Information and Knowledge Management ISSN 2224-5758 (Paper) ISSN 2224-8 !" (#nline) $ol.%& No.

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Effect of Inventory Management on Organisational Effectiveness

)ni*+e,e Nnaeme-a ).g.stine(/0me-ani*+e,e 12a+oo.*om. Management& 3ni4ersit2 of Nigeria& 0n.g. 5amp.s )g.& #-oro )g. 2 /6on7o-o8om,o12a+oo.*om Management& 3ni4ersit2 of Nigeria& 0n.g. 5amp.s Abstract 9+e st.d2 of t+e :0ffe*ts of In4entor2 Management on #rgani;ational 0ffe*ti4eness in sele*ted organi;ations in 0n.g.& was *arried o.t& to asses t+e impa*t of proper in4entor2 management on organi;ational performan*es in 0menite& <ardis = 6romedas and t+e Nigeria >ottling 5ompan2 all in 0n.g.& 0n.g. State. 6es*ripti4e resear*+ met+od& espe*iall2 s.r4e2 and *ase st.d2 were emplo2ed in *arr2ing o.t t+e st.d2. 9+e pop.lation of t+e st.d2 is si? +.ndred and fift2 eig+t (!58). ) sample si;e of two +.ndred and fo.t+2 eig+t (248)& was deri4ed .sing t+e 9aro @amene form.la for sample si;e determination from a finite pop.lation. 6ata were generated .sing A.estionnaire& oral inter4iews& o,ser4ations& ,oo-s& 8o.rnals and t+e internet. 6ata were presented in ta,les and anal2;ed .sing simple per*entages. Pearson prod.*t moment *orrelation *oeffi*ient and linear regression was .sed in t+e +2pot+eses testing. Brom t+e anal2ses& it was dis*o4ered t+at irrespe*ti4e of t+e fa*t t+at t+e organi;ations st.died& painted t+e pi*t.re t+at t+e2 were appl2ing t+e tenets of good in4entor2 management& t+e2 from time to time r.n into t+e pro,lems of in4entor2 inadeA.a*2. 9+is *onseA.entl2 affe*ted t+eir prod.*tion& leading to t+e s*ar*it2 of one ,rand of t+eir prod.*ts or t+e ot+er& t+ere,2 affe*ting t+eir profita,ilit2 and *onseA.ential effe*ti4eness negati4el2. 9+e Bindings indi*ate t+at t+ere is signifi*ant relations+ip ,etween good in4entor2 management and organi;ational effe*ti4eness. In4entor2 management +as a signifi*ant effe*t on organi;ational prod.*ti4it2. 9+ere is +ig+l2 positi4e *orrelation ,etween good in4entor2 management and organi;ational profita,ilit2. 9+e st.d2 *on*l.ded t+at In4entor2 Management is 4er2 4ital to t+e s.**ess and growt+ of organi;ations. 9+e entire profita,ilit2 of an organi;ation is tied to t+e 4ol.me of prod.*ts sold w+i*+ +as a dire*t relations+ip wit+ t+e A.alit2 of t+e prod.*t )gainst t+is ,a*-gro.nd t+e st.d2 re*ommended t+at #rgani;ations s+o.ld di4ersif2 t+eir in4entor2 s2stem to s.it spe*ifi* needs of prod.*tion& and t+at management s+o.ld *losel2 monitor and manip.late t+eir in4entor2 s2stem to maintain prod.*tion *onsisten*2 for organi;ational profita,ilit2 and effe*ti4eness. Keywords:In4entor2 management& #rganisational effe*ti4eness& Birms Introduction In4entories are 4ital to t+e s.**essf.l f.n*tioning of man.fa*t.ring and retailing organi;ations. 9+e2 ma2 *onsist of raw materials& wor--in-progress& spare partsC*ons.ma,les& and finis+ed goods. It is not ne*essar2 t+at an organi;ation +as all t+ese in4entor2 *lasses. >.t& w+ate4er ma2 ,e t+e in4entor2 items& t+e2 need effi*ient management as& generall2& a s.,stantial s+are of its f.nds is in4ested in t+em. 6ifferent departments wit+in t+e same organi;ation adopt different attit.de towards in4entor2. 9+is is mainl2 ,e*a.se t+e parti*.lar f.n*tions performed ,2 a department infl.en*e t+e departmentDs moti4ation. Bor e?ample& t+e sales department mig+t desire large sto*- in reser4e to meet 4irt.all2 e4er2 demand t+at *omes. 9+e prod.*tion department similarl2 wo.ld as- for sto*-s of materials so t+at t+e prod.*tion s2stem r.ns .ninterr.pted. #n t+e ot+er +and& t+e finan*e department wo.ld alwa2s arg.e for a minim.m in4estment in sto*-s so t+at t+e f.nds *o.ld ,e .sed elsew+ere for ot+er ,etter p.rposes& ($o+ra& 2''8/427). In4entor2 represents an important de*ision 4aria,le at all stages of prod.*t man.fa*t.ring& distri,.tion and sales& in addition to ,eing a ma8or portion of total *.rrent assets of man2 organi;ations. In4entor2 often represents as m.*+ as 4'E of total *apital of ind.strial organi;ations (Moore& Fee and 9a2lor& 2''%/%2(). It man2 represent %%E of *ompan2 assets and as m.*+ as 'E of wor-ing *apital& (Sawa2a Gr. and Hia.A.e& 2''!/(2(). Sin*e in4entor2 *onstit.tes a ma8or segment of total in4estment& it is *r.*ial t+at good in4entor2 management ,e pra*ti*ed to ens.re organi;ational growt+ and profita,ilit2. )**ording to 9emeng et al (2'('/( 5)& +istori*all2& +owe4er organi;ations +a4e ignored t+e potential sa4ings from proper in4entor2 management& treating in4entor2 as a ne*essar2 e4il and not as an asset reA.iring management. )s a res.lt& man2 in4entor2 s2stems are ,ased on ar,itrar2 r.les. 3nfort.natel2& it is not .n.s.al for some organi;ations to +a4e more f.nds in4ested in in4entor2 t+an ne*essar2 and still not ,e a,le to meet *.stomer demands ,e*a.se of poor distri,.tion of in4estment among in4entor2 items (9emeng& 0s+.n and 0sse2& 2'('/( ). >ased on t+e a,o4e analog2& t+erefore t+is paper e4al.ates t+e in4entor2 management and organi;ational effe*ti4eness in man.fa*t.ring organi;ations in 0n.g. State& wit+ respe*t to/ 0menite and <ardis and 6romedas ,ot+ at 0mene 0n.g. as well as t+e Nigeria >ottling 5ompan2 at t+ Mile *on*ern also in 0n.g..

