational performance of telecommunication firms in Rivers State 29
Table 4.10: Computation of Pearson Products Analysis 30
List of Figures
Fig. 2.1: A Conceptual Framework Showing The Relationship Between Inventory Management And Organizational performance 7
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
Performance is a comparison between the work of the real compared to the standard set by the company (Dessler, 2000). Performance is the quantity and quality of produced or services rendered by a person in doing the job (Luthan, 2005). Performance is the work of behavior (Armstrong, 1999). Performance is the relationship between work and behavior.Organizational performance is derived from the word job performance that means real work produced an employee within a specific time period.
Organizational performance is the working result of the employee within a certain time. Performance is the degree to which the employee reaches the job requirements (Simamora, 1995). Performance is the achievement record resulting from the acquisition of a particular job function or activity during a specific time period (Luthan, 2005).
Organizational performance measurement include: quality (fineness, cleanliness, accuracy), the speed of time, the number and kinds of jobs, skills in using tools, and knowledge of the work. Luthan, (2005).
One of the ways an organization can experience organizational performance is through inventory management. Inventory management is a critical management issue for most companies large companies, medium-sized companies, and small companies. Effective inventory flow management in supply chains is one of the key factors for success. The challenge in managing inventory is to balance the supply of inventory with demand. A company would ideally want to have enough inventories to satisfy the demands of its customers- no lost sales due to inventory stock-outs. On the other hand, the company does not want to have too much inventory staying on hand because of the cost of carrying inventory. Enough but not too much is the ultimate objective (Coyle, Bardi, and Langley, 2003). The role of inventory management is to ensure faster inventory turnover. Inventory management is necessary at different locations within an organization or within multiple locations of a supply chain, to protect (the production) from running out of materials or goods. Adequate inventories kept in manufacturing companies will smooth the production process. The wholesalers and retailers can offer good customer services and gain good public image by holding sufficient inventories. The basic objective of inventory management is to achieve a balance between the low inventory and high return on investment (ROT). Inventory levels have been seen as one of the most interesting areas for improvement in organization materials management (Kumar Ordamar, Zhang, 2008).
Inventory plays a significant role in the growth and survival of an organization in the sense that ineffective and inefficient management of inventory will mean that the organization loses customers and sales will decline. Prudent management of inventory reduces depreciation, pilferage, and wastages while ensuring availability of the materials as at when required (Ogbadu, 2009). Inventory management is critical to an organization’s success in today’s competitive and dynamic market. This entails a reduction in the cost of holding stocks by maintaining just enough inventories, in the right place and the right time and cost to make the right amount of needed products. High levels of inventory held in stock affect adversely the procurement performance out of the capital being held which affects cash flow leading to reduced efficiency, effectiveness and distorted functionality ( Koin, Cheruiyot , and Mwangangi , 2014). From the foregoing therefore, the study is determined to examine the relationship between inventory management and organizational performance of telecommunication firms in Rivers State.
1.2 Statement of Problem
Inventory is a vital part of current assets mainly in manufacturing concerns. Huge funds are committed to inventories as to ensure smooth flow of production and to meet consumer demand.
However, maintaining inventory also involves holding or carrying costs along with opportunity cost. Inventory management, therefore, plays a crucial role in balancing the benefits and disadvantages associated with holding inventory. Efficient and effective inventory management goes a long way in successful running and survival of a business firm, when organizations fail to manage their inventory effectively they are bound to experience, stock out, the decline in productivity and profitability, customer dissatisfaction. Thus the study seeks to investigate the effect of inventory management on the organizational performance of the selected telecommunication firms in Rivers State.
1.3 Objectives of the study
The main objective of the study is to examine the relationship between inventory management and organizational performance of telecommunication firms in Rivers State. The specific objectives were;
1. To ascertain the extent at which inventory control influences organizational performance of telecommunication firms in Rivers State.
2. To determine the nature of the relationship between demand management and organizational performance of telecommunication firms in Rivers State.
3. To determine the relationship between of Just-in-time and organizational performance of telecommunication firms in Rivers State.
1.4 Research Questions
With the above objectives in focus, the study seeks to find answers to the following questions:
1. To what extent does inventory control influences organizational performance of telecommunication firms in Rivers State?
2. To what extent does demand management affects organizational performance of telecommunication firms in Rivers State?
3. To what extent does Just-in-time affects organizational performance of telecommunication firms in Rivers State?
1.5 Research Hypotheses
These hypotheses were proposed for the study:
HO: There is no significant relationship between inventory management and organizational performance of telecommunication firms in Rivers State.
HA: There is a significant relationship between inventory management and organizational performance of telecommunication firms in Rivers State.
1.6 Significance of the Study
The study findings may be significant in the following ways; it is hoped that study findings may be used as basis for further research and investigations in form of literature.
The findings may provide information to managers in different organizations especially on knowing how to compare actual organizational performance and inventory management.
The findings may also be beneficial to other upcoming researchers to investigate further about the impact of inventory management on organizational performance of other organizations other than telecommunication firms in Rivers State.
The study may further encourage government to set up educational institutions to provide training on how to manage inventory in organizations.
1.7 Scope/Limitations of the Study
The scope of this study is delimited into the followings:
Content Scope: The specific areas of organizational Performance the study investigated include; efficiency, effectiveness and market share. Whereas, the areas of inventory management includes inventory control, demand management and just-in-time.
Geographical scope: This study covers an examination of strategic contributions of inventory management and organizational performance of telecommunication firms in Rivers Statewhich include MTN, Clobacom Airtel and 9Mobile.
Unit of Analysis: This is a macro study because it is interested in ascertaining the performance of an organization in this direction. Hence, it is a micro level study.
The major limitation of the study is the short time frame the research lasted, coupled with the tight academic time table, which prevented a very comprehensive study. The fund available to the researcher was also limited and therefore the study was limited to a small portion of the survey population.
Another limitation is the difficulties, encountered by the researcher in obtaining all needed information and materials from the right source and computation of data for the project.
1.8 Definition of Terms
Inventory: Is the amount of goods, materials or part carried out in stock or store house for example, work in progress (W.I.P), raw materials, financial goods resale more items.
Organization: An organized body of people with a particular purpose, especially a business, society, association, etc.
Inventory management: Inventory management is a science primarily about specifying the shape and placement of stocked goods. It is required at different locations within a facility or within many locations of a supply networks to precede the regular and planned course of production and stock of raw materials.