Poor inventory management at PSC Viet Nam Chemical Ltd. company

Abstract

This PSO thesis is aim to find and solve the problem that currently present in PSC company. Throughout PSO process, problem is will be well defined, root cause can be found, and the sustainable solution is proposed. This process can help PSC company improve its business performance and its competitive advantages. The starting point, company will be “scanned” by look over company financial statements. Those data are change into some financial indicators, which can reveal PCS business health. By evaluate this data, the symptoms can be found here are: high inventory turnover days, and low profit performance. Then, also use the secondary data to explore the symptom. This step is very important, because the symptom, itself combine from various components. Those component have to investigate to know exactly where the problems come from. In PSC, the issues are: high COGS, low revenue performance, and high inventory value. From the next step – Problem exploration, all research techniques can be used to find the possible problem. First, interview the problem owner, relative departments with above issue, along with supporting from primary data and literature review, to find what possible problems, they are: weak outbound logistic control and poor inventory management. Because inventory management consists of planning material, shipping, receiving, storing, and transferring raw material as well as finial product, it is important and critical management. If the first step of company has trouble, all the following steps will be affected. Therefore, BOD and plant manager decide main problem is poor inventory management. From the literature review, the possible causes of main problem are proposed: inaccuracy material planning, ineffective software integration, unstandardized procedure. Those causes are validated by PSC’s context, the evidences that those are present in organization. The main cause “unstandardized procedure” is determined by eliminating the other, because they have been dealing with in PCS. Because PCS have received all procedures from headquarter, but it is not up to date and not suitable to apply in PCS concept. The first solution is to apply SIPOC and MACM to scan and fix all those procedures to adapt and good to apply with PSC plant and SAP application. The second solution is to hire the third party; they will give the completely inventory management solution which adapt with PSC requirement. They apply cloud software and barcode to tracking and recording warehouse, planning, input and output control. This solution is good at not effecting to normal operating of other department when conduct project planning, however it takes time and a lot of effort to conduct, along with investing too high. Finally, the solution applying SIPOC and MACM to scan and fix all those procedures is selected. The action plan to make the change in process is expected to last for 15 weeks, combines 5 stages. Project is mainly managed by project manager, who is determined by business director. The human resource form from internal PSC company. In general, this PSO thesis is successful identify the business problem at PSC company. And give the complete solution to deal with the root cause, aim to improve sustainably business performance.