inventory Control


Stevenson, W.J. (2009). Operations management (10th ed). New York : McGraw Hill/Irwin

Read the case study below ?Harvey Industries?. Provide reasoning for the current financial distress of the company and make recommendations for improvements to the new company president. Include at least one specific recommendation for both Supply Chain Management (chapter 5) and Inventory Management (Chapter 6), as well as any other recommendations you deem necessary from your reading. Provide your recommendations in a 2-4 page APA style paper.

Harvey Industries

Background

Harvey Industries, a Wisconsin company, specializes in the assembly of high-pressure washer systems and in the sale of repair parts for these systems. The products range from small portable high-pressure washers to large industrial installations for snow removal from vehicles stored outdoors during the winter months. Typical uses for high-pressure water cleaning include:

Automobiles


Airplanes

Building maintenance


Barns

Engines


Ice cream plants

Lift trucks


Machinery

Swimming pools




Industrial customers include General Motors, Ford, Chrysler, Delta Airlines, United Parcel Service, and Shell Oil Company.

Although the industrial applications are a significant part of its sale, Harvey Industries is primarily an assembler of equipment for coin operated self-service car wash systems. The typical car wash is of concrete block construction with an equipment room in the center, flanked on either side by a number of bays. The cars are driven into the bays where the owner can wash and wax the car, utilizing high-pressure hot water and liquid wax. A dollar bill changer is available to provide change for the use of the equipment and the purchase of various products from dispensers. The products include towels, tire cleaner, and upholstery cleaner.

In recent years Harvey Industries has been in financial difficulty. The company has lost money for three of the last four years, with the last year?s loss being $17,174 on sales of $1,238,674. Inventory levels have been steadily increasing to their present levels of $124,324.

The company employs 23 people with the management team consisting of the following key employees: president, sales manager, manufacturing manager, controller, and purchasing manager. The abbreviated organization chart reflects the reporting relationship of the key employees and the three individuals who report directly to the manufacturing manager.

Current Inventory Control System

The current inventory control ?system? consists of orders for stock replenishment being made by the stockroom foreman, the purchasing manager, or the manufacturing manager whenever one of them notices that the inventory is low. An order for replenishment of inventory is also placed whenever someone (either a customer or an employee in the assembly area) wants an item and it is not in stock.

Some inventory is needed for the assembly of the high-pressure equipment for the car wash and industrial applications. There are current and accurate bills of material for these assemblies. The material needs to support the assembly schedule are generally known well in advance of the build schedule.

The majority of inventory transactions are for repair parts and for supplies used by the car washes, such as paper towels, detergent, and wax concentrate. Because of the constant and rugged use of the car wash equipment, there is a steady demand for the various repair parts.

The stockroom is well organized, with parts stored in locations according to each vendor. The number of vendors is relatively limited, with each vendor generally supplying many different parts. For example, the repair parts from Allen Bradley, a manufacturer of electrical motors, are stocked in the same location. These repair parts will be used to provide service for the many electrical motors that are part of the high-pressure pump and motor assembly used by all of the car washes.

Because of the heavy sales volume of repair parts, there are generally two employees working in the stockroom- a stockroom foreman who reports to the manufacturing manager and an assistant to the foreman. One of these two employees will handle customer orders. Many customers stop by and order the parts and supplies they need. Telephone orders are also received and are shipped by United Parcel Service the same day.

The assembly area has some inventory stored on the shop floor. This inventory consists of low-value items that are used every day, such as nuts, bolts, screws, and washers. These purchased items do not amount to very much dollar volume throughout the year. Unfortunately, oftentimes the assembly area is out of one of these basic items and this causes a significant amount of downtime for the assembly lines.

Paperwork is kept to a minimum. A sales slip listing the part numbers and quantities sold to a customer is generally made out for each sale. If the assembly department needs items that are not stocked on the assembly floor, someone from that department will enter the stockroom and withdraw the necessary material. There is no paperwork made out for the items needed on the assembly floor.

There were 973 different part numbers purchased for stock last year and those purchases amounted to $314,673. An analysis of inventory records shows that $220,684 was spent on just 179 of the part numbers.

Fortunately for Harvey Industries, most of the items they purchase are stocked by either the manufacturer or by a wholesaler. When it is discovered that the company is out of stock on an item, it generally takes only two or three days to replenish the stock.

Due to the company?s recent losses, its auditing firm became concerned about the company?s ability to continue in business. Recently the company sold off excess vacant land adjoining its manufacturing facility to generate cash to meet its financial obligations.

New President

Because of the recent death of the owner, the trust department of a Milwaukee Bank (as trustee for the estate) has taken over the company?s affairs and has appointed a new company president. The new president has identified many problem areas- one of which is improper inventory control. He has retained you as a consultant to make specific recommendations concerning a revised inventory control system. What are your recommendations and rationale?

Inventory Control

Read the case study below ?Harvey Industries?. Provide reasoning for the current financial distress of the company and make recommendations for improvements to the new company president. Include at least one specific recommendation for both Supply Chain Management (chapter 15) and Inventory Management (chapter 13), as well as any other recommendations you deem necessary from your reading. Provide your recommendations in a 2-4 page APA style paper.
Stevenson, W.J. (2011). Operations Management (11th Ed). New York, NY: McGraw Hill/Irwin.

Harvey Industries

Background

Harvey Industries, a Wisconsin company, specializes in the assembly of high-pressure washer systems and in the sale of repair parts for these systems. The products range from small portable high-pressure washers to large industrial installations for snow removal from vehicles stored outdoors during the winter months. Typical uses for high-pressure water cleaning include:
Automobiles Airplanes
Building maintenance Barns
Engines Ice cream plants
Lift trucks Machinery
Swimming pools

Industrial customers include General Motors, Ford, Chrysler, Delta Airlines, United Parcel Service, and Shell Oil Company.

Although the industrial applications are a significant part of its sale, Harvey Industries is primarily an assembler of equipment for coin operated self-service car wash systems. The typical car wash is of concrete block construction with an equipment room in the center, flanked on either side by a number of bays. The cars are driven into the bays where the owner can wash and wax the car, utilizing high-pressure hot water and liquid wax. A dollar bill changer is available to provide change for the use of the equipment and the purchase of various products from dispensers. The products include towels, tire cleaner, and upholstery cleaner.

In recent years Harvey Industries has been in financial difficulty. The company has lost money for three of the last four years, with the last year?s loss being $17,174 on sales of $1,238,674. Inventory levels have been steadily increasing to their present levels of $124,324.

The company employs 23 people with the management team consisting of the following key employees: president, sales manager, manufacturing manager, controller, and purchasing manager. The abbreviated organization chart reflects the reporting relationship of the key employees and the three individuals who report directly to the manufacturing manager.

Current Inventory Control System

The current inventory control ?system? consists of orders for stock replenishment being made by the stockroom foreman, the purchasing manager, or the manufacturing manager whenever one of them notices that the inventory is low. An order for replenishment of inventory is also placed whenever someone (either a customer or an employee in the assembly area) wants an item and it is not in stock.

Some inventory is needed for the assembly of the high-pressure equipment for the car wash and industrial applications. There are current and accurate bills of material for these assemblies. The material needs to support the assembly schedule are generally known well in advance of the build schedule.

The majority of inventory transactions are for repair parts and for supplies used by the car washes, such as paper towels, detergent, and wax concentrate. Because of the constant and rugged use of the car wash equipment, there is a steady demand for the various repair parts.

The stockroom is well organized, with parts stored in locations according to each vendor. The number of vendors is relatively limited, with each vendor generally supplying many different parts. For example, the repair parts from Allen Bradley, a manufacturer of electrical motors, are stocked in the same location. These repair parts will be used to provide service for the many electrical motors that are part of the high-pressure pump and motor assembly used by all of the car washes.

Because of the heavy sales volume of repair parts, there are generally two employees working in the stockroom- a stockroom foreman who reports to the manufacturing manager and an assistant to the foreman. One of these two employees will handle customer orders. Many customers stop by and order the parts and supplies they need. Telephone orders are also received and are shipped by United Parcel Service the same day.

The assembly area has some inventory stored on the shop floor. This inventory consists of low-value items that are used every day, such as nuts, bolts, screws, and washers. These purchased items do not amount to very much dollar volume throughout the year. Unfortunately, oftentimes the assembly area is out of one of these basic items and this causes a significant amount of downtime for the assembly lines.

Paperwork is kept to a minimum. A sales slip listing the part numbers and quantities sold to a customer is generally made out for each sale. If the assembly department needs items that are not stocked on the assembly floor, someone from that department will enter the stockroom and withdraw the necessary material. There is no paperwork made out for the items needed on the assembly floor.

There were 973 different part numbers purchased for stock last year and those purchases amounted to $314,673. An analysis of inventory records shows that $220,684 was spent on just 179 of the part numbers.

Fortunately for Harvey Industries, most of the items they purchase are stocked by either the manufacturer or by a wholesaler. When it is discovered that the company is out of stock on an item, it generally takes only two or three days to replenish the stock.

Due to the company?s recent losses, its auditing firm became concerned about the company?s ability to continue in business. Recently the company sold off excess vacant land adjoining its manufacturing facility to generate cash to meet its financial obligations.

New President

Because of the recent death of the owner, the trust department of a Milwaukee Bank (as trustee for the estate) has taken over the company?s affairs and has appointed a new company president. The new president has identified many problem areas- one of which is improper inventory control. He has retained you as a consultant to make specific recommendations concerning a revised inventory control system. What are your recommendations and rationale?

Focus of the Final Project
Submit a paper on one of the major topics listed below:

IRR v. MIRR Valuation Methods
Use of Real Options Theory in Financial Management/Modeling
Debate the Theories of Accounting for Stock Options
Use of Derivatives in Risk Management
Use of SCM as a Method of Inventory Control
The paper must (a) identify the main issues in the chosen area, (b) new learning that has occurred, (c) class activities or incidents that facilitated learning and understanding, and (d) specific current and/or future applications and relevance to the workplace. The emphasis of the paper should be on application of new learning.

Writing the Final Project Paper
The Paper:
Must be eight double-spaced pages in length and formatted according to APA style as outlined in the approved APA style guide. Title, reference, and any exhibits or appendices are not counted in the paper length.