Information and Knowledge Management ISSN 2224-5758 (Paper) ISSN 2224-8 !" (#nline) $ol.%& No.8& 2'(%

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Statement 0f the Problem Pro,lems of in4entor2 management and *ontrol +a4e ,een aro.nd for a 4er2 long time. 9+e need to *olle*t food w+en it is readil2 a4aila,le and t+en store it for times of s+ortage is per+aps t+e f.ndamental sto*- +olding pro,lem& w+i*+ was ta*-led long ago ,2 man. Nowada2s& we .s.all2 t+in- of sto*-s ,eing +eld ,2 organi;ations to allow effi*ient and *ontin.o.s operations. Managers are aware of t+e 4ital roles in4entor2 pla2s in t+e a*ti4ities of organi;ations. In most organi;ations& dire*t materials represent .p to 5'E of t+e total prod.*t *ost& as a res.lt of t+e mone2 entr.sted on in4entor2& t+ere,2 affe*ting t+e profita,ilit2 of t+e organi;ation. #rgani;ations at times do not *ontrol t+eir in4entor2 +olding& res.lting in .nder sto*-ing and *a.sing t+e organi;ations to sta2 off prod.*tion& t+ere,2 res.lting to organi;ational ineffe*ti4eness. 9+is t+erefore *reates relations+ip pro,lems ,etween in4entor2 management and organi;ational prod.*ti4it2& profita,ilit2 and effe*ti4eness& Ob ectives of the Study 9+e ,road o,8e*ti4e of t+is st.d2 is to e4al.ate t+e effe*ts of in4entor2 management on t+e effe*ti4eness of man.fa*t.ring organi;ations in Nigeria& w+ile t+e spe*ifi* o,8e*ti4es are/(. 9o e?amine t+e nat.re of relations+ip ,etween in4entor2 management and organi;ational effe*ti4eness. 2. 9o determine t+e effe*t of in4entor2 management on organi;ational prod.*ti4it2. %. 9o e4al.ate t+e nat.re of *orrelation ,etween in4entor2 management and organi;ational profita,ilit2. !esearch "uestions 9+e following A.estions will g.ide t+e st.d2I (. J+at is t+e nat.re of relations+ip ,etween in4entor2 management and organi;ational effe*ti4enessK 2. J+at is t+e effe*t of in4entor2 management on organi;ational prod.*ti4it2K %. 9o w+at e?tent does in4entor2 management *orrelate wit+ organi;ational profita,ilit2K !esearch #y$otheses 9+e following resear*+ +2pot+eses were form.lated for t+e st.d2I < (/ 9+ere is signifi*ant relations+ip ,etween in4entor2 management and organi;ational effe*ti4eness. < 2/ 9+ere is signifi*ant positi4e effe*t in4entor2 management on organi;ational prod.*ti4it2 < %/ 9+ere is positi4e *orrelation ,etween in4entor2 management and organi;ational profita,ilit2 !eview of !elated %iterature In4entor2 is t+e sto*- of an2 item or reso.r*e .sed in an organi;ation. )n in4entor2 s2stem is t+e set of poli*ies and *ontrols t+at monitors le4els of in4entor2 and determines w+at le4els s+o.ld ,e maintained& w+en sto*s+o.ld ,e replenis+ed& and +ow large orders s+o.ld ,e& (5+ase and )A.ilano& ( 5/54!). #n t+e ot+er +and& management is an a*t of organi;ational design. 9+e ,asi* f.n*tions of management is to identif2 for a fo*al ,.siness organi;ation areas of *r.*ial *ontingen*ies and *onstraints so t+at t+e ,.siness organi;ation *an ma-e str.*t.ral responses to in*l.de t+ese *onstraints and *ontingen*ies wit+in its ,o.ndar2. (#nw.*+e-wa& ( %/( %). In4entor2 management t+erefore +as ,een defined in man2 wa2s ,2 man2 a.t+ors. )s e?pe*ted& t+ese a.t+ors defined in4entor2 management ,ased on t+eir per*eption of t+e s.,8e*t matter. Nwand.& (2''!/(7() defines in4entor2 management as a form of administration *ontrol t+at is parti*.larl2 essential in all man.fa*t.ring& w+olesale and retail organi;ations. 9+e essen*e of in4entor2 a**ording to Nwand. is& :to +a4e t+e rig+t goods A.alit2 and A.antit2& at t+e rig+t pla*e and timeL. 9+e essen*e of in4entor2 management for a *ontemporar2 organi;ation. 9+is pro*ess is needed as a part of s.ppl2 *+ain networ- to prote*t prod.*tion s2stem against an2 -ind of dist.r,an*e. #rga (2''!/!!)& defines in4entor2 *ontrol as a pro*ess of ens.ring t+at t+e rig+t A.alit2 of t+e rele4ant sto*- is a4aila,le at t+e rig+t time and in t+e rig+t pla*e. Nwe;e (2''4/42%)& on +is own part defines in4entor2 *ontrol as t+e means of ens.ring t+at a*t.al flow of in4entor2 in an organi;ation *onforms wit+ plan. Brom t+e foregoing t+erefore& one infers t+at in4entor2 management is t+e a*t of ens.ring t+at ,alan*ed items of sto*- are maintained at t+e rig+t A.antit2& A.alit2& pla*e and time in an organi;ation& to ens.re organi;ational ,.siness *ontin..m. &y$es of Inventory Ile (2''2/%7()& opines t+at in4entor2 is *lassified into t+ree t2pes w+i*+ in*l.deI i. Maw Material in4entor2 ii. Jor--in-progress in4entor2 iii. Binis+ed goods in4entor2

