Effect of Inventory Management Practices on the Performance of Manufacturing Company: The Case of Addis Transformer and Switch- Gears
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Date
2023-06
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Addis Ababa University
Abstract
Every manufacturing company’s capacity to use resources effectively and efficiently depends on its inventory management practices hence the goal of this study was to investigate how this practice affected the performance of manufacturing companies in the case of Addis Transformer and Switch gears S.C. The study employed a mixed research approaches to obtain both qualitative and quantitative data starting with the general aims and working towards the particular objectives of how inventory management practices impact the operation of the organization. Both primary and secondary data were employed in the investigation process. Questionnaire was used to gather the primary data. 76 questionnaires were distributed and 71 resources were analyzed using correlation and multiple regression methods using SPSS version 20.The study reveals a positive correlation between the dependent variable( performance ) and the independent factors (demand foresting, stock-out, holding cost, technology and employee skill) but the independent variable stock-out has negative correlation with the dependent variable performance .However, the result of the regression analysis suggests that the independent variables accounts for 64.6% of the variance on the performance. The study suggested that the manual inventory management methods used by ATS need to be better systematized and supported by software. The study again recommends that the company must update its outdated working practices with more cutting-edge technology. It is preferable to adopt a variety of technological tools so as to improve its performance and the majority of the present employes of the companies are young professionals with limited experiences so providing training and courses will be a great help to improve the employee’s skill.
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Performance