OTHM Level 6 Diploma in Logistics and Supply Chain Management Assignment Sample

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Introduction: Logistics and Supply Chain Planning and Control

Supply chain planning is a strategic methodology which, when done appropriately, enables in the improvement of the product production and supply. This can assist in reducing costs of production, augment sales and handle relationships with suppliers. It optimized the production as well as delivery of goods from raw materials to end products, and form vendors to customers. Fundamentally, it is a demand based act of balancing surplus and shortage (Reyes, Mula, and Díaz-Madroñero, 2023). Process of supply chain planning involves element like demand forecasting, inventory management, supply and response planning, sales and operations design, supply chain checking, and demand driven refill. Moreover, supply chain control efforts to centrally link or regulate the shipment, manufacturing and product distribution process. It involves components such as order fulfilment, supplier relationship management, distributions and logistics and performance improvement and monitoring. Both supply chain control and planning are important element of handling flow of services and products form the origin point to consumption point. These procedures play a chief role in confirming the effectiveness and efficiency of supply chain of a business.

This report will examine the role of inventory and also types of inventory within supply chain planning and control in business management. It will further assess the inventory approaches utilised in business. Along with this, the report will explain the concept of master production schedule techniques and activities within supply chain planning and control. Towards the end, it will evaluate the structure of bills of materials as well as their significance in supply chain control and planning within business management.

Sample papers and reference materials support students in understanding assignment structure and strengthening academic skills. We provide help with assignment writing service that supports learning while maintaining originality. The OTHM Level 6 Diploma in Logistics and Supply Chain Management Assignment Sample demonstrates key concepts such as inventory control and supply chain planning, and is intended solely for study and reference purposes.

Main Body: Planning, Control, and Coordination in Logistics Operations

The OTHM Level 6 Diploma in Logistics and Supply Chain Management emphasises a comprehensive understanding of how inventory planning, production scheduling, and material coordination contribute to effective supply chain performance. At this level of study, learners are expected to analyse practical approaches to inventory control, evaluate planning techniques, and understand how structured tools such as master production schedules and bills of materials support operational efficiency within organisations.

A. Role of inventory and types of inventory in supply chain planning and control

Inventory plays a pivotal role in the growth and success of any company, irrespective of its industry or size. Role of inventory in supply chain planning and control covers supervising and controlling the goods flow from production point to the consumption point. Within the learning scope of the OTHM Level 6 Diploma in Logistics and Supply Chain Management, inventory management plays an important role in confirming customer satisfaction and even business operations. Through upholding ideal stock levels, businesses can evade situations of stock out which can result in dissatisfied consumers or lost sales, and at the same time reducing the holding costs related to excess stock.

One of the advantages of proper inventory management is cost savings. Effective inventory management assists in reducing or minimising costs through decreasing carrying costs related to extra stock level (Song, 2021). Holding additional stock ties up capitals which can be better used at any other place. While having inadequate stock can result into production postponements, as well as missed sales opportunities. Searching for and holding to the ideal balance is important for cost improvement. In addition, order fulfilment within the timely manner is chief to keeping the customers satisfied. Appropriate inventory handling confirms that the products are obtainable when the consumers require them, decreasing lead time and the possibility of situations of running out of stock. Happy customers are most probable to become repeat customer as well as brand advocates.

OTHM Level 6 Diploma in Logistics and Supply Chain Management Assignment Sample

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Furthermore, through precisely tracking stock levels and patterns of demand, companies can plan their procurement and production activities in a more effective manner. This results into decreased waste, augmented effectiveness and flawless business operations. When the companies keep a deep check at how much stock they have as well as how many employees they need, it can make their inventory and purchase more stock in a clever way. Moreover, inventory management produces useful and helpful data which can be utilised for predicting, supply chain improvement and demand planning. Precise perceptions allow companies to make decisions that are informed which lines up with preferences of customers and trends in the market. Along with this, product can turn out to be out-dated if they remain not sold for the lengthy periods. Effectual inventory management assists to reduce such risk through confirming that the goods are cycled out prior to becoming obsolete.