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Maw material in4entor2/ 9+is in*l.des all items p.r*+ased ,2 an organi;ation for pro*essing. Bor instan*e& Blo.r& 2east& eggs et*. are all part of raw materials in4entor2 of a *onfe*tionar2 organi;ation. Jor--In-Progress In4entor2 9+is is also *alled goods-in-progress in4entor2. 9+is is an intermediate stage of raw material in4entor2 t+at is 2et to ,e finis+ed ,2 t+e plant to enter into anot+er stage of pro*essing. 9+ese are materials t+at +a4e ,een partl2 pro*essed ,.t are 2et .n*ompleted. Binis+ed Hoods In4entor2 9+is is t+e sto*- of finis+ed goods. 9+ese *o.ld ,e sto*- of goods awaiting s+ipment or in t+e ware+o.se& t+e le4el of finis+ed goods sto*- is a matter of *o-ordination ,etween t+e prod.*tion and sales departments of t+e organi;ation. Pur$oses for #olding Inventory )**ording to >an8o-o (2''4/( 2)& man.fa*t.ring organi;ations *arr2 in4entories for a 4ariet2 of reasons. In4entories perform signifi*ant f.n*tions in t+e total prod.*tion s2stem and sin*e :it is p+2si*all2 impossi,le and e*onomi*all2 impra*ti*a,le for ea*+ sto*- of item to arri4e e?a*tl2 w+ere and w+en it is neededL& t+ere is need to -eep some amo.nt of in4entor2 at an2 point in time. >an8o-o o.tlined se4en reasons for +olding in4entories& w+i*+ in*l.deI (. 9o en+an*e .ninterr.pted flow of prod.*tion 2. 9o meet 4ariations in prod.*t demand. %. 9o allow fle?i,ilit2 in prod.*tion s*+ed.ling 4. 9o de*o.ple s.**essi4e stages of operations 5. 9o le4el prod.*tion a*ti4ities !. 9o pro4ide a means of +edging against f.t.re pri*es and deli4er2 .n*ertainties 7. 9o pro4ide a means of o,taining e*onomi* lot si;e and gaining A.antit2 dis*o.nts. #n t+eir own part& 5+ase and )A.ilano (( 5/547) en.merated fi4e reasons for +olding in4entories. 9+e2 are& (. 9o maintain independen*e of operations 2. 9o meet 4ariations in prod.*t demand %. 9o allow fle?i,ilit2 in prod.*tion s*+ed.ling 4. 9o pro4ide a safeg.ard for 4ariation in raw material deli4er2 time 5. 9o ta-e ad4antage of e*onomi* p.r*+ase order si;e. Brom t+e foregoing& one o,ser4es t+at t+e a.t+ors are sa2ing 4irt.all2 t+e same t+ing& despite t+e fa*t t+at >an8o-o *onsidered se4en reasons against fi4e proffered ,2 5+ase and )A.ilano. Je t+erefore s.,s*ri,e to t+eir 4iews for +olding in4entories& and *on*l.de t+at t+e reasons for +olding in4entories are to minimi;e *ost and *onseA.entl2& ma?imi;e profit in an organi;ation. Inventory System 9+e *ardinal o,8e*ti4e of in4entor2 management is t+e maintenan*e of an optim.m le4el of in4entor2 ne*essar2 to s.pport t+e prod.*tion s2stem at an2 time and at t+e least *ost possi,le. 9+e attainment of t+is o,8e*ti4e entails ta-ing de*isions wit+ respe*t to t+e determination of an appropriate order A.antit2& w+en to pla*e t+e order and +ow m.*+ in4entor2 to *arr2 per .nit of time. 9+ese 4ario.s de*ision 4aria,les will& at an2 time& di*tate t+e ,e+a4io.r of an2 in4entor2 s2stem. In4entor2 ordering s2stems refle*t part of t+e strategies a4aila,le to an organi;ation in meeting its in4entor2 management o,8e*ti4es. >asi*all2& t+ere are t+ree ma8or in4entor2 ordering s2stems& t+e fi?ed N order A.antit2 s2stem& t+e fi?ed-order inter4al s2stem and t+e )>5 in4entor2 anal2sis s2stem. 9+e Bi?ed-#rder O.antit2 S2stem In t+e fi?ed-order si;e s2stem& orders for a fi?ed A.antit2 of items are pla*ed for ea*+ in4entor2 *2*le. 9+e time of ordering ma2 4ar2 ,.t t+e A.antit2 ordered per period is alwa2s t+e same. 9+is s2stem is sometimes referred to as t+e (O&M) s2stem. J+en in4entor2 le4el gets as low as point M (reorder point)& an order is pla*ed for O .nits of in4entor2. 9+e Bi?ed-#rder Inter4al S2stem 9+e fi?ed-order inter4al s2stem e?amines t+e stat.s of in4entor2 le4el at spe*ifi* periods and tries to ,ring t+e in4entor2 le4el to a desired point& if t+e in4entor2 le4el +as gone ,elow t+e minim.m reA.ired point in-,etween t+e time of t+e periodi* re4iews. 9+e )>5 In4entor2 )nal2sis 0ffe*ti4e *ontrol of in4entories *an ,e *ostl2& time and effort *ons.ming. 0?perien*e +as s+own& +owe4er& t+at not all items -ept in in4entor2 reA.ire s.*+ meti*.lo.s and *lose-st.d2 monitoring parti*.larl2 if s.*+ items are low-4al.e items t+at are randoml2 .sed in t+e prod.*tion s2stem. 9+ere are some items& +owe4er& w+ose

