NURSING MANAGEMENT

SEMINAR
ON

MATERIAL MANAGEMENT-Concepts, aims and

objectives, principles and methods

SUBMITTED TO SUBMITTED BY
DR. BEENA M R SARANYA RS
ASSOCIATE. PROFESSOR II YEAR MSc NURSING
GOVT. COLLEGE OF NURSING GOVT. COLLEGE OF NURSING
THIRUVANANTHAPURAM THIRUVANANTHAPURAM
SUBMITTED ON: 13/01/2021

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 INDEX

SL CONTENTS PAGE NO.

NO.
1 Introduction 04
2 Definition 05
3 Concept of material management 06
4 Advantages of material management 06-07
5 Importance of material management 07
6 Purpose of material management 07-08
7 Aims of material management 08
8 Objectives of material management 08-09
9 Principles of material management 09-11
10 process of material management 11-16
11 Conclusion 16
12 Journal abstract 17
13 Bibliography 18

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GENERAL OBJECTIVE

At the end of the class, the group will gain adequate knowledge about material management and will
be able to apply skillfully with a positive attitude.

SPECIFIC OBJECTIVES

At the end of class students will be able to

➢ define material management

➢ list down the advantages of material management
➢ enlist the importance of material management
➢ elaborate the purposes of material management
➢ list down the aims of material management
➢ describe the principles of material management
➢ explain process of material management

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 INTRODUCTION

“Management is doing things right; leadership is doing the right things.”

-Peter F Dracker.

Materials Management is simply the process by which an organization is supplied with the goods
and services that it needs to achieve its objectives of buying, storage and movement of materials.
Material management is the coordinated function, responsible for planning, acquiring, stocking,
moving and controlling the appropriate material of right quality, right quantity at right place in right
time so as to optimize the usage of facilities and capital funds in order to provide customer patient
service. It is only possible by efficient materials management.

Material management is one of the key factors for improving performance of any
health unit. Proper management of materials, therefore, assumes considerable importance in
functioning of health services as well as national economy. It is generally observed that senior
functionaries of health do not pay desired attention to material management, which results in
inefficiency. 40 per cent of the funds are utilized in providing material. In the absence of materials
manpower will be rendered non-functional.

Materials include equipment, apparatus, and other supplies used for patient care.
'Material' refers to commodities purchased and stocked by an institution for the purpose of
consumption and rendering service (Bharucha, 1989).

DEFINITION

MATERIAL

‘Material’ refers to commodities purchased and stocked by an institution for the purpose of
consumption and rendering service. (Bharucha, 1989)

MATERIAL MANAGEMENT

• Material management is defined as system of planning, organizing, directing, coordinating,

and controlling, maintaining adequate equipment and supplies where by right quantity and

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 quality of stock items, properly stored, easily retrievable and distributed for the use whenever
required at a given time.
- IGNOU
• Material management is a scientific technique, concerned with planning, organizing and
control of flow of materials, from their initial purchase to destination.
- Thomas F. Wallace and John R. Dougherty
• Materials management is a total concept having its definite organization to plan and control
all types of materials, its supply, and its flow from raw stage to finished stage so as to deliver
the product to customer as per his requirements in time. This involves materials planning,
purchasing, receiving, storing, inventory control, scheduling, production, physical
distribution and marketing.

- International Federation of Purchasing and Materials

Management

• Material management is the integrated function of an organization dealing with supply of

materials and allied activities in order to achieve the maximum co-ordination and optimum
expenditure on materials.

- Khare and Monga

• As applied to nursing services, "the management and control of medical, surgical and
clerical, inter-department services and equipment from acquisition on floor to disposition of
patient care.”

- Judith and Maradole

• Material management is the management of goods services and equipment from acquisition
to disposition.

- Housely

CONCEPT OF MATERIAL MANAGEMENT

The concept of Material management is relatively a new concept in India and in health care field.
Term was unknown in India till 1960’s. Terms such as purchasing, store keeping, transportation,
etc. were used in country which in a vague manner represented the functions covered by modern

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material management. Modern techniques of efficient material management were developed in US
of America during & after 2nd World war which helped industrial developed to make spectacular
progress in improving their productivity. Many hospitals have started adopting this management
concept in whole or in part to accomplish the objectives of providing efficient patient care due to
increasing awareness of importance of material management in last few years.

Material management is concerned with providing the supplies and equipment needed by health
personnel to deliver health services. The right supplies and equipment must be at the right place, at
the right time and in the right quantity in order that health personnel deliver health services.
Without proper material, health personnel cannot work effectively, they feel frustrated and the
community lacks confidence in the health services and unless an appropriate material are provided
in proper time and is required quantity, productivity of personnel will not be up to expectation.
Close coordination of all departments which are concerned with utilisation of materials. If some of
functions are to be separately handled, normally a conflict of interest occurs & there is bound to be
an increase in materials costs. In an integrated set up, materials manager is responsible for all such
inter-related functions & is in a position to exercise control & coordination with a view to ensure
proper balance of conflicting objectives of individual functions. Integrated material management
concept has recently gained greater importance in India. Although organisations may not be
adopting it in totality, there is a definite tendency to move towards an integrated approach.

