Codification in Materials Management

Codification of materials can also be termed as the identification of materials. This deals with uniquely identifying each item in the inventory. It is a simple concept. For a good quality control system a unique identification is a pre-requisite.

1. CODIFICATION Presented by: Amol Chavan Rimu Bhat Sameer Dhurat Subject: Materials Management Under: Prof. Nitin Shinde

2. CODING Systematic concise representation of equipment, raw material, tools, spares, suppliers . Coding refers to the process of assigning symbols to the parts. Coding is define as process of allocating symbol to the parts. The symbol represent design characteristics of parts , manufacturing attributes or both.

3. IMPORTANCE OF CODING Due to industrial requirement organization has to store large no. materials. Therefore there should be some mean of identifying them hence Coding is used. Classification and codification of materials are steps in maintaining stores in a systematic way.  Materials are coded in such way that storing, issuing and identifying of materials become easy.

4. CRITERIA FOR EFFECTIVE CODING Code should be Simple. Code should be unique. Coding should be compact, concise and consistent. Code should be sufficiently flexible to meet future demands.

5. OBJECTIVES OF CODING To bring all similar items together under one classification or group. To classify an item according to its nature of characteristics. To avoid duplication and confusion. To fix essential parameters to specify an item.

6. STORES VOCABULARY When large number of materials have been given codes, it becomes difficult to remember them. For easy reference, the organization is publishing the codes and names of materials in books . The stores vocabulary may be published in number of volumes of books when large number of materials are required in the organization . Number of volumes of books may be categorized depending upon group of materials required in the organization Example: In the Railways, the categories of materials required are in lakhs .

7. COMMON METHODS OF STORE CODIFICATION A lphabetical codification Numerical codification Mnemonic codification Combined alphabetical & numerical codification Decimal codification British/ Brisch codification Kodak codification Colour codification

8. ALPHABETICAL SYSTEM The ‘Alphabets’ are used as symbols or codes to identify the items of stores. Group of items according to their nature and use are allotted an alphabetical starting code and other alphabets are used to identify exact items.

9. NUMERICAL SYSTEM The numerical system of codification uses only numbers as codes of various materials kept in the stores. It is simple method and easy to understand. Simple Number: To represent different groups of items. Either one number 0 to 9 is allotted to each item of a group. If total items in a group are more than 10, then two numbers 00 to 99 are allotted and so on.

10. Block Number : To represent material belonging to each of the items as subgroups. The material of same characteristics or having similarities are sub grouped as one item. The block can be of three or more numbers Dash(-) or stroke(/): It is used in between numbers to represent the material belonging to sub-group.

11. When we use letters to help memory, we call such a system a mnemonic system. A special application of the alphabetical system. Alphabets are allotted to an item according to its initials or abbreviation Eg: Stainless steel: SS Copper: Cu MNEMONIC SYSTEM

12. Advantages: It is an alphabetic system designed with an objective of easy memorization. Disadvantages: This system is confusing: one symbol may convey impression of two or more objects Eg: Tb : Tablet or Tube

13. It is the combination of both the alphabetical and the numerical system In order to improve upon the alphabetical system, and also to take advantage of the numerical system, this system allows alphabets to be retained to a limited extent and then uses the number codes. The materials are first grouped under some main classes and then it allows sub grouping under numbering system COMBINED ALPHABETICAL AND NUMERICAL CODIFICATION

14. Parameters Main group Sub-group 1 Sub-group 2 Copper Cu Sheet Sh 5mm thickness 05 Thus, code for Copper Sheet of 5mm thickness is : CuSh05 Example:

15. Decimal Codification It is simple and easy to codify items under this system. Under this system items up to 5,00,000 can be easily codified and at the same time each symbol will give the history, size, specification and complete picture of the item . Modern industrial concerns are generally adopting 7 to 11 digits for codifying the materials . In the decimal codification system, each digit indicates some thing or the other. For example :

16. Example Main Group Sub- Group 1 Sub- Group 2 Copper 01 Copper Sheet 02 Copper Sheet 5mm Thick 03 Thus, the code of Copper Sheet 5mm Thick = 01.02.03

17. COLOUR CODING Color-coding easily identifies small parts. The various cables and wires of different colours are used in electrical fittings to identify their polarities. Colour codes are also used in foundries to identify different patterns and metals. Generally is used for Pipelines, Raw materials , lubricants etc.

18. Example Private Cars Taxis

19. EXAMPLE

20. British/ Brisch Codification C onsists of 7 digits and is applied in 3 phases The items are grouped into suitable preliminary categories, such as: A ssemblies S ub assemblies Components off the shelf items. in order to bring similar item together The second block gives next level of classification based on the type of materials The third block gives the lowest level of classification normally the specifications

21. EXAMPLE

22. Kodak Codification C onsists of 10 digits of numerical code. Originated by Eastman Kodak Company . Based on numerical system of codification and combines all good other points . Divided into few broad classification called Basic Classification . The basic classification is restricted to 100 . Each class is then further divided into sub classes . Grouping is based on Source of supply

23. EXAMPLE 1. If bolt is listed as hardware item : Then will be available under hardware suppliers I f this bolt is available as a part of the machine : It will be available under maintenance 2. Eg – 40(Cutting Tools)0(drills) Each sub class is again further sub divided Eg – 400-00

24. Advantages of Classification and Codification Provides absolute clarity to the supplier as to what is required by the buyer Variety reduction Allows buying from more than one manufacturer Reduces inspection and quality costs Ensures interchangability of Parts . Routinises procurement efforts and reduces clerical work . Reduces procurement lead time .