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A.antities are small ,.t w+ose monetar2 4al.es are e?or,itant. 9+ese are .s.all2 t+e +ig+ *lass items w+ose 4al.es r.n into t+o.sands of Naira per .nit. 9+e2 normall2 a**o.nt for ,etween ('-2' per *ent of total items -ept in in4entor2& w+ile t+e2 a**o.nt for as +ig+ as ,etween 7'-8' per *ent of t+e total monetar2 4al.e of in4estment in in4entor2. 9+ese are t+e so *alled :signifi*ant fewL in4entor2 items .s.all2 designated as ,elonging to t+e ) gro.p. 9+ere are also t+ose items t+at a**o.nt for ,etween %'-4' per *ent of t+e total items of in4entor2 and at t+e same time& ta-e as m.*+ as (5-2' per *ent of t+e monetar2 4al.e of total in4estment in in4entor2. 9+is gro.p of items are *lassified into gro.p > for p.rposes of effe*ti4e management. 9+e last *lass of in4entor2 items fall into gro.p 5. 9+ese are t+e items t+at are .s.all2 greater in n.m,er ,.t a**o.nt for t+e smallest 4al.e of t+e total monetar2 in4estment in in4entor2. 9+is gro.p of in4entor2 items is referred to as t+e :insignifi*ant man2L. 9+e p.rpose of t+e )>5 in4entor2 *lassifi*ation is to ,e a,le to assess t+e stat.s of e4er2 item -ept in in4entor2 in addition to determining w+at spe*ifi* attention is reA.ired ,2 ea*+ gro.p of in4entor2 (>an8o-o& 2''4/( 8). Brom t+e st.d2& it was dis*o4ered t+at& 0menite and <ardis and 6romedas operate t+e fi?ed-order A.antit2 of in4entor2 s2stem. 9+is was e4ident in t+eir prod.*tion pattern of 4ario.s ,rands of prod.*ts. 9+eir reA.irements for indi4id.al items of in4entor2 +ad ,een determined and t+is led to *ontin.o.s prod.*tion of 4aried prod.*ts& res.lting in t+eir *onsisten*2 in prod.*ts a4aila,ilit2. #n t+e ot+er +and& t+e Nigeria >ottling 5ompan2 operates t+e fi?edNorder inter4al in4entor2 s2stem. 9+is was e4ident in t+eir prod.*tion pattern w+i*+ res.lts into t+e .na4aila,ilit2 of one ,rand of t+eir prod.*ts and s.rpl.s of anot+er at one time or t+e ot+er. #n t+is& we infer t+at organi;ations s+o.ld ,e *ons*io.s of t+eir prod.*tion pattern w+i*+ is a f.n*tion of t+eir prod.*t demand and tr2 to tailor t+eir in4entor2 s2stem toward t+at. Inventory 'ontrol 9+ro.g+o.t t+e in4entor2 *+ain from raw material t+ro.g+ to retail sto*-s& in4entories are planned and *ontrolled item ,2 item. Bor ea*+ item in e4er2 in4entor2& two A.estions m.st ,e answered again and again/ (. <ow man2 of t+is item s+o.ld ,e orderedK 2. J+en s+o.ld it ,e orderedK 9+e *lassi* approa*+ to In4entor2 5ontrol is t+e widel2 -nown :e*onomi* order A.antit2L (0#O) model also -nown as t+e e*onomi* lot si;e (F0S) model (Plossl& 2''5/!4). )lt+o.g+ offered as a general model for all in4entories& in fa*t t+e model is A.ite limited in its appropriate ,est to a s.,set of man.fa*t.ring in4entor2 items& w+ere t+e item .nder *onsideration +as no relations+ip to ot+er parts& e?perien*es& demand w+i*+ *an ,e statisti*all2 fore*asted and w+i*+ reA.ires t+e .se of prod.*ti4e *apa*it2 in order to Pset .pD prepare to wor- on t+e item. 9+e 0#O model is ,ased on *ertain ass.mptions w+i*+ in*l.deI (. Known and *onstant demand& 2. Instantaneo.s replenis+ment& %. >a*-order is not allowed 4. No *onstraints on order si;e 5. 5ost of order is *onstant !. 3nit pri*e is *onstant& (>an8o-o& 2''4/( 8). )**ording to Ile (2''2/%72)& t+e met+ods t+at are .sed for t+e *ontrol of in4entories in*l.de a. Perpet.al in4entor2 met+od& ,. P+2si*al in4entor2 met+od& *. Materials-*ontrol *2*le met+od. Perpet.al In4entor2 Met+od 9+is is also *alled ,alan*e of stores re*ord. 9+e ,alan*e of stores re*ord pla2s t+e *entral role in t+e in4entor2 *ontrol s2stem& parti*.larl2 in a 8o,-order-plant. It *ontrols t+e mo4ement of ea*+ item of in4entor2 as it goes in and o.t of sto*- and s+ows t+e *.rrent ,alan*e at +and. P+2si*al In4entor2 Met+od Some dis*repan*ies ,etween in4entor2 re*ords and A.antities at +and *annot ,e r.led o.t. )n a*t.al *o.nt of all items at +and is periodi*all2 ne*essar2 for effe*ti4e in4entor2 *ontrol. 9+e met+od sele*ted depends .pon t+e si;e and di4ersit2 of sto*-& t+e degree to w+i*+ wor- pro*ess is standardi;ed and t+e pro*essing met+ods emplo2ed in a parti*.lar plant. Material 'ontrol 'ycle Method )n effi*ient s2stem m.st ,e designed for t+e *ontrol of material from t+e time of reA.isitioning of p.r*+ase to t+e storage of t+e finis+ed prod.*t. ) step ,2 step standard ro.tine m.st ,e de4eloped& a.t+orit2 and responsi,ilit2 for t+e e?e*.tion of ea*+ step& m.st ,e *learl2 delegated to spe*ifi* indi4id.als.