ADVANTAGES OF MATERIAL MANAGEMENT

• Better Accountability- Centralisation of authority & responsibility for all aspects of

materials functions ensures specific accountability.
• Better Coordination- Coordination of various functions of material management is
facilitated.
• Better Performance- As all inter-related functions are integrated organisationally, an
effective communication & enhanced performance is natural sequelae.
• Adaptability To Electronic Data Processing (EDP)- All information with regard to
materials functions is centralised. This facilitates collection, collation & analysis of data
leading to better decisions. Advanced & efficient EDP systems can be economically
introduced under integrated set up.
• Miscellaneous Advantages- Team spirit is inculcated resulting in coordination &
cooperation. Opportunities of growth & development are better in integrated set up.

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IMPORTANCE OF MATERIAL MANAGEMENT

The fast developing Indian economy has placed a tremendous challenge and responsibility before
the-material manpower. It is generally found that materials represent the most expensive asset of
any organization. Mismanagement of this asset leads to serious losses. On the other hand its
judicious management will minimize losses and achieve maximum service for which they are
meant.

As stated by Gopal Krishnan, "The importance of material management lies in the fact that any
significant contribution made by the material manager in reducing materials cost will go a long
way in improving the profitability and rate of return on investment."

Planning and control of the functions supporting the complete cycle (flow) of materials, and the
associated flow of information. These functions include:-

➢ Identification
➢ Cataloguing
➢ Standardization
➢ Need determination
➢ Scheduling
➢ Procurement
➢ Inspection
➢ Quality control
➢ Packaging
➢ Storage
➢ Inventory control
➢ Distribution
➢ Disposal also called as material planning.

PURPOSE OF MATERIAL MANAGEMENT

• To gain economy in purchasing

• To satisfy the demand during period of replenishment
• To carry reserve stock to avoid stock out
• To stabilize fluctuations in consumption

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 • To provide reasonable level of client services
• Increase efficiency of health care system.
• Develop knowledge and skills of health care.
• Provide materials in required quantity quality as when required.

AIM OF MATERIAL MANAGEMENT

The aim of material management is to bring about control over acquisition, storage, retrievability,
distribution, use and disposal of supplies and equipment in order to carry the primary responsibilities
of an organization in an efficient, effective and economical manner.

Material management seems to ensure availability of :-

❖ The Right material
❖ The Right quality
❖ Right quantity of supplies
❖ At the Right time
❖ At the Right place
❖ For the least cost

OBJECTIVES OF MATERIAL MANAGEMENT

PRIMARY OBJECTIVES
➢ Right price
➢ High turnover
➢ Low procurement & storage cost
➢ Continuity of supply
➢ Consistency in quality
➢ Good supplier relations
➢ Development of personnel
➢ Good information system

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 SECONDARY OBJECTIVES
➢ Forecasting
➢ Inter-departmental harmony
➢ Product improvement
➢ Standardization
➢ Make or buy decision
➢ New materials & products
➢ Favourable reciprocal relationships

PRINCIPLES OF MATERIAL MANAGEMENT

BASIC PRINCIPLES

Basic principles of material management are following :-

➢ Effective management & supervision; It depends on managerial functions of

❖ Planning
❖ Organizing
❖ Staffing
❖ Directing
❖ Controlling
❖ Reporting
❖ Budgeting
➢ Sound purchasing methods
➢ Skilful & hard poised negotiations
➢ Effective purchase system
➢ Should be simple
➢ Must not increase other costs
➢ Simple inventory control programme

ESSENTIAL PRINCIPLES

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 There are seven Essential principles of material management which must be kept in mind to
ensure good results. Health managers should follow the principles or rights.

1. Right Item

2. Right Quality

3. Right Price

4. Right Source

5. Right Delivery

6. Right Method

7. Right People

TECHNIQUES TO APPLY ESSENTIAL PRINCIPLES

Materials can essentially be categorised under three heads that is vital, essential and desirable. These
three categories must determine how much quantity of each item should be stocked by the
storekeeper.