Must include an introductory paragraph with a succinct thesis statement.
Must address the topic of the paper with critical thought.
If possible, provide a context of a first-person experience where you saw this academic concept in operation. Do not simulate third-party statements of experience.
Readdress the concept and the experience with critical thought. That is, what is your response to the content, either positive or negative, and then defend your position. If multiple options/alternatives/positions are present and are being rejected you must also defend the reasons for rejecting an option.
Must conclude with a restatement of the thesis and a conclusion paragraph.
Must use APA style as outlined in the approved APA style guide to document all sources.
Must include, on the final page, a Reference List that is completed according to APA style as outlined in the approved APA style guide.

1) Visit APICS: The Association for Operations Management (previously known as the American Production and Inventory Control Society) at http://www.apics.org and list two upcoming educational events or programs that would be appropriate for students.

2) Visit Inventory Management at www.inventorymanagement.com and list the services it provides to businesses.

3)Visit the McCadam Cheese Plant at http://www.mccadam.coop/tour.php and answer the following questions:


1.) What type of production process is this (process focus, repetitive focus, mass customization, or product focus)?


2.) Given the process, what quantity of inventory do you expect McCadam to have?


3.) Do the photos and descriptions support your conclusions about the quantity of inventory?

According to the Purchasing & Procurement Center (2013),?inventory management starts and ends with supply chain management because many of the opportunities to improve efficiencies start with shortening order to receipt time without incurring additional cost.? This statement sounds clear but to a person who has limited knowledge of the supply chain management could be overwhelming and confusing. What Purchasing & Procurement states is a company must be able to go from step 1 to 4, Supply Chain Management, Inventory Control, Demand Forecasting, and Reverse Logistics, easily and quickly before profits and sales are lost by lack of demand. However, if a company overbuys transmissions to dismantle and sell the cores; internal and external pieces of the transmissions, but the market for one of their largest selling inventory line becomes oversaturated in the marketplace the product is no longer worth more than scrap prices. The market fluctuates continuously throughout the year because of many reasons one being the weather. For example, if the winter we have experienced these past two years continues, older model automotive vehicles will break down less. Thus causing an overstock of transmission parts along with engine parts such as; heads, crankshafts, alternators, starters, rods and pistons. The sales vary upon which parts are in demand because of popularity or known lifespan of certain parts for the automotive industry.

Also, the 3 objectives of the paper include: Inventory Management in the Automotive used parts industry, better efficiency for inventory control, the supply chain management, and the demand forecasting.

In the paper, I need to show firsthand knowledge of the automotive parts industry, how the markets, weather, production, and quality control can make a difference in the sales and inventory management of these parts. The automotive small parts industry is a worldwide market which will show how other countries purchase and use (Venezuela and Mexico) the small parts to sell in their countries.

how is it controlled?
strategies used?

type of inventory ?
anything regarding inventory control
it is preferred to have academic journals, case studies, reliable and experts reports as recourses for this paper.

BACKGROUND INFORMATION:

Required Readings
Almyta Systems (2009) Overview of inventory control. Retrieved Feb. 21, 2009, from http://systems.almyta.com/Inventory_1.asp and http://systems.almyta.com/Inventory_2.asp

VICS (N.D.) Overview of Collaborative Planning, Forecasting & Replenishment (CPFR). Retrieved Feb. 21, 2009, from http://www.vics.org/committees/cpfr#f1

Murphy, J. (2002) Enabling its field sales managers to collaborate on forecasts allowed Coca-Cola Bottling Co. Consolidated to slash inventories in half while absorbing 150 new products. Global Logistics & Supply Chain Strategies ??" November. Retrieved Nov. 8, 2010, from http://www.glscs.com/archives/11.02.coke.htm?adcode=5



Optional Readings
Intermec, Inc. (2/13/2008). Intermec Increases Accuracy In Ordering And Inventory Control At Canadian Dry Storage. Field Technologies Online. Retrieved Feb. 21, 2009, from http://www.fieldtechnologiesonline.com/article.mvc/Intermec-Increases-Accuracy-In-Ordering-And-I-0002

IBM (2011) Inventory management IT solution from IBM and SAP. Retrieved Feb. 21, 2009, from http://www-03.ibm.com/solutions/sap/doc/content/solution/1497722130.html



Supplemental Resources
Additional supplemental and background information may be found here, as well as some generic resources that may be of value to you all through the course.


INFORMATION REQUIRED TO COMPLETE THE PAPER:

Supply chain management is the careful attention paid to the process that sees materials, information, and finances move from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management focuses on efficiently and effectively coordinating the flows of the supply chain process both within and between companies. Often, the main goal of supply chain management is to reduce inventory thus resulting in better efficiency and reduced costs. Here are a couple of general descriptions of the inventory control problem:

Almyta Systems (2009) Overview of inventory control. Retrieved Feb. 21, 2009, from http://systems.almyta.com/Inventory_1.asp and http://systems.almyta.com/Inventory_2.asp

Since 1986, the Voluntary Interindustry Commerce Solutions Association (VICS) has worked to improve the efficiency and effectiveness of the entire supply chain...VICS is made up of companies who have proven that a timely and accurate flow of product and information between trading partners significantly improves their competitive position. It has been demonstrated that cross-industry commerce standards facilitate better customer service while reducing costs. VICS' participation with hundreds of small and large companies, has established that the implementation of VICS' business processes and standards achieve excellent returns that go far beyond initial expectations."

The VICS Collaborative Planning, Forecasting & Replenishment (CPFR) Committee has had as its mission:

"... to develop business guidelines and roadmaps for various collaborative scenarios, which include upstream suppliers, suppliers of finished goods and retailers, which integrate demand and supply planning and execution."

You can read a summary of their work here:

VICS (N.D.) Overview of Collaborative Planning, Forecasting & Replenishment (CPFR). Retrieved Feb. 21, 2009, from http://www.vics.org/committees/cpfr#f1

Now lets consider a real-world description of an application of forecasting to inventory control:

Murphy, J. (2002) Enabling its field sales managers to collaborate on forecasts allowed Coca-Cola Bottling Co. Consolidated to slash inventories in half while absorbing 150 new products. Global Logistics & Supply Chain Strategies ??" November. Retrieved Nov. 8, 2010, from http://www.glscs.com/archives/11.02.coke.htm?adcode=5

When you've had a chance to read these articles and to review other information from the background and other sources you may come across, please prepare a 3-4 page paper on the topic:

"True or false: Coca-Cola's experience with inventory forecasting supports the principles set forth by CPFR"

If so, how? If not, why not? Be sure to take a clear stand.



CASE EXPECTATIONS:

Your paper should be between three and five pages. Take a definite stand on the issues, and develop your supporting argument carefully. Using material from the background information and any other sources you can find to support specific points in your argument is highly recommended; try to avoid making assertions for which you can find no support other than your own opinion.

You will be particularly assessed on:


Precision: Your draw on a range of sources, and to establish your understanding of the historical context of the question. You carried out the exercise as assigned, or carefully explained the limitations that might have prevented your completing some parts (running out of time isnt generally considered an adequate limitation).

Support for assertions: You use examples, citations (especially to the required readings), and elaboration to support assertions. You provide evidence that you have read the required background materials.

Clarity: Your answers are clear and show your good understanding of the topic. You see what the module is all about and to structure your paper accordingly.

Breadth and Depth: The scope covered in your paper is directly related to the questions of the assignment and the learning objectives of the module.

Critical thinking: The paper incorporates YOUR reactions, examples, and applications of the material to business that illustrate your reflective judgment and good understanding of the concepts. It is important to read the "required readings" posted in the background material plus others you find relevant. Your informed commentary and analysis is vital -- simply repeating what your sources say does not constitute an adequate paper.

Overall quality: Your paper is well written and the references, where needed, are properly cited and listed (refer to the TUI guidelines (http://www.tuiu.edu/guidelines/Well-Written-Paper.pdf) if you are uncertain about formats or other issues.

Read the article below concerning connecting the factory floor to the intranet/internet. This seems to be an effective way to manage an organization's inventory.

Alexander, M., (2001). Factory Floors Go Online -- Pioneering manufacturers close the final gap in their supply chains. InternetWeek, Manhasset.

After you have read the article answer the question below.

When it comes to inventory control how will putting its factory floor on-line benefit an organization?

Be sure to explain the benefits. Focus on inventory and other logistical factors. Use at least 4 different sources of information.

Additional references:

This article discusses effectively managing inventory in the supply chain for the auto industry.

Gould, L. S. (2002, Aug). Effectively managing inventory in the supply chain. Automotive Design & Production; Cincinnati, 114(8), 70-73.

Here is an excellent article on Just In Time (JIT) inventory management.

Steele, A. L. (2001). Cost drivers and other management issues in the JIT supply chain environment. Production and Inventory Management Journal. Alexandria, 42(2), 61-68.

This article discusses how important it is for organizations to have good relationships with their suppliers.

Drickhamer, D. (2001, May 21). Peak performance. Industry Week. Cleveland, 250(8) 36-40.

This article discusses the importance of speed in the internet economy.

Rubin, D. (2001, Jun.). Velocity management rush. IIE Solutions. Norcross, 33(6), 36-40.

I would like this writer "bolavens" if possible, to provide two short answers (2-3 paragraphs each) to the following Operations Management questions:

1)Why are there waiting lines? What are the characteristics of waiting lines and
how do we manage them? How do restaurants handle these? Can excess capacity be
bad? Why or why not? How do we define and measure capacity?

2)Explain the statement: Inventories are non-earning assets? What are the
objectives of inventory control? What are the requirements for effective inventory
management?

Things that are running smoothly should not be subject to any control. If you commit yourself to just finding and fixing problems, you'll be able to carry out effective control (within an organization) with fewer personnel? (Minoura, 2003).

Discuss what the above statement means and whether you agree with it. Describe how an organization that you have experience of, or have researched, has benefitted from just-in-time (JIT) techniques and with special reference to inventory control. Also discuss whether the potential benefits?and drawbacks?of such JIT techniques are limited to large manufacturing businesses or whether they have wider applications for other organizations.

