ch 10 codification
DESCRIPTION
codeTRANSCRIPT
![Page 1: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/1.jpg)
Chapter 10
Codification, Standardization and Variety Reduction
![Page 2: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/2.jpg)
Classification
The materials procured by a firm must be classified and coded before the materials are inspected, accounted in stores ledgers and binned and hence materials are broadly classified according to their nature, use and service before the job codification is taken up.
![Page 3: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/3.jpg)
Codification
This is the system adopted for accurate identification of materials by allotting a numerical number for each item procured and stored.
![Page 4: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/4.jpg)
Systematic grouping for correct identification of similar items.Avoids duplicate stocks of same itemsReduction in sizes and varietiesHelps in standardization of materialsEnsures accuracy in correspondence, records and postings of receipts and issues in appropriate records
Advantages of Classification and Codification
![Page 5: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/5.jpg)
Principles of Classification and Codification
ConsistencyComprehensivenessMutual exclusivenessSimpleEasily adoptable
![Page 6: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/6.jpg)
Groups of Materials Classification
Raw MaterialsComponentsConsumablesSpare PartsSuppliesToolsPacking MaterialsWork-in-progress itemsFinished Goods
![Page 7: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/7.jpg)
Completely knocked down itemsHard ware itemsFastenersSubcontracted itemsWires and cablesPaints and chemicals
![Page 8: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/8.jpg)
Systems of codification
Alphabetic systemSimple numeric systemAlpha-Numeric SystemBlock SystemDecimal SystemNumeric SystemMnemonic System
![Page 9: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/9.jpg)
Objectives of Codification
To bring all similar items together under one classification or groupTo classify an item according to its nature or characteristicsTo avoid duplication and confusionTo fix essential parameters to specify an item
![Page 10: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/10.jpg)
Steps involved in Codification System
The large number of items of different varieties comprising the inventory needs to be classified under major groups known as “Generic Groups”Further divide into distinct subgroups according to the type of materialFurther listed in alphabetical order and then according to the size.
![Page 11: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/11.jpg)
Codification Systems
The Kodak SystemThe British System
![Page 12: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/12.jpg)
Standardization
It is the process of establishing basic specifications for a set of commonly used characteristics of size, shape and performance for products.
![Page 13: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/13.jpg)
Simplification
It is closely related concept or process which refers to the reduction in the number of different sizes and shapes of items produced or stocked.
![Page 14: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/14.jpg)
Two Areas of Standardization
Industrial StandardizationManagerial Standardization
![Page 15: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/15.jpg)
How Standardization Reduces Costs?
It enables a firm to purchase fewer items, in large quantities and at lower pricesDue to fewer items are processed and stocked reduces purchasing, receiving, inspection and payment costsInventory control becomes easier and less costly because of stocking of fewer items
![Page 16: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/16.jpg)
Objectives of Standardization
To achieve maximum overall economyTo ensure maximum convenience in useTo ensure uniformity and reduction in varietyTo help in quality assurance by improving quality in every activity
![Page 17: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/17.jpg)
Levels of Standards
Individual StandardCompany StandardIndustry StandardNational StandardInternational Standard
![Page 18: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/18.jpg)
Advantages of Standardization
Fewer parts to deal with inventory and in manufacturingSimpler and more routine purchasing, handling and inspection proceduresFacilitates longer production runs and automationHelps in better understanding of customer requirements
![Page 19: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/19.jpg)
Disadvantages of Standardization
Decreased variety of end products results in less consumer appeal and thereby affecting the competitive advantage for the firm. Designs may be frozen with too many imperfections remainingDesign changes involve high costs which will increase resistance to improvements in design
![Page 20: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/20.jpg)
Objectives of Standardization Program
To standardize the materials used in firmTo bring the company standards in line with the industry standardsTo reduce the varieties of raw materials and components usedTo establish the specifications of materials to be purchased
![Page 21: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/21.jpg)
Types of Standards
Product StandardsEngineering StandardsMaterial StandardsQuality StandardsProcess StandardsEquipment StandardsSafety StandardsAdministrative Standards
![Page 22: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/22.jpg)
Simplification
It is defined as the elimination of superfluous varieties, sizes, dimensions, features etc., making the design, assembly or product simpler, less complex and less difficult to use.
![Page 23: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/23.jpg)
Specification
A Specification is a detailed description of a material, component part or a product, including physical measures such as dimensions, volume, weight, surface finish etc.
![Page 24: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/24.jpg)
Specification Types
Dimensional and Material SpecificationsPerformance Specifications
![Page 25: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/25.jpg)
Kinds and Sources of Industrial Standards
International StandardsIndustry or National StandardsCompany Standards
![Page 26: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/26.jpg)
Variety Reduction
The process of standardization logically leads to simplification and variety reduction. Variety reduction defined as a form of standardization consisting of the reduction of the number of types of products, or materials or parts within a definite range to a lesser number which is adequate to meet prevailing needs at a given time.
![Page 27: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/27.jpg)
How to control Variety?
By SimplificationsBy StandardizationBy Specialization
![Page 28: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/28.jpg)
Value Analysis
This is another approach to variety control and thereby cost reduction
![Page 29: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/29.jpg)
Benefits of Variety Control
Better after sales serviceGreater technical productivityBetter understanding of technical problemsLesser set up timesHigher equipment utilization
![Page 30: Ch 10 Codification](https://reader031.vdocuments.us/reader031/viewer/2022011720/563dbab4550346aa9aa75a6a/html5/thumbnails/30.jpg)
Reduction in inventoryHigher equipment utilizationEasier inventory controlBetter use of storage spaceQuicker stock-checkingReduction in purchasing effort