WAREHOUSE OPERATIONS MANAGEMENT AND SAFETY WORKSHOP $2024$

CASE STUDY

SHF Investment is a major provider of oil and gas products in Ghana. SHF was originally

established to exploit quickly gas found in Katakumadu oil fields. SHF has grown rapidly since its

establishment in $1998$ and has a turnover of GHe$2\mathrm{.}2$ billion.

During the period of their existence, significant amount of money had been invested in building

up its infrastructure and holding of various types of stocks to avoid any hold$-$ups when drilling for

oil and gas.

Recently SHF has seen profits fall as gas and oil yields begin to fall. These falling yields have led

to its Board of Directors and Management, reappraising the situation. After a six$-$month strategic

appraisal exercise, it has come to light that substantial savings could be made in a lot of areas. The

major areas of concern that impact on stores are the following:

The amount of stock held needs to be reduced significantly but service levels must remain

satisfactory.

It is felt that previous contracting practices need radical changes, particularly those

involving spare parts policy. Historically, all suppliers were asked to nominate list of spare

parts SHF should hold 'Just in Case'. All suppliers provided extensive lists of such spare

parts, with their own unique part numbers. Stores executives have found exactly the same

item stored under several different part numbers. It is estimated that this is costing SHF

$30\%$ extra on stocks held. Suppliers, however, are reluctant to specify generic parts.

The stores and the stockyards are running $50\%$ capacity. There have been suggestions from

various consultants that such stores facilities could be shared with other players in the

industry to reduce cost.

Use of space in the stores is generally poor and needs greater attention to both accessibility

and better use of space.

There appear to be a large amount of obsolete and redundant stock held

Finally there have been general comments on low staff moral and poor housekeeping

TASK

As a newly appointed Stores and Inventory Manager, produce a report addressing the

identified concerns in the case study. Suggest solutions which, if implemented could lead to

improvement in your area.