SPECIAL INSTRUCTIONS
PLEASE USE WRITER SERBA OR BOLAVENS OR ANY WRITER AT THE SAME LEVEL, DO NOT USE WRITER DOTTIESUE.
PLEASE USE ONLY ORIGINAL WORDS. DO NOT USE DIRECT QUOTES FROM ANY OF THE REFERENCES OR ANY INTERNET WEBSITES. MAKE THE ESSAY ORIGINAL AS PROMISED.

BACKGROUND INFORMATION:

Required Readings
Almyta Systems (2009) Overview of inventory control. Retrieved Feb. 21, 2009, from http://systems.almyta.com/Inventory_1.asp and http://systems.almyta.com/Inventory_2.asp

VICS (N.D.) Overview of Collaborative Planning, Forecasting & Replenishment (CPFR). Retrieved Feb. 21, 2009, from http://www.vics.org/committees/cpfr#f1

Murphy, J. (2002) Enabling its field sales managers to collaborate on forecasts allowed Coca-Cola Bottling Co. Consolidated to slash inventories in half while absorbing 150 new products. Global Logistics & Supply Chain Strategies ??" November. Retrieved Nov. 8, 2010, from http://www.glscs.com/archives/11.02.coke.htm?adcode=5



Optional Readings
Intermec, Inc. (2/13/2008). Intermec Increases Accuracy In Ordering And Inventory Control At Canadian Dry Storage. Field Technologies Online. Retrieved Feb. 21, 2009, from http://www.fieldtechnologiesonline.com/article.mvc/Intermec-Increases-Accuracy-In-Ordering-And-I-0002

IBM (2011) Inventory management IT solution from IBM and SAP. Retrieved Feb. 21, 2009, from http://www-03.ibm.com/solutions/sap/doc/content/solution/1497722130.html



Supplemental Resources
Additional supplemental and background information may be found here, as well as some generic resources that may be of value to you all through the course.


INFORMATION REQUIRED TO COMPLETE THE PAPER:

You'll remember that we're using a common basic format for the Project assignments in all Modules -- that is, simulations. Simulation Dynamics, Inc. is a vendor of simulation tools in a variety of problem areas, including transportation. For Insight Network Logistics (INL), they developed VinLogic, a program to forecast transportation network performance for delivery of new automobiles from plants to dealers. VinLogic is a repeated-use model on its sixth year of ongoing use at INL.

For this module, you are going to review a video prepared by the company illustrating the use of VinLogic. Go to http://www.simulationdynamics.com/apps_transportation.asp to review it.

After you have reviewed the various sections of the video, in a short (2-3 page) paper please address the following issues:

Briefly describe what you learned about operations management, in particular transportation and delivery, from your review of the simulation model.

Briefly describe any ideas that occur to you as a result of thinking about the simulation in relation to the module topic and readings.

What do you think of computer-based simulations in general, both pros and cons? Of this model in particular?

SLP ASSIGNMENT EXPECTATIONS:
Your paper should be two to three pages in length, and reflect your personal experiences with this issue. The important part of all these project assignments is to carefully assess your own experiences with the topic, and then reflect critically on what you might have learned about yourself and about situations through this assessment process.

The more that you can use the exercise to develop personal implications for your growth as a potential business person as well as a moral individual, the more value you'll get out of the exercise.

Your paper will be evaluated on the following criteria:

Precision: You carried out the exercise as assigned, or carefully explained the limitations that might have prevented your completing some parts (running out of time isnt generally considered an adequate limitation).

Clarity: Your answers are clear and show your good understanding of the topic.

Breadth and Depth: The scope covered in your paper is directly related to the questions of the assignment and the learning objectives of the module.

Critical thinking: The paper incorporates YOUR reactions, examples, and applications of the material to business that illustrate your reflective judgment and good understanding of the concepts.

Overall quality: Your paper is well written and the references, where needed, are properly cited and listed (refer to the TUI guidelines (http://www.tuiu.edu/guidelines/Well-Written-Paper.pdf) if you are uncertain about formats or other issues.

please label mod 1 opm 500

Inventory Control at Wheeled Coach Ambulance

Firms like Wheeled Coach spend over half of their sales revenue on purchases. These purchases are often in inventory and represent a huge portion of Wheeled Coach?s assets. But, perhaps even more importantly, the ambulances cannot be built if the proper inventory is not on hand when needed.

Two important inventory management techniques are ABC analysis and Cycle Counting. Wheeled Coach uses both. But effective inventory management begins at the design stage. Efficient inventory control requires knowing what is needed. Bills-of-material (BOM) provide this knowledge. Therefore Wheeled Coach spends substantial time and effort making sure the BOMs are correct. Only then does it know what to purchase and have available for the production process.

ABC analysis helps firms develop policies and procedures for controlling inventory. ?A? items are the expensive items such as the chassis (usually purchased from Ford), aluminum (from Reynolds Metal), and plywood used for flooring and cabinetry (from local suppliers). These few items constitute the majority of the inventory values at Wheeled Coach. They are tightly controlled, from purchase to use, with effective security. Orders are negotiated to maximize quantity discounts while minimizing on-hand quantities. Some items, such as aluminum, must be ordered as much as eight months in advance. ?B? items are less expensive and controlled less tightly. Finally, ?C? items have less control, but all items are stored under lock and key and only removed from a secure area if they are on a BOM.

Part of the control of inventory items at Wheeled Coach is cycle counting. Under cycle counting, ?A? items are counted on a very short cycle, perhaps once a month to verify transaction accuracy. ?B? items are counted less frequently, perhaps every two months. And ?C? items are verified once a quarter or even less frequently. Cycle counting provides a much more effective auditing procedure than periodic (annual) counts of inventory.

Only by driving down purchase costs and maintaining tight control of inventory can Wheeled Coach control its total costs. With 45 competitors and orders that are usually won only after a bidding process, Wheeled Coach has no alternative to effective inventory management.

Please turn in a paper of three to four pages (page counting does not include cover and reference list) discussing the following questions:

1. Explain how Wheeled Coach implements ABC analysis.

2. If you were to take over as inventory control manager at Wheeled Coach, what additional policies and techniques would you initiate to ensure accurate inventory records?

3. How would you go about implementing these suggestions?

Case Assignment Expectations:

Research the topic with information from the background readings as well as any other resources you find on your own. The paper should be 3-4 pages in length and have a cover sheet and a reference page. Clarity of presentation is important, as well as your ability to answer the questions in a succinct, organized manner with research to back up your points. Use at least 3 different sources of information and annotate your sources of information appropriately on your references page and within the text as necessary. You will be assessed on how well you apply the ABC inventory system to a real world company and discuss it in detail. Submit your assignment

Purpose: The purpose of this paper is to present two examples based on real life experiences where the Bullwhip effect (BWE) in supply chain is considerably reduced. Both examples relate to the consumer durables industry in India.
Design/methodology/approach: The first example uses enterprise resource planning and vendor managed inventory as tools to reduce the BWE. The second example uses a modification of the classical inventory control policies to eliminate BWE.
Research limitations/implications: This paper could initiate research in an area which would help supply chain researchers and managers to understand why some companies are able to contain BWE and others are not.
Findings: Based on these two empirical case studies, the paper argues that managing BWE is a strategic initiative by organization and the best approach is a combination of several tactical initiatives.
Originality/value: This paper briefly summarizes the managerial approaches to tame BWE in two different contexts. The two examples have some similarities, differences and offer unique insights related to managing BWE.
Keywords:India, Supply chain management, Demand management, Consumer durables
Then in a 3-4 page paper discussing this question. Be sure to use additional articles and resources to support your arguments.
Is VMI a valid method for reducing the BWE? How does it compare to other inventory management methods for reducing the BWE? What conclusions can you draw?

Please focus paper using the below highlighted remarks,


. In general, BWE is the effect of poor management of forecasts, production, and inventories at multiple levels within the supply chain. The effect is often overstocks of products at multiple levels based on poor information flow, improper forecasting, and the use of safety stocks to cover unknown demands. VMI might aid in alleviating the bullwhip effect in part through its focus on real time, accurate flows of information. VMI will not help alleviate the BWE just because the vendor is placing the orders and monitoring the stock.

You offer some good insights into ERP systems but an ERP system is not an inventory management method. Unfortunately, an ERP system will not automatically control inventory nor will it ensure that the right inventory is available when it is needed. If that were true then all companies with ERP systems would be celebrating. What an ERP system does it provide a framework in which to organize and standardize business processes needed to run the business. The intent is to provide real time information with which to run the business. This capability is dependent on how well the system is set up.

Any inventory management technique is dependent upon many factors including the systems used, how well the systems were set up and integrated, the type of training provided, and how accurate the forecasts are. EOQ is a lot sizing technique that is only applicable to certain types of parts. It would be very unusual for a company to use it for every part they sell. EOQ by itself will not eliminate or reduce the BWE.

Use "legal reasoning" to analyze this fact pattern: Review the Outline module attached before writing the essay. Precise Engineering Corporation has a contract with Quik Mart Stores to provide customized software for Quik's inventory control system. Retail Outlets, Inc, Quik's competitor, induces Sam, a Precise subcontractor who is writing code for the Quik software, to delay delivery of the code for one week. As a result, Precise's delivery of the software is delayed, and Quik sustains $500,000 in lost profits. Please use the FIRAC format described in the "Outline" module attached.