Running an effective supply chain needs understanding how to gather and track inventory from beginning to ending (Shokouhifar, Sabbaghi, and Pilevari, 2021). Acquiring knowledge in relation to which stock belong to which group permits a business to improve their business operations and account for each step of the manufacturing process more effectively. There are numerous types of inventory in supply chain planning and control, which are elaborated below:

• Raw materials: Raw materials are elementary building block in order to produce a product envisioned for sale. It is the set of initial pieces requires creating an end product. Materials which required turning the stock into finished items are known as raw materials. For example: cotton which is utilised to produce a shirt within an outlet. These stock items are component parts which are presently in stock, though have not been utilised yet either finished products or work-in-process stock. Regardless of their unfinished position, raw materials could still be of substantial value as well as are important to operations, thus, monitoring them is essential. Numerous industries depend extremely on raw materials stock in order to sustain their service delivery and production. This can further be categorised into direct and indirect raw materials. Direct raw materials are defined as elements which are utilised directly within the final or end product. Such raw materials are simple to enumerate and account for per batch or per unit basis. Indirect raw materials are defined as the elements which are not the share of end products, however are utilised through the process of production. These materials are tougher to recognise and address as these cannot be traced to particular units or batches, but these are necessary for the manufacturing process.
• Work-in-process (WIP): Such type of inventory refers to something within supply chain presently being worked on or made. In other words, inventory which is at present in manufacturing stage, is called working in process stock. In the context of cost, this inventory involves all those raw materials which are yet in manufacturing when the period of accounting gets finished (What Are the 4 Types of Inventory?, 2025). Overall, any raw materials a business uses in the current time in order to produce finished goods are taken into account as work-in-process inventory. WIP stock is particularly common within food and beverage and manufacturing businesses. It can involve indirect and direct raw materials, the noteworthy thing is that the product is not finished and is within work in process.
• Finished goods: These are the most straightforward of all the types of inventory. Any good which is prepared to be sold to consumers or used by customers, is termed as finished goods. These can be made to order (MTO), or made to stock (MTS). Make-to-order is goods which a customer or business order earlier, whereas make-to-stock goods are stored until bought. Principles of demands and supply regulate the type of finished goods to manufacture. For instance, finished goods can be collection of hand-made candles packaged for retail, a handmade leather purse ready to sell online, or an array of custom-print hoodies ready to be shipped.
• Maintenance, report, operations (MRO) inventory: MRO inventory is used by a company in order to conduct corrective and preventive upkeep on an asset or retain daily business activities to run in an efficient way. This type of inventory is necessary for a business to keep its factory operational, it is mainly for business consumption and not obtainable by customers. For instance, within manufacturing, googles and hard hats utilised during the process of production is MRO inventory. Further, within construction, repair equipment for industrial lubricants and heavy machinery are MRO inventory as they uphold project schedules as well as avert downtime (Rashid, and Rasheed, 2023). This type of inventory also involves the consumable supplies which allow a business to offer its services and goods. For example, most offices need remain stocked with paper, pens, cleaning supplies, ink cartridges and more, irrespective of service they offer.

B. Inventory approaches used in business

Depending on the product involved or type of business, an organisation may utilise numerous inventory management approaches. Contemporary approaches of inventory management involve handling and tracking level of stocks in order to confirm that businesses can accomplish demands of customers. Business can make use of numerous approaches of inventory management, which involves:

• Just-in-time (JIT): This approach to inventory management emphasize on augmenting effectiveness and minimising wastage through receiving stock only when required within the process of production. Such method depends on precise demand forecasting as well as close collaborations with vendors in order to confirm delivery of stocks in timely basis. This focuses on ongoing improvement through mitigating extra or additional stock and reducing lead times. Just-in-time inventory management approach provide considerable advantages, like minimised wastage, less stock holding costs, and better flow of cash. Businesses can retort in a swift manner to changes in the market and demands of customers, resulting into amplified competition. Although, this method also represents issues, involving danger of supply chain disturbances and the requirement for exact demands prediction. Any kind of postponement from suppliers can hamper production process, turning it to be important to uphold robust relations with vendors and establish contingency strategies.
• Economic order quantity (EOQ): EOQ framework assists businesses to determine the optimum order quantity for their stock, minimizing the overall inventory costs (Cesarelli, et al. 2021). Such costs involve holding and ordering costs. This approach aids businesses to recognise the highly effectual order size, upholding a balance among the costs of storing and ordering inventory. The chief goal of this inventory management method is to balance the cost related to holding and ordering inventory. This approach is mainly useful for the businesses which need to maintain a balance among upholding sufficient inventory levels in order to fulfil demands of customer and reduce the costs related to holding additional stock. Some of the advantages of this approach is cost effectiveness, decrease in holding costs, reduce situations of stock outs, flawless ordering, and permits for data based decision making. However, it poses some of the challenges as it relies much on assumptions and simplifications. Further, it can be a time-consuming and complicated process, has limited applicability and does not account for seasonal demand.
• Safety stock: Safety stock is a crucial element of inventory management which serve as buffer in order to protect against worries in supply, lead times and demand. It signifies the additional inventory held above the anticipated demand to confirm product accessibility under unexpected situations. Through upholding safety stock, companies can safeguard themselves from unforeseen variations in customer wants or disturbances within supply chain. Such excess inventory serves as a cushion, enabling businesses to fulfil customer requirements promptly and evade stock outs, at the time of peak periods or supply chain disturbances (15 Types of Inventory Management, 2025). However, there are risks which need to considered while handling decisions related to safety stock misinterpreting the lead times’ role, not handling expectations and resulting to higher inventory holding costs.
• Vendor-managed inventory mechanism: Vendor-managed inventory (VMI) approach is a practice of businesses where vendors assume the inventory manager’s role through taking accountability for refilling and tracking inventory of the business. By the help of constant monitoring and real-time data, vendors confirm that the stock level are upheld and restocked on timely basis. Employing such system provides various advantages to the businesses. This makes the inventory handling process flawless through decreasing the load of businesses to track stock levels continuously. This result into augmented order accuracy, decreased situations of stock outs and improved stock holding costs. In addition, such approach encourages robust communication and collaboration among businesses and vendors. Through sharing concurrent perceptions and data, both the parties can line up their strategies of inventory management and take informed decisions in order augment effectiveness through overall supply chain. VMI systems pose several challenges which need careful and thoughtful planning. These challenges involve communication gaps, unanticipated spike in demands, reliance on suppliers, as well as security risks.
• ABC analysis: It is an influential inventory control approach which categorises inventory items on the basis of their significance and value. Through classifying items into A, B and C groups, businesses can give priority to their inventory management determination in an effective way. A-class category of products signifies high demand, high value products which needs careful management and tracking. B-class category items have moderate demand and value, needing a balanced method for inventory management and control. C-class category items are of low-demand and value. Though, these have a very less influence on entire inventory value, it is crucial to handle them effectively in order to reduce holding costs and evade tying up unneeded resources. Benefits of this inventory management approach is effective resource allocation, cost reduction, augmented inventory control, improved decision making, emphasis of profitability and so on (Mat, et al. 2023). These are some probable limitations to this approach which involves complications in categorisation, subjectivity, possibility of neglect of C-class items, and inflexibility.
• Drop shipping: In this type of inventory approach, the supplier supplies or allocates goods straightway to the customers from their warehouse. This allows businesses to complete customer orders through sending products directly from vendors to buyers without any requirement to have corporeal inventory. Such approach mitigates the complication of inventory handling and control, like inventory problems, precise stock country and related risks. Drop shipping offers businesses with cost effectiveness, flexibility and scalability, enabling them to emphasize on their core responsibilities and encourage business diversification. Among the diverse inventory management approach, it is an effective one which evades the costs of storing or holding the stock altogether. Overall, this approach comes up with numerous advantages such as simple and inexpensive setup, simple to scale up, no issues of shortages or overstocking, and great supplier rapports (Guzman, Andres, and Poler, 2022). However, drop shipping inventory management approach also results in possible limitations like less quality control, intense competition, costly shipping costs, and other problems with stock.