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Brom t+e a,o4e& one *an o,ser4e t+at t+e t+ree met+ods of in4entor2 *ontrol are interwo4en. 9+is is from t+e point of 4iew t+at p+2si*al in4entor2 items *an not ,e determined wit+o.t t+e material *ontrol *2*le met+od w+i*+ monitors t+e step-,2-step mo4ement of in4entor2 from entr2 point to e?it point and t+e material *ontrol *2*le *annot ,e effe*ti4e wit+o.t t+e appli*ation of t+e perpet.al in4entor2 met+od. 9+erefore t+e t+ree met+ods of in4entor2 *ontrol are *omplementar2. @o.ng (2''2/(') admits t+at an alternati4e approa*+ to in4entor2 *ontrol (for man.fa*t.ring in4entories in parti*.lar) is to *onsider in4entor2 as a resid.al and not *ontrol it dire*tl2. 9+is is t+e *entral t+eme of 8.st-intime (GI9) s2stem& in w+i*+ attentions is fo*.sed on t+e eliminations of waste& t+e red.*tion of 4aria,ilit2& *lose lin-age among all s2stems& and pro*ess standardi;ation and rationali;ation (#+no& 2''8/2() .9+ese s2stems are ,ased on t+e fa*t t+at m2riad de*isions a,o.t man.fa*t.ring are often made wit+ referen*e to t+e res.lting impa*t on in4entor2 positions. 0?pli*it *onsideration of iss.es t+at *an res.lt in in4entor2 growt+ or depletion *an eliminate t+e *a.ses of s.*+ growt+ or depletion and pre4ent t+em. Method and Materials 9+e st.d2 was *arried o.t primaril2 t+ro.g+ t+e s.r4e2 met+od and inter4iew of emplo2ees in t+ree man.fa*t.ring firms in 0n.g. state Nigeria w+i*+ in*l.de 0menite& <ardis and N>5. Se*ondar2 data were o,tained t+ro.g+ ,oo-s& 8o.rnals& and internet. ) sample si;e of 248 was o,tained from t+e pop.lation of !58 at 5E error toleran*e and 5E degree of freedom .sing 2amaneDs statisti*al form.lar. 2'8(84E) of t+e A.estionnaire distri,.ted were ret.rned w+ile 4' ((!E) of t+e A.estionnaire distri,.ted were not ret.rned. 9+e A.estionnaire was designed in li-ert s*ale format. 9+e resear*+er *ond.*ted a pre-test on t+e A.estionnaire to ens.re t+e 4alidit2 of t+e instr.ment. 6ata *olle*ted were presented in freA.en*2 ta,les. (ata Analysis and (iscussion 9+e data o,tained from t+e field were presented and anal2;ed wit+ des*ripti4e statisti*s to pro4ide answers for t+e resear*+ A.estions w+ile t+e *orresponding +2pot+eses were tested wit+ PearsonDs 5orrelation and Finear regression at '.'5 alp+a le4el. )hat is the nature of relationshi$ between inventory management and organisational effectiveness &able *: 'oded !es$onses on inventory management and organi+ational effectiveness , s-no "uestionnaire items S,Agree (isagree .ndecided -Agree -S,(isagree /re0 1 /re0 1 /re0 1 &otal 2/reg3 ( In4entor2 management in*rease s+are mar-et of a *ompan2K 5 6 *0 7 805 *40 4* 2 <ig+ ret.rn on in4estment *an ,e a*+ie4ed t+ro.g+ effe*ti4e in4entor2 : * 6 8 805 80* 49 managementK 9#9)F :4* ** *6 6*; Source: fieldwor< 80*8 )**ording to ta,le (() ,ased on aggregate response 8'!(88E) indi*ated strongl2 agree& 74(8) indi*ated disagree w+ile %2 (4E) indi*ated .nde*ided. 9+is implies t+at t+ere is a relations+ip ,etween 8o, satisfa*tion and organi;ational *ommitment among se*ondar2 s*+ool tea*+ers in 0n.g. State. #i *: there is a significant relationshi$ between inventory management and organisational effectiveness &able 8 (escri$tive Statistics between inventory management and organisational effectiveness Mean Std. 6e4iation in4entor2 management (.8!54 (.((258 organisational effe*ti4eness 2.2452 (.%( !7