Due Date March 1st, 2 pm. 5 pages.
Case study has been faxed to 213-291-2157.
Please confirm upon receival.
This is a Supply and Logistics case study, with the focus on "Manufacturing and Logistics".
This is a final case study where we should apply all principles learned in class, Please inculde only what applies in this case. Here is a comprehensive list:

JIT ( JUST-In-Time),Lead time, Material Requirment planning (MRP),Production Planning and Control, Total Cost of ownership, Bill of Material, Forecasing ( All that allows to see future prodcution requirements)
Economic Order Quantity
Saftey Stock
Linking Fucnitons( Purchasing, Transportation, Warehousing, Inventory control, Distribution
Flow of information
Strategy Managment, Pull vs Push
Waste Managment
Outsourcing
Integration of Operations, Suppliers
Risk Management, Analysis
Lean operations: economical and efficient business: a business or project that uses the minimum resources and number of people required for success, Total quality Managment, Six sigma
Quality Control
Bottleneck managment
Capacity Managment
Inventory Managment
Cost Effeciency ( Minimizing Cost: Set up costs, Holding costs..etc)
Technology Utilization.
Financialy measurementS( ROI, NET profit, CAsh flow)
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OPERATIONS MANAGEMENT


SELECT ANY PRODUCTION OR RETAIL OPERATION:


PROJECT EXPECTATIONS

1. FOR YOUR SELECTED OPERATION, DESCRIBE THE FOLLOWING:

? ORGANIZATION STRUCTURE

? OPERATIONS STRATEGY (STRATEGIC PLAN)

? LEADERSHIP AND MANAGEMENT ROLES

? PROCESS FLOW/FACILITY LAYOUT

? WORK SYSTEM/JOB DESIGN

? QUALITY CONTROL METHODS

? FORECASTING METHODS

? CAPACITY PLANNING PROCESS

? MATERIAL REQUIREMENTS PLANNING PROCESS

? AGGREGATE PLANNING PROCESS

? INVENTORY CONTROL

? OPERATIONS SCHEDULING

2. SELECT AN EXISTING OPERATIONAL PROBLEM. DEFINE, ANALIZE, AND RECOMMEND A SOLUTION TO THE PROBLEM.

3. DEVELOP A BUSINESS RECOMMENDATION/PROPOSAL BASED ON THE RESULTS OF ANALYSIS OF THE OPERATIONAL PROBLEM YOU SELECTED TO WORK ON.

mla format. 700-1400 word paper on My personal strengths & weaknesses. identfy abilities & skills that I possess that contribute positively in my work environment, in personal life, and in Learning Team. Identify personal areas that need improvement in same areas mentioned. Include a plan of action for imprvmnt. do all office work for a rental car buy back co. Basically run office for my boss. phones, computers, titles,mailings, export/import info/ do inventory control. At home I clean, cook care for grandchild, answer phones, place ads for rental of rooms, pay bills, do laundry, paint rooms. Weaknesses. Procrastination, time management, essay writing. Formatting of papers. I am a grouper, amiable, expressive. Learn best by having music in background, no noise. Like to be shown how to do something and then left alone to do it. Do not take criticism well. Really bad at oral presentation. just back in school. 53 years old. First class taken in an accellerated course. Grammar needs a little help. I am a take charge type of person once i know what I am doing. Some consider me aggressive.

Essay title:
Please choose an area or topic in supply chain management or logistics that interests you and describe the research you would like to be a part of or see done. Feel free to cite examples from your work experience, readings, and previous courses.

I have written an initial draft at this essay, which reflects how I would to see this question answered. I need help making this essay compelling, as well as citing relevant and useful reference sources. I will also provide a zip file after placing the order, which includes additional notes, reference sources as well as the essay below.

Please do not hesitate to call me at any time if you have any questions about this. at 571.432.6707

Current draft:
I would like to explore how recent advances in low cost robotics technology can open up additional areas of the Supply Chain as potential candidates for Automation. A key part of this research would be to identify the cost reduction drivers affecting the application of these technological advances.

A 2010 Analyst report published by the Aberdeen Group entitled, Robotics going mainstream: Improve Warehouse Productivity and Safety indicated that recent advances in cost-effective mobile Robotics based solutions have reduced ownership costs and accelerated ROI timescales for . Research is warranted into how these and other recent advances in low cost automation technology can help small, medium and large companies achieve improvements across the entire supply chain.

While automated assembly plants have been a stalwart to automotive manufacturing in the United States since the 1960s, these traditional Robotics systems have been prohibitively expensive for many companies, and for many areas of the Supply Chain.

A 2009 Computing Community Consortium (CCC) whitepaper on Robotics and automation concluded that effective use of robotics will increase U.S. jobs, improve the quality of these jobs, and enhance our global competitiveness. In order to truly reap these benefits, it will be essential to illustrate to companies how the use of modern automation systems can really be the catalyst that will enable them to streamline processes, improve quality and reduce operational costs.

A fundamental question that I would like to see answered as part of my research is how to quantify effective use of robotics in the Supply Chain.

To provide a holistic perspective, it is also important to explore how modern technological tools and approaches like Electronic Product Codes (EPC), RFID tags, real-time inventory control systems and other foundational elements key to support the uptake of this new generation of Robotics are currently being leveraged.

Step-wise view, comprising current and near

1) Review of current and near future SCM commercially available robotics approaches (As part of this review, I would also perform a brief analysis on expected developments within the coming 5 years. Particularly those areas that show the most promise to supply chain optimization within the next 10 years).
2) Survey of companies who are currently using Robotics to address supply chain problems.
3) Survey companies who have already been turning to technology to help them improve their productivity.
4) Value chain Analysis in the Industrial Robotics Industry.
5) Systems thinking approach to explore drivers for wider acceptance of low cost Robotics based applications.

Its important to reconcile the review of any current technological approaches with the cost drivers that will be top of mind for Supply Chain Executives at leading companies.
ABC research in 1996 concluded that Drivers including the increasing need to be globally competitive, which means providing ever increasing quality at an ever reducing cost.

Uptake of Robotics technology in the Supply Chain will be iterative in nature, and heavily dependent on the advancement of other foundational technologies. As with the application of any new technological tool, there will always be some low-hanging fruit, those areas that will benefit the most from the application of the technology. Through the research mentioned above, I aim to identify potential high-impact areas that companies can quickly achieve, and I would also like to identity and explore the factors that will affect uptake of these new automation approaches.

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Assigmment:
For the majority of manufacturers, the plant floor is the weakest link in their supply chains, yet that is where they are apt to find the biggest payoff from e-manufacturing. Industrial equipment manufacturers, for example, have been fairly slow to jump on the e-business train. About 11% of these manufacturers are actively tying the plant floor to the Internet. Two exceptions are the semiconductor and computer equipment industries, where ferocious competition is impelling manufacturers to connect their plant floors with the top floor of their enterprises. The number of companies that have plugged their shop floors into the Internet is not what one might expect, but it is rising rapidly, according to some experts.

Write a 4-5 page paper answering the above question. Please turn this in to me by the end of this module

Sources:

Factory Floors Go Online -- Pioneering manufacturers close the final gap in their supply chains
InternetWeek; Manhasset; Mar 12, 2001; Michael Alexander

Abstract:
For the majority of manufacturers, the plant floor is the weakest link in their supply chains, yet that is where they are apt to find the biggest payoff from e-manufacturing. Industrial equipment manufacturers, for example, have been fairly slow to jump on the e-business train. About 11% of these manufacturers are actively tying the plant floor to the Internet. Two exceptions are the semiconductor and computer equipment industries, where ferocious competition is impelling manufacturers to connect their plant floors with the top floor of their enterprises. The number of companies that have plugged their shop floors into the Internet is not what one might expect, but it is rising rapidly, according to some experts.

Full Text:
(Copyright 2001 CMP Publications, Inc. All rights reserved.)


For the majority of manufacturers, the plant floor is the weakest link in their supply chains, yet that is where they're apt to find the biggest payoff from e-manufacturing.

Industrial equipment manufacturers, for example, "have been fairly slow to jump on the e-business train," said Reinhard Geissbauer, head of the North American industrial equipment practice at strategy consultancy Roland Berger. About 11 percent of these manufacturers are actively tying the plant floor to the Internet, the company stated in a new report that found the manufacturing sector being slowly e-transformed (see graphic, page 22).

Two exceptions are the semiconductor and computer equipment industries, where ferocious competition is impelling manufacturers to connect their plant floors with the top floor of their enterprises. The number of companies that have plugged their shop floors into the Internet is not what one might expect, but it is rising rapidly, according to some experts.

Printer maker Lexmark International Inc. has been deploying systems that are used over the Internet to manage and monitor its ink- cartridge manufacturing at all of its plants worldwide.

Although the project is far from complete, these systems already are capturing manufacturing data on Unix servers and generating reports in HTML for viewing on thin clients. Lexmark is installing Camstar's InSite manufacturing execution system (MES) to use as a common platform for capturing and processing data at all of its plants.

It will take nearly two years from inception to complete the project, and it is too soon to quantify the savings from using the Internet to monitor production processes. But Todd Sills, IT project manager at Lexmark, is confident there will be bottom-line benefits.

Lexmark's primary motivation is to reduce the number of defective products or unusable manufacturing leftovers, which many manufacturers call "scrap." Last year, Lexmark had $1 million worth of scrap returned to one of its plants in a single lot, and plant engineers lacked sufficient data to pinpoint the source of the problem. Costly problems like this clearly showed that "engineers did not have adequate information online and in real time, and they couldn't do preventive and continuous process improvement," Sills said. "All they could do is react to a crisis."

Plant engineers now monitor ink cartridges throughout the production process and can also measure product quality, with real- time access to information on product tests via the Internet.

"For example, an engineer, after doing some studying of a returned or defective product, could come in through a thin client and put that entire batch on hold anywhere in the world," Sills said.

Perhaps the main reason so few manufacturers have transformed themselves into e-manufacturers is the complexity of adapting their existing manufacturing infrastructures. Although manufacturers have deployed technology on the plant floor for several years, they are likely to be proprietary or legacy automation systems that cannot talk to the rest of the enterprise's systems, said Ken Crater, president of Control.com, a manufacturing controller consulting company. "The shop floor today is where computing technology was in the '70s," Crater said.

The plant floor has focused more on manufacturing quality, optimizing production processes and productivity, and less on customer demand. Sophisticated controllers, other intelligent devices, LANs and MESes all collect data that could be used for marketing or customer service, but those data rarely cross the plant floor to an ERP, which may or may not be capable of processing that data.

Rob McKeel, vice president of marketing for GE Cisco Industrial Networks, said providing basic connectivity to an ERP is hard enough, but the advent of the Net means many customers are seeking to change their business models from a build-to-stock to a build-to-order model. Such moves require "another level of complexity requiring cultural, process and technology changes," he said.

Crater said manufacturers need to see this transformation as inevitable or they risk going out of business. E-business customers are demanding more customized products, faster delivery schedules and instant access to order status.

Manufacturers stand to benefit too. Ways to lower the cost of business include more accurate demand forecasting and planning; streamlined production scheduling; higher quality; and fewer errors as information moves from one business process to another.

