Factors That Affect the Effectiveness of Inventory Management of Ethio Telecom

Abstract

The aim of this study is to provide empirical indications for the factors that affect the effectiveness of inventory management of ethio telecom at the corporate level and recommend ways on the observed problems, and gaps. Information Technology, Procurement Procedures, Internal control over inventory and Inventory Carrying Costs has been taken as a major parameter for the comparison.  To meet the Objectives, the researchers used a quantitative approach with explanatory research design. The primary data were collected through questionnaires. A sample of 94 respondents was taken using a stratified sampling technique and then after simple random and purposive methods for sampling were used to select a sample from those strata. The study has employed statistical techniques such as correlation and regression analysis and test of assumptions to analyze the data from the survey using SPSS 20 software. The result of study showed that information technology and internal control over inventory has a significant positive relation with the effectiveness of Inventory management whereas procurement procedure and inventory carrying costs have significant negative relation. The researcher recommended that the organization should exhaustively integrate ERP Supply chain and financial modules. Item standardization should be implemented throughout the company to minimize obsolescence and over stocking of items. Modernizing the procurement process, to realize real time procurement thus increasing transparency in procuring goods. Inventory carrying costs should be kept at a minimum possible level since the goal of every business is to hold as little inventory as possible and keep their business running. In such a way, the concerned authority should work properly in keeping the entire flow of resource of the organization and keep them in a safe, protected, and proper place.

Keywords: Inventory, Inventory Management

DOI: 10.7176/RJFA/11-19-01

Publication date:October 31^st 2020