CHAPTER ONE

1.1 Background to the Study

In today’s dynamic business world most supply chain have adopted inventory management technological control system which is a crucial aspect of managing stocks in the organization to boost the performance of the organization. Over the years there has been emergent realization of important contribution of modern technology to produce chains performance. It’s a characteristic of practitioners in most organizations to boasts on its performance to achieve a competitive advantage (Porter, 1998). Performances are often measured against value which suggests meeting the requirements of its customers. Inventory management is about having the correct inventory at the right time, within the right quantity, within the right place and at the right price. It’s very essential to own track of inventory at various stages like when it’s been purchased, at what point is it on transit, when it arrived its destination (warehouse, distribution center, and its customers), what quantity has been sold out and how  much is in stocked (Shetty, 2018). This can effectively and efficiently be achieved with the right inventory management technological control systems.

Inventory management has been, and can still be the unwavering concern for all business. Shopkeepers in the past relied on handwritten notes and basically their gut feeling when it came to keeping control of stock and any orders. This made it extremely difficult to account for what products they had in stock and other issues such as stolen goods and time consumption in taking stock (McCarthy; 2018). While the scale of the operations was smaller than they are today, there was still a push to improve efficiency hence improving on business performance.  In 1889, Herman Hollerith invented the first ever punch card which was readable by machines. This invention permitted people to record data in many ways and for different purposes, from checking in and out of work for employees to a more efficient form of stock control. From Hollerith’s idea, Harvard University was inspired to create the first ever modern check-out system using punch cards in the 1930’s. These punch cards corresponded with catalogued items and were also used for billing as well as to control stock and manage inventory. However this technology did not solve the problem because of it slow lead time which affected the performance of the business at that time and this gave birth to the electronic bar codes (McCarthy; 2018)

Then came first initial barcode which was created around the 1940s and early 50s, however, it did not make its way to the UK properly until the 70s. This barcode was composed of ultraviolet light sensitive ink and reader. However, technology had not quite caught up with these ambitious ideas and the system was just too bulky and needed to harness more computer power than available at this time. Then a better version of the product was developed which slightly caught up with technology (McCarthy; 2018). It now permitted the tracking of stock and allowed for cheaper and faster scans. As we progress into the 80s and 90s, technology developments made tracking and controlling stock even more efficient. The advancement of stock control software and more advanced computer systems made for a big chance. These systems worked in a cycle; from purchasing to tracking and monitoring stock and back again. Stock control software made warehouses and stock control rooms much more streamlined and with the decrease in price – much more common (McCarthy; 2018). By this time, stock control and inventory tracking by hand was replaced by scanning products and then inputting all information into computers by hand. By the early 2000s, the stock control software was even more developed, again with the advancement in technology. Now businesses no longer inputted data by hand, and barcode scanners could instantly update the databases, making stock control and every other task much easier (McCarthy; 2018).

Despite the advancement in technology the organizations still faced challenges with this control system which negatively affected the performance of their organizations. This now led to the development of the Radio Frequency Identification. It was first patented in the 1970s and soon became a great help in factories and warehouses where stock control was vital. It uses a microchip to transmit product information such as a serial number, manufacturer, or type of product, to a scanner. It could be thought of as an advanced type of barcode (McCarthy, 2018).  However so much have been talk on inventory technological control globally and most especially with the advent of COVID 19,  As indicated in the aforementioned background, optimal use of appropriate inventory management technological control systems could provide a solution in addressing the ineffectiveness and inefficiencies experienced in the sector.

Globally most businesses are turning to technology and other automated systems to perform most of their everyday tasks in order for them to increase their organizational performance so as to satisfy their customers and make their business profitable with the aid of the Materials Requirement Planning (MRP), Vendor Managed Inventory (VMI), Radio Frequency Identification (RFID), Enterprise Resource Planning (ERP), Electronic Point of Sale (E-POS), and E- Procurement (Ken et al; 2010; Simchi-Levi et al; 2009 and Sople, 2010). Presently the global world business like Amazon alone is making use of Robotics. As by 2016 Amazon alone had an estimated 30,000 robots in their facilities. Smart, mobile automation which was regarded as the world’s future is now our present – and best of all, it is bringing major changes to factories and warehouses, increasing the potential for United States businesses’ global competitiveness (Mellage et al; 2021)With inventory management software in conjuction with inventory control technology it is easier for organization to access real-time inventory levels and track their orders from the warehouse to their doorstep which brings about an increase in organizational performance. In addition to this it was observed by Yu & Ramanathan, (2008) in UK, and Khaliq & Fawad (2012) in China that firms had adopted technology like RFIDs in their manufacturing sector and supermarkets and it was realized it improved on the effectiveness and efficiency which in turn boost performance in their manufacturing industries.

In Africa, Mongare and Nasidai (2014), Kitheka (2010), and Chelangat, & Bonuke, (2012) ascertained the adoption of inventory management technological control systems in Kenya. It was observed that this technological inventory management control system had bigger impact on inventory control in terms of efficiency, ease of accessing information and accuracy thereby affecting business units performance (in terms of customer service delivery levels and reduce operational costs). In addition, Ogbo et al; (2014), and Nsikan et al; (2014) also saw the adoption of technological inventory management control systems in Nigeria. Organizations making use of these technological control systems have experience a reduction in their operational cost, reduction in lead times and increase in service level. This shows that the implementation of Information Technology (IT) in supply chain management and in particular inventory management holds enormous possibilities to unravel the effectiveness of inventory management in today’s businesses by improving information sharing, increasing predictability, improve monitor of demand for certain products and place orders to prevent stock out thereby reducing lead time (kithinji, 2015) and hence improving business units performance.