"If you look at the problems that manufacturers say are their top challenges, a lot of them relate to competitive pressure, the need to respond [to their customers] faster, and to achieve top-line sales goals," Roland Berger's Geissbauer said. "Things like that actually lend themselves to e-business effects."

Manufacturers already using the Internet see annual cost savings of 6 percent across the value chain, from procurement to Web-based supply chain management and after-sales service, said Geissbauer. It may be possible to cut costs by as much as 8 percent to 10 percent, he said.

Semiconductor manufacturers, and many of the larger computer companies that have transformed themselves into e-manufacturers, are demanding that their key suppliers connect their plant floors to the Internet so they can get visibility into their supply chains-even peer into what's happening on the plant floor itself.

In fact, Lightwave Microsystems has accelerated its plans to connect its manufacturing processes to the Internet because customers such as Lucent are requiring it, said Doug Barnes, Lightwave's manager of IT development.

"We have to do it because if we don't, our competitors will," Barnes said. Lightwave is furthering the trend by requiring its suppliers to become e-manufacturers, he said.

Lightwave, which makes circuitry for optical communications, is busy trying to figure out "whether it has enough mileage in its ERP system for the supply chain or whether we have to go to a different platform," Barnes said. The trick will be not to "splinter the existing technology" the company already has, requiring IT to support a multiple of platforms, he added. "The better you can plan your supply chain, the more competitive you're going to be."

Barnes estimated that the company will have a pilot deployed by the third quarter of this year. He anticipates that it will cost about $500,000 for hardware, software and development work for the first phase of the project, and $500,000 more for a fully Internet- capable manufacturing supply chain.

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Automotive Design & Production. Cincinnati: Aug 2002. Vol. 114, Iss. 8; pg. 70, 3 pgs

Abstract (Document Summary)
There is room for improvement in automotive's management of inventory. First, automotive should do unto logistics management as it has done to production management. Second, automotive should infuse the supply chain with more information. Third, automotive should do a better job collaborating with its supply chain partners. Last, automotive should implement new software. The best bet is to lean out business operations. Implementing supply chain collaboration is a great opportunity for taking some of the empty costs out of the supply chain. Another approach to inventory management is to apply service-parts technology to the inbound supply side.

"It's not like the automotive industry has all this inventory lying around," says Karen Peterson, vice president and research director for Gartner Inc. (Stamford, CT). In fact, adds Paul Hebeler, automotive industry director for Oracle Corp., from his office in Troy, Michigan, "The industry has inventory as tight as it can get without sacrificing cost and service." The 11 sweet spot" nowadays in automotive, he says, seems to be in chasing premium freight cost reductions. But there is room for improvement in automotive's management of inventory. First, automotive should do unto logistics management as it's done to production management. Second, automotive should "inf use the supply chain with more information-replace inventory with information," says Peterson. Third, automotive should do a better job collaborating with its supply chain partners. Last, automotive should implement new software.

Implement "lean" appropriately

Inventory results from at least one of two conditions, says Kevin Prouty, research director at AMR Research (Boston, MA). "Ignorance equals inventory. Or variability equals inventory," (Even the leanest of automotive manufacturing operations, namely Toyota, keeps inventory, he adds.)

In the first condition, if you don't know what the guy upstream or downstream is going to do, you keep inventory just in case. (Optimizing asset utilization is another reason, but this article will skip over that.) In the second condition, you can have all the inventory in the world, yet you still might not have enough for optimized manufacturing because of the variability driven by demand spikes (namely customer orders), by the manufacturing processes themselves (such as the effect of automotive options on assembly schedules), by logistical upsets (think September lith), or a combination thereof.

When companies try to circumvent Prouty's Little Law of The Conservation of Inventory, somebody gets caught holding the, uh, inventory. "If you push inventory away from one partner operation, it'll move out in either direction-either to finished inventory or down to the suppliers." That's fine in the short term for reducing localized costs; namely, for the partner pushing inventory somewhere else. But in terms of lifecycle costs, the carrying costs add up and too many instabilities creep into the supply chain.

The best bet is to "lean" out business operations. North Amer ican automotive companies have done this in manufacturing, says Prouty, but they haven't leaned their supply chain processes. "And I don't mean 'lean' to the point where you don't have inventory; I mean lean in the way you operate the company." For instance, instead of fighting change and trying to create a steady-state supply chain, come up with ways to better respond to change faster and more efficiently-even if that means building up inventory.

Gain visibility

Implementing supply chain collaboration, says Jim Kowalski, group vice president of automotive for Manugistics Group, Inc. (Rockville, MD), is a "great opportunity for taking some of the empty costs out of the supply chain." By the way, Kowalski defines "collaboration" as "real, two-way communication, where there are discussions about what should be done." For instance, Kowalski suggests joint capacity planning, where supply chain partners share in calculating capacities across multiple suppliers and tiers. Helping such collaboration is, for example, the Supplier Network Collaboration that Manugistics helped implement at DaimlerChrysler. Rather than transmit a series of ever-truncated electronic data interchange (EDI) commands from one tier to another over what used to take 14 days, DaimlerChrysler broadcasts demand and production information down through all the tiers of its supply chain simultaneously using email. All partners in the supply chain get notification within 24 hours-and can reply in kind, and in time to offset any anomalies coming down the supply chain.

Oracle offers similar capabilities. Suppliers can surf over to the OEM's Web portal to see data at the granular level, including customer demand, production data (line, date, and time), and billing. "There's no software to load," explains Frank Prestipino, vice president of SCM and worldwide marketing for Oracle Corp. (Redwood Shores, CA).

What are these companies doing? Answers Oracle's Hebeler, "Upgrading their technology to be more collaborative."

Better decision support

"Pure visibility by itself is real-time access to bad data," points out Prouty. Advanced planning and scheduling (APS) tools can filter those data to improve inventory visibility. In the past, optimization and constraint-based planning, says Hebeler, focused on machine capacity and production bottlenecks. Now these same tools are being applied to inbound logistics.

Deere & Co. (Moline, IL), for example, recently implemented a transportation command-and-control center using Manugistics' supply chain applications. This center helps Deere optimize its logistics scheduling and maximize transportation loads based on real-world data, such as truck trailer size, transportation rates, and day of the week. As a result, Deere has reduced logistics costs approximately 10%.

By including event management and workflow, users can set up thresholds and other parameters for a wide variety of variables associated with forecasts, customer demand, production, material movement, and logistics management. These tools watch the incoming data and then send alerts (email and even voice mail) when appropriate. For instance, if you're a carrier, the software can tell you when new loads are tendered. If you're a supplier, the software can alert you to major changes in the forecast so you can adjust your production plan accordingly.

Enterprise resource planning (ERP), says Prestipino of oracle, "was supposed to deliver this wonderful thing called 'ATP'available-to-promise. Up to now, that was impossible to do. At best, ERP could inspect your warehouse. if the inventory requirement wasn't in your warehouse, then ERP would backorder the requirement. Full stop." Now enterprise systems comprising ERP, APS, and warehouse and logistics management can "peer" into your warehouses and your suppliers' warehouses around the country, even the world. Moreover, they can analyze manufacturing schedules and actually look inside the supply chain. From this, they can. respond with the particular day inventory will be available-even if the physical inventory is nowhere to be seen.

The lesson here? Evaluate-and implement-the integrated enterprise applications coming onto the market today. Or, at the very least, implement individual software applications that follow those standards that make seamless software integration a reality.

Improve marketing

It's a fact of life, explains Karen Peterson of Gartner: Projected demand in the automotive industry can change 400% up or down-daily. That has to be smoothed out-from the very beginning. One way is to limit the proliferation of options. Asks Peterson, "I mean, who's going to want a pink car with yellow seats?"

Mitsubishi America, for example, rationalized the number of options it was providing. Doing that improved the OEM's ability to forecast, as well as get more accurate forecasts. Likewise, continues Peterson, better market analysis is needed to gain a better idea of what customers actually want. "if the dealer has only yellow pickups and that's what people buy, that doesn't necessarily mean that's what people want."

Outsource inventory

Another approach to inventory management is to apply service-parts technology to the inbound supply side, namely, 11 vendor managed inventory" (VMI). For proof of concept, look at Dell Computer. Dell has virtually no inventory other than the finished product shipped to customers. All the inbound supply-side inventory is maintained by Dell's vendors. Granted, this approach makes Dell's no-inventory claim somewhat disingenuous-the suppliers are carrying the inventory in plants and warehouses camped around Dell's assembly plant in Austin. However, somewhere a happy medium exists between Dell's VMI and Japanese-style Keiretsus for North American automotive industry to further investigate.

Tighten partner relationships

"I'd love to say it's all technology and technology is going to win over everything else, but it's not," says Peterson. This is not necessarily an inventory or technology issue, she continues, but OEMs and suppliers must create win-win, or partnership, relationships in sharing information. Doing that requires another "implementation": Trust. "A vast difference exists between collaboration and dictation," explains Kowalski of Manugistics. Most automotive manufacturers, particularly the OEMs, tend to view their relationship with their supply chain as adversarial, command and control: "Here's our forecast, here's our production schedule, now meet it." Too often, meeting those demands is done at great expense, such as through premium freight.

How can automotive companies establish trust? "Not easily," says Peterson. One way is through better contracts that are less abrasive, better at quantifying the value for suppliers to implement changes, and more apt to actually share the benefits. Kowalski has these suggestions. Initiate programs that embrace suppliers and wherein you work cooperatively with your suppliers. "The last time I checked, that business model is much more popular than the Lopez model," adds Kowalski. Next, let people act on the information they're collecting and supposedly collaborating on. Such "empowerment" goes beyond typical procurement versus supplier relationships. Last, realize that trust is built upon sharing information. In the past, suppliers tended not to say too much because they were afraid that what they said would be held against them "in the court of purchasing," says Kowalski. Conversely, OEMs didn't say too much because they wanted something to hold over their suppliers.

In the final analysis, three things become obvious. First, sharing data is a competitive advantage. Second, actions speak louder than words. Third, OEMs tend to drive the supply chain, so the onus is on them to initiate, facilitate, and then stand by this collaboration with their supply chain partners.

Get back to basics

North American companies too often try shortcuts. "They'll take a technology, say it looks like a `best practice process,' put it in place, and make their people work around it with little regard to the legacy and human resource issue around it," says AMR's Prouty. "Usually some piece progresses the company, but the entire implementation never lives up to the expectation."