N 2'8 2'8

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&able : 'orrelations between inventory management and organisational effectiveness in4entor2 management in4entor2 management Pearson 5orrelation ( Sig. (2-tailed) N 2'8 organisational effe*ti4eness Pearson 5orrelation .8 8(QQ) Sig. (2-tailed) .''' N 2'8 QQ 5orrelation is signifi*ant at t+e '.'( le4el (2-tailed).

organisational effe*ti4eness .8 8(QQ) .''' 2'8 ( 2'8

9a,le 2 s+ows t+e des*ripti4e statisti*s of t+e in4entor2 management 4ia organisational effe*ti4eness& wit+ a mean response of (.8!54 and std. de4iation of (.((258 for in4entor2 management and a mean response of 2.2452 and std. de4iation of (.%( !7 for organisational effe*ti4eness and n.m,er of respondents (2'8). >2 *aref.l o,ser4ation of standard de4iation 4al.es& t+ere is no m.*+ differen*e in terms of t+e standard de4iation s*ores. 9+is implies t+at t+ere is a,o.t t+e same 4aria,ilit2 of data points ,etween t+e dependent and independent 4aria,les. 9a,le % is t+e Pearson *orrelation *oeffi*ient for in4entor2 management and #rganisational effe*ti4eness. 9+e *orrelation *oeffi*ient s+ows '.8 8. 9+is 4al.e indi*ates t+at *orrelation is signifi*ant at '.'5 le4el (2tailed) and implies t+at t+ere is a positi4e relations+ip ,etween in4entor2 management and organisational effe*ti4eness (r R .8 8). 9+e *omp.ted *orrelations *oeffi*ient is greater t+an t+e ta,le 4al.e of r R .( 5 wit+ 2'! degrees of freedom (df. R n-2) at alp+a le4el for a two-tailed test (r R .8 8& pS .'5). <owe4er& sin*e t+e *omp.ted r R .8 8& is greater t+an t+e ta,le 4al.e of .( 5 we re8e*t t+e n.ll +2pot+esis and *on*l.de t+at t+ere is a positi4e relations+ip ,etween in4entor2 management and organisational effe*ti4eness (r R.8 8& PS.'5). )hat is the nature of the effect between inventory management and $roductivity &able 6: 'oded !es$onses on inventory management and $roductivity s-no "uestionnaire items S,Agree (isagree .ndecided -Agree -S,(isagree /re0 1 /re0 1 /re0 1 ( In4entor2 management en+an*es organisational *ompetiti4e position in t+e ind.str2 6e4elopment of prod.*ts and ser4i*es wit+ +ig+ profit margin is as a res.lt good in4entor2 managementK 9#9)F

&otal 2/reg3 805

*46

4:

*0

806 :45

45

8 *8

8 ;

805 6*;

Source: fieldwor< 80*8 )**ording to ta,le (4) ,ased on aggregate response % 8( !E) indi*ated strongl2 agree& (2(%E) indi*ated disagree w+ile ! ((E) indi*ated .nde*ided. 9+is implies t+at t+ere is a signifi*ant positi4e effe*t in4entor2 management on organisational prod.*ti4it2. #i: inventory management has a $ositive effect on organisational $roductivity &able 7 SPSS result of the effect of inventory management on organisational $roductivity Particulars ! !8 Ad ,!8 () Standard 'oefficients / =eta &> ?alue '.!(4(a) '.%77 '.%74 .(2' '.!(4 ((.(75 (2!.88 firms SO.!'E: SPSS N#90/ M R 5orrelation 5oeffi*ient or >eta R 5oeffi*ient of 6etermination M2 )d8. M2 R )d8.sted 5oeffi*ient of 6etermination

Sig, '.'''