Various techniques are available to decide on right item, quantity, price, source, delivery methods
and people. The technique as follows –

1.Right Item

➢ Value analysis
➢ Standardisation
➢ Codification

2.Right Quality

➢ Purchasing
➢ Balancing of Inventories
➢ EOQ (How much to buy and when to buy)

3.Right Price

➢ Cost
➢ Price
➢ Value analysis

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4.Right Source

➢ Market Research
➢ Purchasing Techniques
➢ Selection

5.Right Delivery

➢ Procurement Techniques
➢ Follow up

6.Right Method

➢ Work Study
➢ ABC Analysis
➢ Management Information System

7.Right People

➢ HRD
➢ Organizational Analysis
➢ Behavioural Sciences

THE PROCESS OF MATERIAL MANAGEMENT

The process of material management include the following steps –

1. Budgeting and Materials Planning

2. Demand Forecast

3. Procurement

4. Inspection and Quality Control

5. Storage

6. Inventory Control

7. Issue and Distribution

8. Maintenance

9. Disposal and Condemnation

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 1. BUDGETING AND MATERIALS PLANNING
The listing of materials in terms of units required and their cost estimates would
constitute the materials budget, which should be prepared annually. This preparation of
budget would be based on past levels of performance and on anticipated activity, capital
equipment, consumables and supplies to be procured.

Important budgetary control and reduction of material costs is the concept of

standardization. This involves grouping together similar items depending on their
specifications or use so as to choose one of those more universally acceptable for the
purpose. It does not imply just cutting down on the number of sizes which is generally
termed as simplification but adoption of standards leading to specification of quality,
reduction in sizes and varieties, facilitating interchangeability of components etc.

Concept of value analysis is also related to standardization. This attempt to examine all
facts of the function and cost of product/ item used in order to determine whether the cost
can be reduced without compromising on quality.

Value analysis attempts at addressing the following issues:

· What is the Item?

· What is it intended to do?

· How much does it cost?

· How can an item do the same job?

· What are the suggested alternative costs?

2. DEMAND FORECAST
After finding out what is require and how much money do we have in hand, we have to
find out how much is required, anticipation of future need is done through demand
forecasting biased on past consumptions patterns.
Estimation of right amount of each equipment is the most crucial factor for maximum
use and minimum wastage. Reduce number and variety of materials will lead to less
problem of management.

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 Demand estimation of category of material should always be done keeping in view the trend
in consumption pattern over the last 2-3 years, the objective of the organization, change in
the clientele, changing emphasis on various programmes and activities in the health field or
organization this is known as casting and forecasting in nursing service administration.

The common methods are to forecasting the demands are –

➢ Last period demand forecast for the next period is done on the basis of the level
of demand that occurred in the previous period.

➢ Arithmetic average: Average of all past demands is taken for forecasting

demand.

➢ Moving average: Forecast for the next period is generated by averaging the
actual demand for last 'n' time periods where 'n' can be about (2-3 years).

3. PROCUREMENT
Procurement is the acquisition of material from an external source. An effective
purchasing system aims at procurement of items of acceptable quality in appropriate
quantity at minimum price and within an available time.

When you have listed down the requirements the next process is procurement of those
items. Most hospitals have a set of rules and regulations regarding the procedures of
ordering materials. A purchase department may be available and financial authority may or
may not be vested in this department. In some institutions a purchase committee may be
established beyond the purchase department to scrutinize all the indents or demands as per
priority for procurement of materials. The basic principle in all these rules and regulations
of procedure is to maximize the value of money invested in purchase.

Different systems are available for procuring materials from manufacturing companies. Few
of them, which are practiced in our country, are explained here.

1) Fixed Quantity Contract: This type of contract is generally extended, where firms are
called to offer materials and a definite number are asked to supply.

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2) Running Contract: These are contracts for the supply of an approximate quantity of
materials at a specific price during a certain period of time.

3) Rate Contract: These are the most important contracts as far as health institutions are
concerned. In this, the firms are asked to supply materials at specific rates during the period
covered by the contract and fixed quantities are not mentioned. The list of materials required
is given to the contractors and they provide materials to the demanding office. Watch very
carefully the progress of rate contract procedures.

A purchase committee or department can provide maximum flexibility in ordering specified

quantities of material at regular interval. This helps us to maintain optimum inventories and
minimize the chance of deterioration or obsolescence of materials. Here the quality of the
material to a large extent is assured because only the needed material is given for contract.

4. INSPECTION AND QUALITY CONTROL –

(Receipt, Inspection, Acceptance and Payment)

As soon as the ordered materials are received in the goods receiving store, inspection should
be carried out. The material should be picked upon a random sampling method and it should
be inspected physically and chemically (where required). The organization should have
inspection policy, procedures and the basic facilities for the inspection and examination.
Investment should be done on sound sampling policy and procedures. This will assure the
right quality of materials supplied to the organization.

Points to Remember
1) Receive all items.

2) Check the same against specification and arrange for inspection.

3) Inform the end users regarding the receipt of materials.

4) Prepare receipt notes and inform excess or shortage of items received.