So, start small, have a vision, get your own house in order. Look internally. Determine what's the variability that's driving you to maintain inventory. Is it because of internal business processes or external? Too many companies collaborate with their supply chains before figuring out how to collaborate internally. Last, don't spend a ton of money on a product development system. Instead, focus on getting the tools to make you faster and better.

[Sidebar]
MASLOW'S HIERARCHY OF NEEDS & THE SUPPLY CHAIN

[Sidebar]
Nobody is going to self-actualize until they have their lower levels satisfied first, explains Karen Peterson, vice president and research director for Gartner Inc. "To me, supply chain planning is self-actualization."
Human psychologist Abraham Maslow wrote in the mid-'6os that some people reach higher levels of creativity, consciousness, and wisdom-called "self-actual ization"-after satisfying a hierarchy of basic needs. Biological/physiological needs are at the lowest, most-basic level. These needs include oxygen, food, water, and a relatively constant body temperature.

[Sidebar]
Now look at automotive suppliers. They have undergone a huge number of mergers and acquisitions, explains Peterson. They're still trying to bring that all together with their own data. They are also still trying to get basic systems processes all together, Till then, they're not ready to work on external initiatives. This is where Maslow's Hierarchy comes in-and a Catch-22. The suppliers "need to get through the technology that's going to enable them technologically to be more flexible in the future," says Peterson.
In particular, automotive OEMs and Suppliers need to implement a broad set of technologies called, for a lack of a better term says Peterson, "extended enterprise management tools." These will, as with Maslow's Hierarchy, provide the stability at the lowest levels of enterprise management and add the analysis tools at the top for intelligent decisionmaking.

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Steele, A. L. (2001). Cost drivers and other management issues in the JIT supply chain environment. Production and Inventory Management Journal. Alexandria, 42(2), 61-68

Abstract
Since Just-In-Time was introduced to the business world, companies have been scrambling to replicate the system. As simple as this system of production appears, 30 years later many companies are still struggling with the concept. The implementation issue is a very real problem in JIT, and ongoing problems can be one of the largest cost drivers for a corporation

Copyright American Production & Inventory Control Society, Inc. Second Quarter 2001
Since the early 1970s when Toyota introduced Justin-Time (JIT) to the business world, companies have been scrambling to replicate the system. As simple as this system of production appears, 30 years later many companies are still struggling with the concept. Some have had success implementing a hybrid of JIT, but as the experts will tell you, if the complete system is not implemented it does not qualify as JIT. Other organizations have tried to implement the system but had to scrap it because of internal problems or problems with their vendors or customers. Still others have stayed on the sidelines, waiting for the perfect set of implementation plans to come along.

The implementation issue is a very real problem in JIT, and ongoing problems can be one of the largest cost drivers for a corporation. A company must start internally and redesign the manufacturing setting for JIT. The system cannot simply be plugged into the existing setting and be expected to flourish. Even after successful internal implementation, companies can reach a point at which it is difficult to squeeze additional efficiencies from their internal operations. It is at that point the company must go beyond its own setting and look up and down the supply chain to identify areas in which its customers or suppliers can help improve its efficiencies [8].

For managers, that can be a daunting task, but it may be where the true cost drivers in JIT reside. Managers must tackle issues such as product delivery logistics, purchasing communications, and any other unforeseen problems that might arise, but not even the most thorough managers can plan for catastrophic failures in the system, such as destruction of a supplier's manufacturing facility by fire or unexpected strikes by union workers.

This article will attempt to identify cost drivers, or problems, in the JIT production system and describe ways companies have successfully conquered them. The first part of this discussion will include issues of implementation, product delivery logistics, and purchasing. The section will conclude by addressing two concepts, total quality management and continuous improvement, which companies must master to make JIT work. Finally, common questions managers may have in regard to JIT production will be considered.

THEORY OF JIT PRODUCTION

A discussion of JIT would not be complete without considering Toyota Motor Corporation. Toyota is commonly cited as the originator of JIT, a production process that attempts to get the right quantity of quality parts to the assembly line at the exact time they are needed for production. This method in its most basic sense is a continuous process aimed at eliminating waste and solving problems throughout the supply chain [8]. It is synonymous with Japanese management techniques, which intimately integrate suppliers and customers along a supply chain, requiring total quality management (TQM) at every link in the chain.

Toyota will be the first to admit that the system is far from perfect. The company believes problems are an inherent aspect of the system and require the user to continually look for ways to improve the processes and efficiencies in the system. When the company feels it has reached a tangible level of JIT, it adjusts the goals to a higher level [7].

JIT production consists of three separate divisions. The first is the materials system within JIT. The flow of materials through a JIT production system is the most visible activity within JIT; often the materials flow is seen as the only activity to be managed in the system. However, it is the least important aspect. It is selfadjusting in accordance with customer demand and includes a buffer to absorb the natural variability within the system. The goal is to eventually eliminate the buffers. Frequently, failures with JIT have been attributed to poor demand forecasts. It is questionable whether or not the people making those kinds of claims truly understand JIT production; according to the theory of JIT, a demand forecast is not needed.

The second branch of JIT production is production planning prerequisites. The most important part is TQM.

TQM ensures that quality products will be made and a limited amount of inspection time will be required.

The final branch is continuous improvement of the system. Most organizations using JIT production fail to effectively execute continuous improvement. As a system becomes more efficient, many companies will be satisfied with the improvements they have achieved and will not seek to further improve the system. Even if a company sees an area in which it can make improvements, it may be difficult to justify doing so because the return on investment is very low.

COST DRIVERS OF JIT

The following section covers a variety of cost drivers related to JIT manufacturing. The first to be discussed is implementation of the system. It is important to know some of the costs and pitfalls associated with the internal reorganization of the firm that intends to use JIT production. A few of the issues relate to product and plant layout, computerizing supporting systems, improving the systems employed, and educating vendors and customers up and down the supply chain.

Other cost driver factors related to external implementation will be considered, including product delivery logistics, purchasing, and communication with customers. Unexpected events can occur in a JIT arrangement, causing cost overruns or lost sales. These issues will also be covered.

JIT Implementation

Successful implementation is critical to the success of JIT production. A study done in 1996 suggests that the production system must be willing to make strategic adjustments consistent with the demands of its environment [17]. Yasin and Wafa, the authors of the study, believe that these long-term strategic adjustments are not feasible without short-term costs. They say that in most cases a systemwide strategic adjustment will not yield desired results unless the subsystems, mainly the input, process, output, and managerial subsystems, are modified to make feasible systemwide changes. The researchers reason that all subsystems must actively contribute to and facilitate the incoming changes to ensure that the changes are successful. Plant layouts are also important according to the study They must be adjusted, relationships with vendors and customers must be reviewed, and quality circles implemented. Yasin and Wafa identified six potentially beneficial attributes of JIT that can increase organizational efficiency and effectiveness:

1. Tends to eliminate waste in production and material.

2. Improves communication internally (in the organization) and externally (between the organization and its customers and vendors).

3. Has the potential to reduce purchasing costs, which are a major factor for most organizations.

4. Is instrumental in reducing lead time, decreasing throughput time, improving production quality, increasing productivity, and enhancing customer responsiveness.

5. Tends to foster organizational discipline and managerial involvement.

6. Tends to integrate the different functional areas of the organization, especially to bridge the gap between production and accounting.

Yasin and Wafa concluded that successful JIT firms were more oriented toward computer-integrated manufacturing and were more likely to invest in process layout modifications. They reported that successful and unsuccessful JIT firms had invested equally in quality assurance, but the successful JIT firms used it more extensively.

Administrative costs to implement these changes can be high. One article reported that all suppliers in its study said the administrative burden had increased. However, some firms managed to use existing resources to meet the challenge so that no extra charges were incurred; others reported having extra costs [15].

One fundamental thought underlying JIT is that when suppliers implement JIT, they actually are becoming a part of their customer's operations. Toyota feels the key to using JIT successfully is educating its vendors. The company believes that when it creates the partnership with its vendors, the vendors take ownership of the responsibility to Toyota's customers [8]. David Hannah, president and CEO of the Reliance Steel and Aluminum metal service center, feels it is vital to the success of a JIT supply chain that all participants learn more about the entire industry supply chain. He says that distributors in all industries need to learn more about the customer's customer, how they need to change their operations to meet those needs, and how suppliers are going to help them do that. JIT cannot be viewed as an isolated supplier-customer relationship. The relationship must extend up and down the industry supply chain [13].

Product Delivery Logistics

Product delivery logistics is another factor critical to the success of JIT manufacturing. Tuning of shipments and supplies can make or break a company using JIT. A manager must pay close attention to this issue to ensure that production delays do not turn into obsolete products and lost sales, both costly to the firm. There appear to be two separate schools of thought regarding the locality of suppliers to customers, each carrying its own costs and benefits.

Toyota believes it is key for a company using JIT to pull as much material, parts, and subassemblies from suppliers as close to its assembly plants as possible. For example, North American suppliers provide 80% of the parts, materials, and assemblies used by Toyota's Georgetown, Kentucky, plant [7]. Most suppliers are located within 200 miles of the plant. This localized supply base makes it possible for Toyota to develop a closedloop distribution network known as a milk run. The milk runs allow Toyota to receive parts on a JIT basis. Often, suppliers are required to load shipments so that the containers come off the truck in the order they will be used. Kanban cards are used to signal to suppliers when the next lot of parts is needed. A Toyota assembly line person pulls the kanban cards when the first part out of a new lot is used. The cards are then gathered and returned to the supplier with a summary of the next order.

Johnson Controls Inc. (JCI) is a producer of seat assemblies, headliners, and instrument panels for the automobile industry. It is a supplier to New United Motor Manufacturing Inc. (NUMMI), a joint venture between Toyota and General Motors. JCI subscribes to the proximity theory of suppliers to customers. JCI maintains that its costs and, more important, its response times, can be trimmed because it is located only 35 miles from NUMMI. Its lead times could be even shorter if it did not build in buffers for unseen delays, specifically California traffic [8].

