Material Coding System
As technology evolves, the variety of products and flow rates are also increasing. With each passing day, hundreds of new products are participating in each product group.
The use of material code with reasons of increasing product type, quantity and flow rate should not be called luxury or burden. Classification and coding are inevitable for systematic monitoring of material flow activities. This systematic activity relaxes the functioning (Nikam). Material coding can also be referred to as material identification (RAO).
It will be beneficial for everyone to have a common code base within the organization and sub-details to be left to the projects (eg “drill-to-head” by center, dimensions will be determined by the project).
It would be more appropriate to prepare this code structure not only with the central hand, but also with the vision and experience of all projects. In this way, the teams in the projects can both develop and take ownership willingly by finding a piece from themselves. Employee ownership is a must for success.
The material code structure needs to be prepared manually by the people in the business (buyer, warehouse, orderer, etc.), rather than as a filter list, on the resulting list of IT specialists filtering out the definitions of the previous purchases. It is not only the preparation of the code list, but also the logic by which the breaks of the list are prepared. It will also be very useful to investigate similar samples in the world.
A few of the purposes of material coding (Nikam);
- Sort similar materials under a single group (eg: All Profile’s are listed under the same roof),
- To avoid duplication and confusion,
- Dispense differences of the definitions (multiple names for the same material eg straight iron = coiled iron).
Some features that material codes should have (Nikam);
- It should be simple,
- Must be unique,
- It should be compatible with short, core and other similar materials,
- It should be flexible according to future requirements (eg: specific pipe diameters),
- Codes should be as understandable as possible so that you do not need a booklet.
There are some surplus values to be provided when working with the material code system;
- By avoiding different expressions for the same material from one unit to another, wrong purchases of wrong goods may be prevented,
- Material unit prices can be reached quickly and accurately,
- Purchasing and logistics departments can control themselves much more quickly, easily and accurately,
- The logistics unit can easily group the materials on this side and access the desired information quickly,
- By avoiding duplicate definitions, awareness weakness that may result from stocking the same material in different places can be prevented,
- Classification makes reports more understandable,
- Units that do not have detailed information about material descriptions (Cost control, planning, proposal preparation, etc.) can filter the information they want more easily and quickly,
- The bid preparation unit can reach to the current prices quickly and correctly and also can see periodic price changes easily,
- The price comparison between the project and the projects can be done very easily,
- When talking to people inside and outside the group, you can be sure that you speak the same material,
- Census and classification sweeps may decrease.
Besides, the addition of material photographs to the ERP system will be very helpful for orderers to see what they ordered and for price control to see and know what they control.
In the following, the material code structure arranged in this direction can be seen;
Material code structure example;
Coloring may be useful for distinguishing codes more easily (Nicam).
The codes must be generated via the ComboBox (Down slider) to minimize the errors in the code entries.
Sample material codes according to the above structure;
- Nikam, D. (n.d.). Coding in material management. Retrieved from slideshare.net/: http://www.slideshare.net/dineshnikam180/coding-46939313
- RAO, S. R. (n.d.). Codification in Materials Management. Retrieved from Cite.co: http://www.citeman.com/4466-codification-in-materials-management.htm