C. Concept of master production schedule activities and techniques

A master production schedule (MPS) determines what goods are produced, when they are manufactured, as well as in what numbers or quantities they are produced. It is the overall plan for assessing the manufacturing of finished products, what is required to be manufactured, how much to be produced and when they require to be produced. Such simple schedule can be utilised as a base for further scheduling and planning through the business. It is important because it assists businesses to plan effective manufacture utilising forecasts of expected demand. Further, it can aid in increasing revenue and reducing wastage. MPS procedure covers numerous chief activities which confirm that production agendas or schedules go together as well as resources are utilised in an efficient manner, these activities are as follows:

Demand prediction and capacity planning: Process of MPS begins with demand prediction which involves assessing future demand of customer on the basis of trends in the market, historical information and data and other pertinent factors (Haekal, 2023). This assists companies to determine the anticipate demand patterns and volume for their offerings. Proper demand forecasting will help the business make ideal choices while managing and augmenting business operations. After the demand is predicted, next step is capacity planning. It encompasses of analysing the production capabilities and capacity to know if they are capable of meeting anticipated demand. At this phase, factors like equipment capability, facility restraints and staff availability is considered. The objective is to line up the capacity of production with the expected demand in order to avoid overstraining or under usage of resources.

Material planning and sourcing: At such phase, businesses recognise the raw materials, resource and components needed for production. Material requirement planning (MRP), is an approach used by businesses to assess the elements and materials required for manufacturing, and this method is deeply associated with MPS. Effective material planning confirms timely availability of required material and at the same time reduces inventory costs and the possibility of situations of overstocking or stock outs. Further, other step is procurement, where businesses partner with vendors in order to organise delivery schedules, uphold constant quality standards, and negotiate pricing.

Scheduling, resource distribution and monitoring: It concentrates on developing a thorough production schedule and series of activities in order to confirm even business operations. And resource allocation involves determining optimum allocation of equipment, labour as well as other resources to the particular manufacturing tasks (Oluyisola, et al. 2022). Suring the production process it is very crucial to monitor work progress, confirm compliance with the prepared timeline and, uphold quality standards. The timeline created by master production schedule requires being consistently track growth and needed alternations. Scheduling comprises of assigning tasks to diverse production lines and workstations, taking into account influences such as setup times, dependencies among jobs, and equipment availability.

Numerous techniques are used in MPS model to confirm smooth manufacturing and effective supply chain management within a business. Finite loading is one such technique which includes scheduling or arranging production on the basis of existing capacity. Generally, it allocates works to the work centers on the basis of their accessible capacity as well as the priority of the work orders. This confirms that the structure is not encumbered and that the manufacturing resources are completely used without going beyond their bounds. Moreover, another technique is infinite loading which undertakes that manufacturing materials and component are boundless, and plans production while not taking into account capacity restraints. Normally, it is a technique which allots work order to the work centers while not accounting for availability or capacity. Such techniques are utilised within atmospheres in which there are plentiful resources, and problems associated with capacity are minimum.