Although some customers prefer to have their suppliers near them, that does not appear to be highly correlated with low costs or success with JIT. Wafa, Yasin, and Swinehart [14] examined 130 companies and found that supplier certification programs and the existence of communication/information links are much more reliable predictors of success with JIT than the geographical location of suppliers. The study actually found that longer distances between supplier and customer were positively correlated with increased success with JIT. They concluded that an increased level of communication was required to compensate for the long distances between supplier and customer. The recommendation was made that companies interested in implementing or improving JIT systems performance should invest in communication and information technologies rather than pull suppliers closer to them.

For those companies engaged in an international supplier-customer relationship, border crossings and customs clearance can be an added challenge. They can create delays in transportation and increase uncertainty in the JIT supply chain. Distribution has been cited as one of the foremost challenges of the increasing trade between Mexico and the United States and one of two primary reasons U.S. firms close Mexican operations [12]. The authors found that managers of firms demonstrating high levels of JIT success perceived that they attained better transportation service performance than managers of non-JIT firms. This study also reinforces the idea that proximity of supplier to customer is not a prerequisite to JIT success.

Purchasing and Communication

Purchasing and communication between the supplier and customer in a JIT environment require a large investment. The supplier must not only make the investment in information technology but must take the time to truly learn about the client's business.

A new technique called JIT II has evolved in JIT purchasing. Lance Dixon, former Bose Coropration director of purchasing and logistics, is credited with creating this new concept. According to Dixon, JIT II empowers the supplier within the customer's organization [3]. JIT II is an intimate arrangement that allows a supplier, at its own expense, to place supplier representatives in the customer's organization. Generally, the representative is placed at the customer's site full time and has the responsibility of monitoring the buyer's inventory and keeping it replenished. Dixon feels the subsequent efficiency results in bottom line improvement for both supplier and customer.

It is now being suggested that electronic data interchange (EDI) systems, which most manufacturers currently use, can help suppliers eliminate the need for an employee at the customer's site. A system of information exchange for orders can be created and monitored by the customer's own employees or by a supplier's representative.

Radovilsky, Gotcher, Mistry, and Yip [11] surveyed plant managers of automotive, electronic, and machinery firms. Each plant used JIT purchasing to support its manufacturing plant. Fifty-one percent of the managers said that relationships with suppliers were the single most critical element to success in JIT purchasing. Twenty-three percent reported that the biggest difficulty in using JIT purchasing was the lack of support from suppliers. The authors concluded that the JIT philosophy in purchasing resulted in a number of positive outcomes. Some of those were inventory reduction, increased quality, and a reduction in overall production and inventory costs.

One of the benefits of JIT is that customers can reduce inventory and therefore eliminate capital outlays for inventory warehouses. However, many firms are now warehousing inventory or requiring suppliers to warehouse inventory. This buffer allows for fluctuations in demand and allowances for temporary supply interruptions. This type of JIT hybrid is becoming more popular and is sometimes costly to the supplier.

One example of the system is now being used in the automotive industry. General Motors, Ford, and Chrysler have set up steel warehouses that support regional stamping plants. The cost of storing the steel is covered by someone else, usually the steel supplier, because the automakers do not want to carry the inventory on their books [9]. Chrysler requires that 15 days of steel be inventoried at each warehouse. The steel is then delivered to the plant in JIT fashion. This type of JIT arrangement is used because the stamping schedules at the plants are erratic, which causes bloated lead times. Pete Peterson, director of automotive marketing for U. S. Steel, says that much of what they are dealing with is simply communication and information processing. His goal is to have a smooth flow of steel from the steel mill shipping dock to the stamping floor; he believes that will be accomplished in the next 10 years.

Unexpected Events

Some of the purchasing strategies explored in the previous section were less than ideal for a supplier in the JIT supply chain. Suppliers warehousing steel for an automotive customer at its own expense leads many to say that inventory is not eliminated or reduced but simply pushed up the supply chain. Many of the supply chain customers want these buffers to protect against unforeseen problems. Two situations in recent memory have reinforced the behavior.

The JIT method that includes larger than normal inventory buffers is sometimes called JIC, or just in case production. JIC is identical to JIT, but subscribes to the belief that bad things sometimes happen to good companies. It is thought that at some point lean inventory levels will be erased because of an unforeseen catastrophe. One such incident occurred in February 1997 when Aisin Seiki Company, a supplier for Toyota in Japan, had an entire brake parts factory burn to the ground. Aisin had just three days supply in its warehouse. Because of this problem, Toyota missed selling an estimated 50,000 passenger cars. Contributing to the problem was the fact that all of Toyota's parts plants were at full capacity so the company could not pass production off to one of its own plants [5].

The International Brotherhood of Teamsters' strike in 1997 disrupted UPS shipping services throughout the United States. That type of situation is exactly what risk managers at Johnson and Johnson try to avert. Johnson and Johnson had put contingency plans into effect well before the strike and saw only minimal disruptions in deliveries to its customers. Insurance is available for these types of business interruptions; however, although insurance can give a company its money back it will not bring back its customers [18].

General Motors experienced problems in 1996 when a labor strike halted operations at 22 of its 29 car and truck plants in North America. The strike cost the company $600 million to $800 million in lost profits. Executives at GM say that though the lack of finished goods inventory in the supply chain affected shortterm performance, the long-term advantages of JIT far outweigh the risks [6].

One final case for the JIC approach to manufacturing is the incidence of missed sales due to unexpected demand. Some companies regard inventory as opportunity inventory. In general, they say this particular inventory does not sell quickly but when it does, margins on the inventory are higher than for typical products [16]. Demand Forecasting-A JIT Problem?

In the purest form of JIT production, a demand forecast is not required. However, many hybrid production systems exist, and some suppliers feel it is wise to use forecasts from customers to pace their system. In this situation suppliers depend on the customer to provide them with accurate and timely demand forecasts. That is the case for suppliers who use a build-toorder system. Miller SQA, Inc., a company based in Holland, Michigan, makes a wide variety of office furniture. According to Bill Bundy, vice president of operations, schedule stability is often considered key to JIT production in the world of mass customization. He says that with hundreds of thousands of product variations and the demands of a build-to-order system, the company's schedule might be stable for only three or four hours. Its need for chair arms is one example. In one recent week the company needed 478 chair arms to meet demand; the next week it needed only 7. Without accurate information from the customer, suppliers cannot efficiently use JIT within their own manufacturing operation.

Much has been written about the growing disenchantment with suppliers who lack the ability to deliver product to customers on time. The underperforming supply base is only one of the problems that exist with JIT. A 1997 survey suggests that although information availability and communication are important, most companies rely on the sales and marketing departments to create forecasts. Only a few companies are providing suppliers with consistent real-time access to their fluctuating production schedules. Most participants in the JIT supply chain believe that an inventory system is only as good as the data put into it [10].

Others involved with JIT feel that each customer molds JIT according to its own needs. In a previously mentioned case within the automobile industry, suppliers were forced to stock steel in warehouses located near the stamping plants. They had to incur the expense to warehouse a minimum of 15 days of inventory just so the automobile manufacturers could withdraw the inventory in what they claimed was a JIT manner. Only the customer in this case realized the JIT cost savings; the supplier had to continue to produce and warehouse finished goods inventory. Arrangements such as those do nothing but reinforce the fact that the customer does not have to provide accurate demand schedules to the supplier. Such cases might support a JIT II situation in which the supplier can rely on its representative to provide accurate and timely orders.

In some situations customers who use JIT methods may want delivery within three months, whereas others need JIT delivery in three hours. Uneven and unpredictable demand means that suppliers must resort to holding more inventories of raw materials and finished goods [16].

Total Quality Management

No discussion of JIT production would be complete without considering TQM. It is the only component of JIT that can stand alone as its own concept. The Rover Group, a subsidiary of BMW, considers TQM an important part of delivering its customers the products they desire. The group is constantly challenged to deliver distinctive products with varying levels of style, quality, capability, and power. The Rover Tomorrow program was created to replace the traditional, functional, hierarchical structures with a flexible processoriented organization built on the principles of multifunctional teamwork, empowerment, and continuous improvement [4]. The program focuses on delivering extraordinary customer satisfaction. As a result of this program, significant benefits have been realized, most notably product development times have decreased from seven years at the end of the 1970s to three nears in 1996.

One of the main underlying concepts of TQM is empowerment of the employee. Many people point out that this can be a major problem. It is emphasized that TQM will work only if employees truly care about their jobs. Keith Grint [21 explains that this is one management "wave" that tends to crash over and can drown an organization. He states that involvement and commitment of the workforce is required on all levels. And because quality control must be delegated to the lowest possible position, shop floor workers and office workers are responsible for their own quality control. Quality can be guaranteed only if everyone is fully committed and trusted. In a TQM environment managers cannot closely monitor their employees without undermining the trust and self-direction required. Grint asserts that employees must take ownership of their jobs and this ownership cannot be imposed from above. If it is, then what you have is employees being "forced to be free." Lack of employee commitment, therefore, sets a system up to fail.

Overall, TQM is a vital part of a JIT production system. It ensures that quality parts will be produced in the JIT supply chain. As stated before, this system relies on the employees closest to the production processes to control the quality of the products. In theory, final inspections are not needed nor are inspectors. If a problem occurs or a trend is identified that may lead to quality problems, employees have the right to stop the process and correct the problem. One study reports that managers using JIT production methods attribute the improved quality of incoming materials to the implementation of TQM and statistical quality control on the supplier's side [11].

Continuous Improvement of the JIT System

Continuous improvement is a concept closely tied to TQM. For the JIT production system to improve, employees must be the ones driving the change. Usually the most obvious and easiest to correct problems give organizations the largest return on their investment. Often, these problems center on costs related to setup times, plant layout, and material acquisition processes. According to Rod Rodin, president and CEO of Marshall Industries, to continuously improve means to eliminate costs; cut out duplication; eliminate transactions; and increase quality, market share, and customer satisfaction [1].

Once these problems are solved more problems may be identified but not acted on. This is where the breakdown of continuous improvement begins. Companies can identify factors they should change; however because of the influence of traditional performance measurement systems, financial justification for the change becomes important. Improving the process or the product is no longer the issue; the issue becomes whether or not it makes sense from a return on investment standpoint to improve the system. That mind-set may keep organizations from truly improving the JIT production system.