25. Advantages of Classification and Codification Systematic grouping of similar items Enables the easy recognition of an item in the stores Minimizing of clerical work Accurate and logical identification Accurate and reliable accounting and recording Prevention of duplication Avoidance of Long description of Items

26. Groups of Materials Classification Raw Materials Components Consumables S pare Parts Supplies Tools P acking Materials Work-in-progress items F inished Goods

27. Groups of Materials Classification Completely knocked down items H ard ware items Fasteners S ubcontracted items W ires and cables P aints and chemicals

28. Stages of Scientific Codification 1. Identification – To know the type of material in detail 2. Classification – Description, Nature, Source or origin. 3. Codification – As per the requirement and the system

29. Need for codification Speed Saving of efforts Space saving on forms Ease of classification Mechanization

30. Codification for Axial Fans

31. EXAMPLE – PAN CARD BNZ P M 2501 F

32. Barcode Barcodes are machine readable symbols in the form of numbers and parallel lines used universally to identity and track products.  Barcodes play a key role in supply chains, enabling retailers, manufacturers, and transport providers to easily identify and track products as they move through the supply chain .

33. GS1 GS1 is a not-for-profit, industry-led global organisation headquartered in Brussels and oversees operations of 112 GS1 Organisations across the world . Over two million companies, across 25 industry sectors such as Retail, Healthcare, Transport and Logistics use GS1 standards . The majority of GS1 standards are endorsed and referenced in ISO standards.

34. Sectors Retail & FMCG Healthcare Food & Agriculture Transport & Logistics Government

35. Omnidirectional Today's consumers expect to seamlessly research, purchase and interact with the products they want to buy, no matter where they shop. GS1 standards are helping industry meet the challenges of omni -channel commerce and satisfy the expectations of consumers before, during and after purchase - whether they're shopping online, in-store or via mobile GS1 Keys GS1 ID Keys give companies efficient ways to access information about items in their supply chains, and share this information with trading partners.

36. Types of Barcode GS1 EAN/UPC Family Barcodes ID Key Used to Identify Example Global Trade Item Number (GTIN) Products and services Can of soup, chocolate bar, music album Global Coupon Number (GCN) Coupons Digital coupons

37. GS1 DataBar Family Barcodes

38. GS1 1D Barcodes

39. GS1 2D Barcodes

40. Before Computerization After Computerization After Barcode System Year 1990 During 2000 After 2005 to till now Shopping Medium General Store ( Kirana shops) General Store/Retailer (D-mart, Big Bazaar) Retailer Time per Customer 9 mins /customer 5 mins /customer 1 mins /customer Waiting time in Queue More Medium Less Saving Of Time No 4 mins 8 mins Fulfillment of Customer’s Unsatisfactory Needs No Yes/No Yes How Barcode system saves our time in India? -Suppose a customer purchase 40 items (sugar ,detergent ,soap ,biscuits etc ) Below situation is From year 1990 to 2017*

41. Dmart Powai Nerul 8 am to 10 pm 10 am to 10 pm People typically spend 15-45 min here People typically spend 15-45 min here

42. Big Bazaar Vile Parle Vashi 10.30 am to 10 pm 11 am to 10 pm People typically spend 15-45 min here People typically spend 20 min -1 hour here

43. In Supermarket Working Hours:10 am to 10 pm Demand is Always Fluctuating Days(per day) No. of Customer Weekday (Monday) Below 6 000 Weekend (Sunday) or During Festival Days Above 10 000 If 1 Counter Covers 300 Customers per counter per day If 1 min per customer = 300 mins If 2 min per customer = 600 mins Average=450 mins Approx. 7 hrs and 30 mins Then 20 Counters 300 customer s per counter per day 6000 customers in approx. 7 hrs and 30 mins D mart is available at 132 locations of India Big Bazaar available at 217 locations of India

44. Even you can send link of Website/Application through Barcode

45. REFERENCES Sadiwala , C.M ., & Sasiwala , Ritesh C. (2007). MATERIALS AND FINANCIAL MANAGEMENT. New Delhi: New Age International Publisher. http:// www.citeman.com/4466-codification-in-materials-management.html http:// www.shareyouressays.com/116388/8-common-methods-of-of-store-management-and-codification http:// www.materialsmanagement.info/inventory/inventory-cataloguing.htm https:// www.gs1india.org / https:// www.google.co.in /maps/place/ D+Mart /@ 19.1137341,72.8952685,15z /data=!4m8!1m2!2m1!1spowai+d+mart!3m4!1s0x3be7c7e5e89fa7cb:0x459b3d2d8905add3!8m2!3d19.1165003!4d72.9103888 https:// www.google.co.in /maps/place/ D+Mart+Nerul /@ 19.0311611,73.0197809,17z /data=!3m1!4b1!4m5!3m4!1s0x3be7c3c0b8726fb5:0x2e0d5332b960d244!8m2!3d19.0311611!4d73.0219696 https:// www.google.co.in /maps/place/ Big+Bazaar /@ 19.100518,72.8433463,17z /data=!3m1!4b1!4m5!3m4!1s0x3be7c9b41e8aa0c3:0x5ee1657ac714bfc3!8m2!3d19.100518!4d72.845535 https:// www.google.co.in /maps/place/ Big+Bazaar /@ 19.0640392,72.9946797,17z /data=!3m1!4b1!4m5!3m4!1s0x3be7c14da4b5ae11:0x472e121eb63ef35c!8m2!3d19.0640392!4d72.9968684

46. Thank you Any Questions