EFFECT OF INVENTORY MANAGEMENT ON THE ORGANIZATIONAL PERFORMANCE OF THE SELECTED MANUFACTURING FIRMS

Abstract

The study sought to ascertain the extent at which inventory control affect the productivity of selected manufacturing firms, to determine the nature of the relationship between demand management and customer satisfaction of selected manufacturing firms and to determine the effect of Just in- time on the growth of selected manufacturing firms. The study had a population size of 996, out of which a sample size of 285 was realized using Taro Yemeni's formula at 5% error tolerance and 95% level of confidence. The instrument used for data collection was primarily questionnaire and interview. Out of 285 copies of the questionnaire that were distributed, 270 copies were returned while 15 were not returned. The descriptive survey research design was adopted for the study. The hypotheses were tested using Pearson product moment correlation coefficient and simple linear regression statistical tools. The findings indicate that inventory control significantly affects productivity of selected manufacturing firms ( r = 0.849 ; t = 27.726 F = 768.754 p < 0.05 ) .There is a positive relationship between demand management and customer satisfaction of selected manufacturing firms ( r = 0.799 P<.05).Just in-time has a significant effects on growth of the selected manufacturing firms ( r = 0.885 ; t = 32.865; F = 1080.094 p < 0.05 ) The study concluded that inventory management is essential in the operation of any business. Inventory as an asset on the balance sheet of companies has taken on increased importance because many companies are applying the strategy of reducing their investment in fixed assets. The study recommended that Organizations should train their personnel in the area of inventory control management that will empower them to be in charge for the smooth running of the inventory management activities or program.