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Evolution and History of Materials Management

The evolution or History of Materials Management starts with the US and World War I. Before the 1st World war, people were unaware of the importance of Materials Management, Inventory Control and Supply chain Management.

The concept of Material Management was strengthened with the research papers published by Harvard University.

The Abstract or summary of the history and evolution of Materials management is given as below.

Below are the key points associated with the evolution or history of Materials Management.

Evolution Speed: Slowly Evolved

Timeline & origin: Recent origin

The root of evolution: US Economy: World War I

1914 (Before World War I i.e. Before 1914): Material Availability – Large Quantity

1914 to 1918: (World War I from 1914 to 1918): Threat of materials shortage during war

1920-21: Heavy inventorying during the business collapse

1920: Control of materials management and the maintenance and repair of materials was the responsibility of purchasing managers in some industry.

1926-29: Profitless prosperity, prolonged depression,  all contributed to a better understanding of the inventory problem

1930: A better understanding of Inventory Problems

Improved means of transportation and communications, recognition of unnecessary costs of excessive inventory, rapid technological changes in product and manufacturing

Impact of scientific management

1939-1945: Increase in military personnel and materials requirement in US Defence force,  entered as a single largest buyer with the increasing emphasis on quality standards

1945: After World War II:

  • Shortage of Material
  • Increased Production, Population
  • Increased Demand

The need for Material Management

Birth to an entirely new approach and idea in the management field i.e. Material Management

Extensive studies in industrial purchasing practices by Prof. Howard T. Lewis of the Harvard Business School.

Prof. Howard Lewis made recommendations to many companies for the establishment of a new managerial position viz. the director of materials who look after activities including purchasing, inventory control, receiving, inspection, warehousing, traffic etc.

1970: Significant changes

History of Materials Management in detail

Material management as a discipline was rather slow to evolve as compared to production and marketing function.

Some elements of the function practised across organization all levels of but the birth of material management as a field of study and one of great relevance of business performance is of recent origin and had its root in the US economy.

In the past three centuries the human civilization developed from a supply constrained handicraft economy to today’s service economy.

Over the years from the simple mechanism of exchange of goods and services. It has transformed into a complex system of industrial production and commercial system.

It was during and after the world war 1st that supply’s to many of the manufacturing organizations got disrupted. The shortage during the war and heavy inventories build up during the great depression of the 1930s. both contributed to a better realization of inventories problem.

This only helped to understand the importance of material management with the advent of the industrial revolution as a result of improved techniques coupled with economic prosperity, the focus shifted to mass production and marketing. There was a premium on resources.

The population explosion along with income revolution further fuelled the demand for a whole range of product. The 1970s witnessed significant changes in the character of material management.

Evolution of Materials Management in India 

Tisco Was the  Ist Company to establish “Central Purchase  Dept.” incorporate.

1922: An Indian stores department established

Information Technology Contribution

Competitive Edge: Innovation in Technology and Techniques, Virtual Reality, & Globalization

Understanding of Current as well as future global trends

Integrated Material Management, SCM & Logistics.

The Indian scenario of adopting material management techniques is even slower cost consciousness is absent in the majority of Indian industry. The armed forces were the first to adopt material management by the name of “Logistics management”. Over the years material management has been restricted to routine purchasing stores etc.

An Indian stores department established 1922, was the precursor was thrown into a global system D.G.S. and D (Directorate general of supplies and Disposals). In the corporate sector, TISCO was the first one to establish a central purchase department.

With the liberalization and opening up of the economy, our country was thrown into a global system from it’s the traditionally insular and self-reliant stance. For the Indian corporate world it meant a totally different ball game, from a government-protected system, it found itself in an environment where it had to contend with market forces, a large corporation with significant brand equity and also follows different sources strategies and practices.

Again with the new millennium, things looked extraordinary, exciting as well as daunting. Enabling technologies, especially information technology, have created a whole new realm of virtual reality, which has changed many paradigms of how business is conducted globally.

India also faces the of not only integrating itself with the rest of the world but more importantly, of understanding future global trends to work towards finding a place among the leading economies. This would involve leveraging significant advantages, such as a qualified manpower pool and natural resources to the fullest event. The competitive edge will come from a companies ability to innovate, create and used the entrepreneurial energies of its people.

The atmosphere is ripe for a professional approach towards material function.

Reference Books:

Materials Management, A. K. Datta, 2nd edition, PHI

Material and logistics management, L. C. Jhamb, tenth edition, Everest publishing house

This is all about evolution and history pf material management.