The Effect of Inventory Management Practice on Organizational Performance: The Case of Inventory Management Department of Commercial Bank of Ethiopia
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Date
2024-06
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Addis Ababa University
Abstract
The purpose of this study is to analyze how inventory management practices affect anorganization's performance within a bank. One of the biggest and most established banks in
Ethiopia, Commercial Bank of Ethiopia, is the study's location. The organization responded tothe questionnaire using a systematic five-point Likert scale questionnaire, performance was
evaluated quantitatively. Descriptive and explanatory research designs were used. Regarding theresearch approach, the researcher used a mixed technique employing a questionnaire to meet
the study's specific and overall objectives. The target population was conducted at the Inventorydepartment of CBE, Addis Ababa. Concerning the sampling technique, a purposive sampling
technique was used. About methods of data analysis descriptive and regression data analysiswas used. The data was analyzed using SPSS ver 16.00. There was a finding that both the
independent and the independent variables have a mean score below 3.40 which is consideredhigh. The second finding is that among the four independent variables which are, Information
Technology, Inventory Control Techniques, and Inventory Cycle counting had a p-value greaterthan 0.005 which shows an insignificant value. Lastly, the warehouse management was found to
be significant and positive with a sig value of 0.00 and a beta value of 0.77. It is concluded thatthe dimensions that measure the independent variables and the dependent variable have a mean
score of below 3.40, which signifies a “high level” of inventory management practice and a“high level” of organizational performance respectively. The regression analysis reveals a
significant, positive effect of warehouse management on organizational performance. Thisimplies that increasing warehouse management could positively affect performance, this data
supports the hypotheses (H4). It is recommended that the organization takes more action on thewarehouse to upgrade the performance of the organization. Further research should be carried
out in other banks to find out if the same results can be obtained.
KEY WORDS- Performance, information technology, inventory control technique, inventory
cycle counting, warehouse
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