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6J R 6.r,in Jatson (d) test statisti* 9-4al.e R St.dent t- test Statisti* B R B- test statisti* Model 0A.ation IM R '.574 T '.844 OP 9+e res.lt indi*ate t+at t+ere was a positi4e signifi*ant effe*t of in4entor2 management on organisational prod.*ti4it2 as t R ((.(75 and w+i*+ is a,o4e t+e r.le of t+.m, positi4it2 of 2 and t+e *oeffi*ient of in4entor2 management is ('.574). t+e 4ariations from t+e model is e?plained ,2 t+e model as indi*ated from t+e *oeffi*ient of t+e determination (r2) 4al.e of !(.4E. )lso t+e res.lt indi*ates t+at t+ere is a positi4e relations+ip ,etween in4entor2 management and organisational prod.*ti4it2 as indi*ated ,2 r 4al.e of '.!(4 w+i*+ is positi4e as s+own ,2 ,eta 4al.e of '.!(4 &o what e@tent does inventory management correlate with organisational $rofitability, &able ;: 'oded !es$onses on inventory management and organi+ational $rofitability, S,Agree (isagree .ndecided s-no "uestionnaire items -Agree -S,(isagree 1 /re0 1 /re0 1 /re0 ( 9+ere is positi4e relations+ip ,etween in4entor2 management in*rease s+are+older wealt+K In4entor2 management promotes organisational net in*ome growt+K 9#9)F

&otal 2/reg3 805

*40

4*

*0

80* :4*

49

: **

6 *6

805 6*;

Source: fieldwor< 80*8 )**ording to ta,le (!) ,ased on aggregate response 8'!(88E) indi*ated strongl2 agree& 74(8) indi*ated disagree w+ile %2 (4E) indi*ated .nde*ided. 9+is implies t+at t+ere is a relations+ip ,etween 8o, satisfa*tion and organi;ational *ommitment among se*ondar2 s*+ool tea*+ers in 0n.g. State. #i *: there is a $ositive correlation between inventory management and organisational $rofitability &able 9 (escri$tive Statistics of correlation between inventory management and organisational $rofitability in4entor2 management organisational profita,ilit2 Mean (. 5( 2.2!44 Std. 6e4iation (.'8'(7 (.%'857 N 2'8 2'8

&able 5 'orrelations between inventory management and organisational $rofitability in4entor2 management ( 2'8 .84%(QQ) .''' 2'8 organisational profita,ilit2 .84%(QQ) .''' 2'8 ( 2'8

in4entor2 management

organisational profita,ilit2

Pearson 5orrelation Sig. (2-tailed) N Pearson 5orrelation Sig. (2-tailed) N

QQ 5orrelation is signifi*ant at t+e '.'( le4el (2-tailed). 9a,le 7 s+ows t+e des*ripti4e statisti*s of t+e in4entor2 management 4ia organisational profita,ilit2& wit+ a mean response of (. 5( and std. de4iation of (.'8'(7 for in4entor2 management and a mean response of 2.2!44 and std. de4iation of (.%'857 for organisational profita,ilit2 and n.m,er of respondents (2'8). >2 *aref.l o,ser4ation of standard de4iation 4al.es& t+ere is no m.*+ differen*e in terms of t+e standard de4iation s*ores. 9+is implies t+at t+ere is a,o.t t+e same 4aria,ilit2 of data points ,etween t+e dependent and independent 4aria,les. 9a,le 8 is t+e Pearson *orrelation *oeffi*ient for in4entor2 management and #rganisational profita,ilit2. 9+e