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 5. STORAGE
Materials after being inspected and received are stored in the storeroom till its
distribution and consumption.
The objective of storage is to ensure that the issue of material for usage of the supplies
are adequately preserved to prevent loss or damage.
The store should be located near the other stores of the hospital. It should be
accessible to the suppliers and indenters. Location should be as per activity of the stores.
Size should be adequate to accommodate all materials such as instruments, appliances steel
racks with shelves. Refrigeration should be available for storing thermo-labile items.
Many stores maintain two bins method or card system. This method separates the entire
stock of each item into two bins or boxes. One bin contains main stock and the second bin
contains enough stock to satisfy the demand during lead-time. Lead-time is the time
between placement of order and receipt of the same order. As soon as the first bin is
exhausted, demand for the order is placed and the second bins item are issued. Part of new
stock received is placed in the second bin as reserve.

6. INVENTORY CONTROL
Principles of inventory control seek to minimize investment on materials so that
sufficient working capital is available for other important activities of the organization.

The primary aim of inventory control is to decrease material cost by preventing over
staking the material which result in locking up of capital, possible pilferage and
obsolescence.

7. ISSUE AND DISTRIBUTION

Arrangement of materials can be done alphabetically or Group wise. Both are easy for
identification and retrieval.

Items held in inventory by the stores may be issued through indents to the user
department on periodical basis.

Materials should be stored on both sides of open rack. These racks are always filled
from backside and issued from front side. Materials received later from the suppliers should
be stored behind. By this you maintain the principle of "FIRST IN FIRST OUT". "FIFO"
means issuing items first which are received first.

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 8. MAINTENANCE
A large variety of materials are used in the hospitals. An average hospital needs more
than 3000 items of instrument and equipment’s. This shows the type of stores used for
patient care in the hospital and therefore its management and maintenance itself is very
important.
Material management is an important aspect of resource management. Proper
management of materials are very crucial to all the organization and we the nurses play a
vital role in controlling, maintaining and inspecting the materials time to time for efficient
and effective patient care. The nurse in her unit is the user of various equipments, therefore
she needs to maintain the equipment for their longetivity.

Purposes of Controlling and Maintaining Equipment

➢ To make materials available in safe and viable condition as necessary for both
elective and emergency situation.

➢ To increase efficiency of the organization.

➢ To provide material at an optional cost.

➢ To cut down material cost through standardization.

9. DISPOSAL AND CONDEMNATION

Indents are often arbitrarily made with improper scrutiny. This leads to an unofficial
inventory in the nursing units. It is therefore necessary for a nurse administrator to inspect
the stores periodically and return the excess stock to the main store, or condemn articles on
the spot to prevent the store in becoming a dumping place. Usually, all hospitals have a
condemnation committee, whose duty is to review the stock from time to time and assess
the materials that are to be disposed or condemned.

CONCLUSION
Material management is an important management tool which will be very useful in getting the
right quality & right quantity of supplies at right time, having good inventory control & adopting
sound methods of condemnation & disposal will improve the efficiency of the organization & also
make the working atmosphere healthy any type of organization, whether it is Private, Government

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,Small organization, Big organization and Household. Even a common man must know the basics
of material management so that he can get the best of the available resources and make it a habit to
adopt the principles of material management in all our daily activities

JOURNAL ABSTRACT

• STUDY ON MATERIAL MANAGEMENT-AN ART OF REVIEW

Ezhilmathi Pugazhenthi Sri Ramakrishna Institute of Technology | SRIT
Abstract
The Construction industry of India is a significant indicator of the development as it creates
investment opportunities. The opportunities are diminishing due to improper management. Cost
overrun is considered as the most important problems that encumber projects progress, since it
reduces the contractor's profit leading to enormous losses, and leaving the project in great troubles.
Material management is a critical element of the construction industry. The effective materials
management plan enhances an institutional master plan by filling in the gaps and generating an
environmentally liable and resourceful outcome. Materials management can deal with planning and
building design for the movement of materials, the acquisition of spare parts and replacements,
quality control in purchasing and ordering parts, and the standards involved in ordering, shipping,
and warehousing the required materials. Better construction management is required for optimizing
resources and maximizing productivity, efficiency and complete project on time.
• A REVIEW ON MATERIAL MANAGEMENT THROUGH INVENTORY
MANAGEMENT
Hemishkumar Patel
Birla Vishvakarma Mahavidyalaya Engineering College | BVM · Department of Civil
Engineering

Abstract
Construction materials usually constitute a major portion 50-60% of the total cost in a building
construction project. Materials management is made problematic by materials shortages, delays in
supply, price fluctuations, damage and wastage, and lack of storage space. To manage a productive
and cost efficient site efficient material management is very essential. Inventory management
system involves procurement, storage, identification, retrieval, transport and construction methods.
This study proposes to apply the Material management and Inventory management technique

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which includes well documented procedures to decrease the cost and increase in profit during any
construction project Lifecycle.

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