Furthermore, another technique used in MPS model is Capacity Requirements Planning (CRP) which determines either a business’s available capacity of production can fulfil its production objectives (Carmody, et al. 2021). CRP first observes the business’s master production schedule and compares it with the accessible capacity in order to confirm that manufacturing could be finished without putting over burden on resources. In addition, priority sequencing is another technique employed in MPS, which specifies the rank or order in which jobs are to done, on the basis of distribution of priorities. For instance, immediate order or products of high demand and priority might be processed through giving high priority within the master production schedule.

Though MPS can assist and improve businesses, it is crucial to be thoughtful of some possible challenges, which involves demand variability, capacity restraints and so no. Precisely forecasting demand is one of the toughest tasks as it can alter as a result of market trends, unforeseen situations or seasonality (Cañas, et al. 2022). Both the production effectiveness as well as customer satisfaction might be influenced by stock outs or overstocking due to imprecise estimates. Moreover, production operations frequently go through issues in context of obtainable resources like raw materials, labour and machinery, which make it tough to fulfil the production goals underscore within the MPS. Such restraints can result into lost deadlines, delays or the requirement to fine-tune the schedule recurrently.

Along with this, disruptions or delays in supplying components or raw material, because of supplier problems, geopolitical influences, or transportation issues, could cast off the MPS, as well as result into manufacturing delays. Also, the efficiency of the MPS depends intensely on concurrent and precise data from numerous departments, like inventory, procurement, sales, etc. Outdates or varying data may result into mistakes within the production timeline or schedule, like uneven priorities or improper stock levels. Immediate changes in the product specification, market circumstances or customer order, which can push producers to consistently adjust their MPS, resulting into inadequacies and increased complication within the process of production.

D. Structure of bills of materials and their importance in supply chain planning and control

A bill of materials is defined as an all-inclusive inventory of the subassemblies, assemblies, raw materials, component, parts, and quantities required to produce a product. In simple words, it is an overall list of each and every items needed to create a product. The concept of bills of materials is a key operational planning element studied within the OTHM Level 6 Diploma in Logistics and Supply Chain Management, as it supports effective production planning, procurement, and inventory control. Bill of materials (BOM) involves instructions for sourcing and utilising the materials. It plays a noteworthy role in production, logistics and in entire supply chain management. BOM offers components list utilised to develop product and the number of element needed. Thus, it helps production planners to confirm that all the needed components are obtainable before production moves forward (Esteso, et al. 2023). Further, within logistics, it utilised by procurement performing re-ordering, through transportation and warehousing for storage planning needs like perishability or size, and shipping to consume involving special packaging.

Moreover, there are several types of bills of materials, in which some are specific to different business sectors. Manufacturing BOM (mBOM) is utilised when business requires showing all the assemblies and parts needs to create a finished good. Parts which need processing before assembling should also be involved within the mBOM. Another type is engineering bills of materials (eBOM) is formed during the stage of designing product and is frequently based on electronic design automation and computer-aided design tools. Additionally, the service BOM is another type which is often formed by engineers during the stage of product designing, it usually involves lists of each and every parts, repair instructions and installations steps, service specialists use while servicing or installing a product onsite at the place of business of customer. Not like other types, sales BOM offers details of an end or finished good prior to its assembly during the stage of sales.

Further, the structure of BOM varies as per the complication involved in the production of product, though it usually involves key elements, like:

• BOM level: This is a unique number showcasing where each and every assembly or part fits in the BOM order. For example, in case of BOM for a car, each main element like doors, engine and more, would be considered a level. Further, they are broken down into materials or components, like crankshaft or pistons which are components of an engine.
• Part number: This is an exclusive number which recognises a component or material, permitting any person included within the process of production in order to recognise it swiftly (Nocera, et al. 2023). Part number can be further intelligent and non-intelligent part number. Intelligent part number involve description of the part, for example, wire can be termed as ‘Wire-021’. While non-intelligent part numbers involve no descriptions. For most of the businesses either numbering method can work.
• Part name: It is also an exclusive identifier for each and every assembly or part. Similar to part number, this assists users to recognise the part immediately.
• Phase: This specifies the lifecycle phase of each component or part, like ‘in design’ or ‘in production’.
• Description: Also exclusive to each component or part, the description offers more details as compared to part number or name. These are valuable and useful in situations when it is essential to distinguish among parts which seem similar.
• Quantity: It signifies the number of each component or parts will be utilised within a sub-assembly or assembly.
• Unit measure: This entitles in what unit of measure each part or component will be used or sourced. Indicating the measure assist to confirm that order is placed of the correct quantities. For components which are complete such as gaskets, the unit of measure is ‘each’ (Jenkins, 2025)
• Procurement type: This designates how each component or part is obtained. Typically, choices involve buying the part, manufacturing it internally or making it produced by subcontractors.
• BOM notes: This notes section provides a chance to involve other information helpful to anyone observing to the bills of materials. This might involve a list of substitute vendors or the specifications which a material must fulfil.

Bills of materials in important in numerous domains associated with supply chain planning and control. A well-structured and clear BOM assists in upholding the suitable stock or inventory levels for manufacturing requirements. This allows the expectancy of demands and confirms fulfilment of timely basis while reducing costs related to logistics. Such approach everts usual inventory problems like overstocking, backorder and stock outs, and also them repel effects, involving production postponements, downtime or lost productivity. In addition, BOM ensures improved cost control or regulation during the process of procurement. Consumers will have knowledge of the parts required for each and every product. Then, they can negotiate prices with vendors and get volume discounts purchasing in large volume (Stalnaker, et al. 2024). Further, when the BOMs are used effectively in procurement, it leads to improved collaboration and communication with buyers and suppliers. If both of these groups have similar accessibility to the in-depth, correct information, it makes it simple to work out specifications of product and take the right decisions as a team.

Along with this, BOM will offer procurement department with very particular information in relation to the feature of each component and product. This confirms that everything is supplied to a particular standard and at the ideal quality. Moreover, BOM augments the raw material procurement process through evading the gathering of additional stock, it permits for an improved description of costs related to equipment, it averts the dangers of stock outs, since this guarantees the availability of the essential raw materials, as well as decreases the mistakes within manufacturing stage through defining each and every processes. Furthermore, bills of materials offer precise instruction to people involve within the procurement, repair and assembly. Through emphasizing on the materials lists and also their quantities, it helps in predicting need of individual part and eventually confirms that orders are as precise as possible (Franceschetto, et al. 2023). A well-thought-out BOM enables communication among different areas such as production, inventory handling. Procurement and more, which confirms all the teams are lined up within their efforts in order to fulfil production objectives.

Conclusion

On the basis of above study and evaluation, it can be concluded that inventory management is chief in supply chain management, which plays an important role within the profitability of businesses and operational competence. The capability to efficiently handle inventories can make the difference among the failure and success of a company. Further, types of inventory in supply chain planning and control involved raw materials, work-in-process, finished goods and maintenance, report and operations inventory. Moreover, inventory management approaches utilized in business involved just-in-time, economic order quantity, safety stock, vendor-managed inventory system, ABC analysis and drop shipping. Further, concept of master production schedule (MPS) included chief activities like demand prediction and planning the capacity, material planning and sourcing, scheduling resource distribution and monitoring. Diverse techniques utilized in MPS involve finite and infinite loading, capacity requirement planning and priority sequencing.

Moreover, structure of bills of materials (BOM) involves key components like BOM level, part number, part name, phase, description, quantity, unit measure, procurement type and BOM notes. BOM of materials is extremely crucial in various areas which are related to supply chain planning and control such as inventory management, procurement and more. Overall, this report has highlighted the role of inventory as well as types of inventory within supply chain planning and control. It has also assessed the inventory approaches utilized in business, and examined the concepts of master production schedule activities and also techniques. Lastly, the report has been completed through analysing the structure of the bills of materials and also its importance in supply chain planning and control has been discussed.

References

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