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*orrelation *oeffi*ient s+ows '.84%. 9+is 4al.e indi*ates t+at *orrelation is signifi*ant at '.'5 le4el (2tailed) and implies t+at t+ere is a positi4e relations+ip ,etween in4entor2 management and organisational profita,ilit2 (r R .84%). 9+e *omp.ted *orrelations *oeffi*ient is greater t+an t+e ta,le 4al.e of r R .( 5 wit+ 2'! degrees of freedom (df. R n-2) at alp+a le4el for a two-tailed test (r R .84%& pS .'5). <owe4er& sin*e t+e *omp.ted r R .84%& is greater t+an t+e ta,le 4al.e of .( 5 we re8e*t t+e n.ll +2pot+esis and *on*l.de t+at t+ere is a positi4e *orrelation ,etween in4entor2 management and organisational profita,ilit2 (r R.84%& PS.'5). /indings )fter testing of t+e +2pot+eses& it was dis*o4ered t+at t+ere was 9+ere is signifi*ant relations+ip ,etween good in4entor2 management and organi;ational effe*ti4eness(r R.8 8& PS.'5). In4entor2 management +as a signifi*ant effe*t on organi;ational prod.*ti4it2(r R.!(4I tR ((.(75I PS.'5). 9+ere is +ig+l2 positi4e *orrelation ,etween good in4entor2 management and organi;ational profita,ilit2(r R.84%& PS.'5). <owe4er& it was fo.nd t+at t+e organi;ations .nder st.d2 at times r.n into pro,lems of inadeA.ate sto*of in4entor2 w+i*+ *onseA.entl2 affe*ted t+eir prod.*tion& leading to s*ar*it2 of one ,rand of t+eir prod.*ts or t+e ot+er t+ere,2 affe*ting t+eir profita,ilit2 and *onseA.ential effe*ti4eness. 'OA'%.SIOA In4entor2 Management is 4er2 4ital to t+e s.**ess and growt+ of organi;ations. 9+e entire profita,ilit2 of an organi;ation is tied to t+e 4ol.me of prod.*ts sold w+i*+ +as a dire*t relations+ip wit+ t+e A.alit2 of t+e prod.*t. Management does a lot to present a good organi;ation to t+e p.,li* in terms of A.alit2 prod.*tion. Hood in4entor2 management in an2 man.fa*t.ring organi;ation& sa4es t+e organi;ation from poor A.alit2 prod.*tion& disappointment of seasoned *.stomers& loss of profit and good so*ial responsi,ilit2& (Go+nson& 2''8/4'). 9+is is done ,2 ens.ring timel2 deli4er2 of raw materials to t+e fa*tor2 and distri,.tion of finis+ed goods& in order of prod.*tion to t+e ware+o.se. If in4entor2 management is not adeA.atel2 maintained& prod.*tion *annot meet t+e aspirations of *.stomers w+i*+ is loss of re4en.e to t+e organi;ation. Mig+t from pro*.rement to t+e time of pro*essing& A.alit2 of raw material is t+e *+ief determinant of t+e prod.*ti4e effi*ien*2 of an2 man.fa*t.ring *on*ern. 9+is 4aries from organi;ation to organi;ation. In 0menite& t+e raw materials are 4olatile and *+iefl2 *ement w+i*+ is pro*.red lo*all2. 9+e pro*essing ma*+ines and te*+nolog2 are& +owe4er imported. In <ardis and 6romedas& t+e raw materials are man2& and are .p to 'E lo*all2 so.r*ed. Spe*ial *+emi*als are +owe4er& imported. In t+e Nigeria >ottling 5ompan2& t+e main raw materials are *olo.r and Meagent& w+i*+ is imported. #t+er raw materials are water and s.*rose w+i*+ are lo*all2 so.r*ed. 9+e organi;ations *om,ine t+e Birst-in-Birst-o.t (BIB#) and )4erage Met+ods in t+eir in4entor2 allo*ations. !ecommendations In line wit+ t+e findings& t+e following re*ommendations are made/ (. 9+e organi;ations s+o.ld di4ersif2 t+eir in4entor2 s2stem& to s.it spe*ifi* needs of prod.*tion. 2. In4entor2 management s+o.ld ma?imi;e spa*e and timel2 deli4er2 to a4oid sta2ing off prod.*tion. %. 9+e o4erriding need for an2 met+od of sto*- allo*ation s+o.ld ,e *.stomer satisfa*tion. 4. 5ost minimi;ation te*+niA.es s+o.ld ,e emplo2ed in t+e -eeping and allo*ation of in4entor2. 5. Management s+o.ld *losel2 monitor and manip.late t+eir in4entor2 s2stem to maintain prod.*tion *onsisten*2 for organi;ational profita,ilit2 and effe*ti4eness. !eferences )mog. #. 0-e (2''5)& Elements of Production Management, 0n.g./ #-te- P.,lis+ers 5+ristian I-e #nw.*+e-wa (( %)& Management Theory And Organizational Analysis: A Contingency Theory Approach, 0n.g./ #,io (Nig) 0nterprises. Blo2d 6. <endri*-&Bran*- 5. >arnes& 0dward J. 6a4is& and 6. 5la2 J+2,a*-& (2'(() Inventory Management +ttp/CCwww.ose*.do*go4Co,iC Ile N. M. (2''()& Management, Theory and Practice& 0n.g./ #*+.m,a Printing and P.,lis+ing 5o. Ftd. Ile N. M. (2''2)& Management, A unctional Approach, 0n.g./ #*+.m,a Printing and P.,lis+ing 5o. Ftd. Gona+& K.I. (2'(()& !udiments of Management& Fagos >.siness S*+ool& (2(%) Go+nson& >.>. (2''8)& :#rgani;ational 5ontrolL& "ournal of #usiness Management, 8( (('2) M* )ndason& ). (2''')& :Inventory Management !evisited&L <ar4ard >.siness S*+ool 8(( (((2!). Moore F.G.& Fee S. M. and 9a2lor& III >.J. (2''%)& Management $cience& 4t+ 0d& )ll2n and >a*on& Need+am <eig+ts M).

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N.6. $o+ra (2''8)& %uantitative Techni&ues in Management New 6el+i& 9ata M* Hraw- <ill P.,lis+ing 5o. Ftd. Nwand. (2''!)& Principles of Management, 0n.g./ )llmar- P.,lis+ing Ftd. Nwe;e ).3. (2''4)& %uantitative Approach to Management Accounting& 0n.g./ )ma;ing Hra*e Printing and P.,lis+ing 5o. #+no& >& (2''8)&LManagement of Inventories' (arvard #usiness $chool& ((28 ((224). #rga 5.5. (2''!)& Productions Management A %uantitative Approach& 0n.g./ $eamar-s P.,lis+es. Plossl& >. (2''5), Management, New @or-/ Prenti*e <all In*. Mi*+ard >. 5+ase and Ni*+olas G. )A.ilano (( 5)& Production and Operations Management, 3S)/ $on <offmann Press& In*. Sawa2a Gr. and Hia.A.e (2''!)& Production and Operations Management #rlando BF/ <ar*o.rt >ra*e Go4ano4i*+ In*. Sim,o ). >an8o-o (2''4)& Production And Operations Management, I,adan/ #l.se2i Press Fimited $.). 9emeng& P.). 0s+.n and P.M.K. 0sse2 (2'(')& Inventory Management, International Mesear*+ Go.rnal of Binan*e and 0*onomi*s& +ttp/CCwww.e.ro8o.rnals.*omCfinan*e.+tm 3;oag.l.& 0. ). (2'(()& *riting !esearch Pro+ect !eports 0n.g. 5+eston Ftd. @o.ng #. B. (2''2)& Customer !elations, ),a/ Ngwaland P.,lis+ers Uigm.nd& B. (( 4)& $ampling ,istri-ution& Fondon/ 5+a2man.

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