In Cameroon, small and meduim size enterprise in the economy play a vital role in enhancing the growth and development of the country. Businesses have been identified as the catlyst for the economic growth of the country as they are a primary source of income and employment in the economy (Mensah, 2012). With the right technological inventory management control system  put in place, they will be able to make more profit bringing about an increase in the employment of it citizens and reducing the rate of poverty. In a developing economy like cameroon, the portion of bussiness activities represented by the retail companies has increased considerbly over the last decade and they play a vital role in achieving sustainable development goals (Appah 2015). Inventory is still an important element in operational effectiveness and often appears in the balance sheets as the biggest of the current assets, holding up a lot of cash with business units in Cameroon. Current stock is very expensive and it is unacceptable in many organizations to hold up excess stock (Adams, 2005). Observations made in Cameroon by Che (2016) stated Small and Meduim size enterprises lack inventory technological systems use in managing inventory which affects the organizational performance. Small Meduim Enterprise (SMEs) needs to invest in managing their inventory as it greatly affects performance. In addition (Ako, 2019) acertain the adoptation of information technology in Cameroon and this technology has had an effect on the performance of an organization. Poor inventory management had become an issue of great concern since performance is regarded as the main stream for development of organizations. This is because poor inventory management systems leds to customer dissatisfaction, stockout, and inaccurate record keeping of inventory.

The aims of inventory reduction and minimization are more easily accomplished with modern inventory technological control systems which are working effectively for the improvement of performance. The work of inventory management is much more complex than initially understood (Mohamad 2016).

 In light of this therefore, the proposed study seeks to examine the effect of inventory technology control systems on organization’s performance with a focus on some Business units in Bamenda, Cameroon.

1.2. Delimitation of the Study

1.2.1 Time Frame

This work covers a period of 2 years and is divided into two phases. The first phaseof the work deals with the course work that covers a period from 2019-2020 Academic year and also the period of internship. The second phase of the work is the dissertation which is made up of two phases. The first phase is linked with pre field work studies and occupies the 2020-2021 academic year. The second phase of the dissertation also occupied 2020-2021 with intense field work until May 2021.

1.2.2 Spatial Delimintation

This is related to the area coverage which in this case is Bamenda 1, 2, & 3. Also the business units in these area include Supermarkets, Filling stations, Brewery distributors, pharmacies, Hardware shops and general Supplies.

1.2.3 Thematic Delimintation

The areas of study for this work were business units in this municipality which included; Supermarkets, Filling stations, Brewery distributors, pharmacies, Hardware shops and general Supplies. Therefore, researching on inventory management technological control systems and its effect on performance of business units is not indispensable but vital for this organization to thrive in the midst of the socio-political crises in Bamenda. Inventory technological control system and organizational performance are the concepts that were reviewed in this study. The Task technology Fit theory and the Tam theory are the main theories reviewed for this study. This study is an academic work and it ran from the period of April to June 2021.

1.3. Statement of the Problem

As organizations strive to improve and sustain competitive advantage in the highly competitive market environment, the management of its inventory through the deployment of inventory management technological control systems is very essential in order to fulfil customers increasing needs. Effective inventory flow management in supply chains is one of the key factors for success. A company would ideally want to have sufficient inventories to satisfy their customers and eliminate issues of lost sales due to inventory stock-outs. On the other hand, the company does not want to have excess inventory staying on hand because of the cost of carrying inventory. Enough but not too much is the ultimate objective.

 It is assumed that most of the Businesses in Bamenda have deployed technological control system to manage their inventories. Despite the adoption for some organizations, most of them have not yet fully adopted and mastered the inventory management technological control systems and are not efficiently making use of them. As a result they have encountered a problem of accountability, traceability and issues of under and over stocking. This problem has greatly affected the overall performance of the organizations in terms of delivery, customer’s satisfaction and the profitability of the organization which is a prime goal for every organization.

Businesses in the Bamenda Municipalities are faced with issues of timeliness, speed and other accuracy which brings about a significant challenge in their organization. In addition, organizations that have not adopted technological inventory control systems in Bamenda municipalities are faced with issues of theft and out stock since they are unable to account for what they have in stock. It is on this basis that the researcher aims at carrying out a research on the effect of inventory technological control systems and organizational performance.

1.4. Research Questions

Against the stated problem, the following research questions have been generated to guide this study.

1.4.1. Main Question

What are the effects of inventory management technological control systems on organizations performance?

1.4.2. Specific Questions

1. What are the effects of inventory management technological control system on organizations operations?
2. What are they inventory management technological control systems used in business in Bamenda?
3. To what extent is the effectiveness of inventory management technological control systems in organizations performance?
4. What are the challenges faced by organizations in implementing inventory management technological control systems?

1.5. Objectives of the Study

The following general and specific objectives have been formulated to guide this study;

1.5.1. Main Objective           

To assess the effects of inventory management technological control systems on organizational performance of business units in Bamenda.

1.5.2. Specific Objectives

The specific objectives of this work are stated as follows;

1. To examine the effects of inventory management technological control systems on the operations of business units in Bamenda.
2. To identify inventory management technological control systems used by business in Bamenda
3. To investigate the effectiveness of inventory management technological control systems on business units in Bamenda.
4. To proffer measures to some of the challenges associated to the use of inventory management technological control systems in the management of organization of business units in Bamenda