QUESTIONS FOR MANAGERS

The discussion above has focused on cost drivers and other problems associated with JIT production systems. It appears that any discussion about JIT production will be condensed to three main questions managers in these environments must answer. First, does JIT production really work? Second, does the system work better in some industries than in others? And finally, are the costs associated with JIT really worth the effort required to convert the svstem?

In response to the first question, we can conclude that, yes, JIT production does work. It appears that the main obstacle in making it work is the commitment of the company implementing the system. The company must be dedicated to implementing all three parts of JIT. The most easily implemented process is the materials movement system. Organizations must go beyond that to changing the production processes such as machine setups and production layout. TQM should be used to eliminate quality problems and the waste of rework. Continuous improvement is the vital third leg of JIT, but often this is where companies come up short. To implement continuous improvement in an organization, traditional performance measurements must be scrutinized and not allowed to get in the way of the overall goal of improvement of the products and processes of the company.

That leads us to the next question. Does JIT production work better in some industries? Again, the answer is yes. Managers must look at the type of production environment they operate in. If the system requires a great deal of customization or operates in an engineer-- to-order environment, JIT production may not be compatible. It will allow for some customization; however, it is best suited for a production environment with a high level of standardization and even lot sizes. Trying to use the wrong production technique in the wrong environment is a sure way to fail. Looking deeper, we see that even within the same industry some companies are more successful with JIT production than are others. The critical factor seems to be the discipline of the company while implementing JIT production and its commitment to continually improve the system.

Now to address the final question. Are the costs associated with JIT production worth the benefits? The answer to that question can be seen as a function of the answers to the first two. To derive the greatest benefits from JIT production, an organization must be sure the system fits its production environment. Furthermore, the organization must be dedicated to appropriately implementing the system and empowering the workforce to make JIT work. As mentioned before, simply plugging JIT into an existing production system will not guarantee success. Change within the system must be managed to successfully achieve desired resuits. And according to the literature, when it is implemented correctly, JIT production benefits can far outdistance the costs.

CONCLUSION

JIT production systems can afford organizations many benefits. It is important, however, that companies know what the associated costs are. More important, the managers implementing the systems must be aware of the pitfalls and sometimes subtle costs related to JIT production. Some of the costs are due to implementation issues, which may require a company to redesign its production processes to better fit JIT. Other costs are linked to material or inventory flow through the system. Still more costs are related to material acquisition and communication to vendors. And, we should not forget, unexpected events can occur that can be catastrophic in a system that runs on lean inventories. These types of disruptions in the supply chain can be costly.

In addition to being aware of the cost-driving issues, managers in a JIT environment must use TQM and continuous improvement to keep the system functioning optimally. TQM ensures that the quality of the product will remain high. Continuous improvement forces managers and employees to search for ways to make the system more efficient. The continuous improvement requirement of JIT is usually where organizations fall short. For continuous improvement to occur in a JIT organization, traditional performance methods must be used only when deemed appropriate. Costs related to continuous improvement usually increase as return on investment decreases. It is because of this paradox that continuous improvement efforts usually cease.

JIT production continually strives to eliminate waste in the production system. When a supply chain in which JIT production is used, is looked at holistically, it is often noted that the lines between supplier and customer are almost invisible. Although organizations' internal managers manage JIT production, suppliers and customers themselves must look outside their companies and help each other make JIT production work. My definition of supplier-customer relationship extends beyond defining the customer as the ultimate end consumer of a product. It is my belief that the supplier-- customer relationship is a cycle that is repeated within the industry in route to the final consumer. To appropriately evaluate the relationship, you must look up and down the supply chain. Simply looking at one relationship in isolation is not enough. Oftentimes, relationships throughout the industry supply chain decide the success of JIT. Suppliers have a responsibility to learn about their customers and take ownership and responsibility to the end user of the product.

[Sidebar]
*This is an edited version of the prize-winning part-time graduate submission in the 2000 Donald W. Fogarty International Student Paper Competition sponsored by the APICS Educational and Research Foundation.

[Reference]
REFERENCES
1. Carbone, J. "Wanted: More VA from Distributors." Purchasing 121, no. 4 (1996): 47-51.
2. Grint, K. "TQM, BPR, JIT, BSC's, and TLA!s: Managerial Waves or Drownings?" Management Decision 35, no. 9-10 (1997): 731-738.
3. Henricks, M. "On the Spot.- Entrepreneur (May 1997): 80-82.
4. jina, J. "Automated JIT Based Materials Management for Lot Manufacture." International Journal of Operations and Production Management 16, no. 3 (1996): 62-75.
5. Koepfer, G. "A 7ust-in-Case' Case?" Modern Machine Shop (April 1997):10.
6. Minahan, I "Did the GM Strike Prove That JIT Doesn't Work?" Purchasing 120, no. 7 (1996): 28-29.
7. Minahan, T. "JIT.- A Process with Many Faces." Purchasing 123, no. 3 (1997): 42-46.
8. Minahan, T. JIT Moves Up the Supply Chain. Purchasing (Sept. 1, 1998): 46-47, 51-52, 54.
9. Ninneman, P "Just-in-Time Warehouses." (Steel Forum) New Steel 13, no. 7 (1997): 100.
10. Porter, A. "The Problem with JIT." Purchasing 123, no. 4 (1997): 18-19.
11. Radovilsky, Z., W. Gotcher, R. Mistry, and R. Yip. "JIT Purchasing: Analyzing Survey Results." Industrial Management (Nov./ Dec. 1996): 17-20.
12. Stank, T., and M. Crum. "Just-in-Time Management and Transportation Service Performance in a Cross-Border Setting." Transportation Journal (spring 1997): 31-41

[Reference]
13. Stundza, T. "Buyers Ask Service Centers: What Happened to JIT?....and a Few Other Things." Purchasing 126, no. 7 (1999): 1-4.
14. Wafa, M., M. Yasin, and K. Swinehart. "The Impact of Supplier Proximity on JIT Success: An Informational Perspective." International Journal of Physical Distribution 26, no. 4 (1996): 23-34.
15. Waters-Fuller, N. "The Benefits and Costs of JIT Sourcing: A Study of Scottish Suppliers." International Journal of Physical Distribution 26, no. 4 (1996): 35-50.
16. Yafie, R. "Profitability Becomes the New JIT Issue." American Metal Market 105, no. 160 (1997): 28A-29A.
17. Yasin, M., and M. Wafa. "An Empirical Examination of Factors Influencing JIT Success." International Journal of Operations and Production Management 16, no. 1 (1996): 19-26.
18. Zolkos, R. "Property Loss: Just-in-Time Approach Exacerbates Risk of Contingent Business Interruption." Business Insurance 31, no. 33 (1997): 3-5.

[Author Affiliation]
ANDREW L. STEELE
Orthothics and Prosthetics One, Inc., 527 Park Lane, Suite 200, Waterloo, IA 50702

[Author Affiliation]
About the Author
ANDREW L. STEELE, MBA, CPO, is vice president of Orthotics and Prosthetics One, Inc., a prosthetics (artificial limbs) and orthotics (orthopedic braces) outsourcing firm in Waterloo, Iowa. He earned a BS at the University of Iowa in 1991, completed his postgraduate prosthetics and orthotics education at Northwestern University, and earned an MBA at the University of Northern Iowa.

////////////////////////////////////////////////////////////

Drickhammer, D. (2001, May 21). Peak performance. Industry Week. Cleveland, 250(8) 36-40.

Abstract (Document Summary)
Industry leaders predict that tomorrow's top companies will succeed based on the strength of the relationships they establish, from their raw-material suppliers, through manufacturing and distribution, and ultimately to their customers. In this value chain of the future, information will replace inventory, and built-to-order, defect-free products with cutting-edge features will be delivered 100% on time at a very competitive cost. Among leading manufacturers during the last 20-plus years, people on the plant floor have finely honed their ability to recognize waste, in the form of excess handling, queue time, rework, and inventory, and to eliminate what does not add value. It is time, say industry observers, to direct a similar amount of attention beyond the factory walls.

If you're not managing your value,chain, you're not managing your business. That is the warning of industry leaders who predict that tomorrow's top companies will succeed based on the strength of the relationships they establish, from their raw-material suppliers, through manufacturing and distribution, and ultimately to their customers.

TEXT:
In this value chain of the future, all participants will know and focus on the value they add for the customer, information will replace inventory. and built-toorder, defect-free products with cutting-edge features will be delivered 100% on time at a very competitive cost. Information, products, and cash will flow in a synchronized fashion that optimizes the productivity and profitability of the entire value chain.

Most manufacturing companies fall far short of this ideal. They remain focused on one-to-one relationships, with little integration of internal processes let alone cross-organizational ones, at a time when a convergence of Webenabled information technology offers unprecedented opportunities for collaboration and sharing of information. Yet for the anticipated cost savings to be realized-analysts throw out figures in the billions of dollars manufacturers must successfully implement these software applications, and business partners must be able and willing to trust one another.

Twenty years ago purchased materials and components accounted for only a quarter of the cost of finished products. Today purchased materials represent three-quarters of that cost, so it's only logical that companies would be trying to collaborate more, with their suppliers certainly, but also with their customers. For these relationships to be effective, corporate managers first must do some hard work internally, clearing away legacy management practices and barriers between business functions. Product development, procurement, marketing, sales, manufacturing, human resources, and accounting all need to talk to one another. People have to change how they work and, equally important, how they measure success.

In effect, this is what has been happening within leading manufacturers over the last 20-plus years with the ongoing adoption of lean manufacturing. People on the plant floor have finely honed their ability to recognize waste, in the form of excess handling, queue time, rework, and inventory, and to eliminate what doesn't add value. It's time, say industry observers, to direct a similar amount of attention beyond the factory walls.

Lean at its purest is about increasing speed, removing waste, and serving the customer better," says Jeffrey C. Sinclair, a director in the Cleveland office of McKinsey & Co. and coleader of McKinsey's North American Manufacturing Practice. "In a value chain this translates into reducing leadtimes by 50% or more, slashing expensive LTL [less-than-truckload] and emergency air freight, and maximizing distribution-center productivity. This enables retailers, distributors, and manufacturers collectively to drive up customer service with much lower levels of inventory and cost throughout the chain."

Lean techniques have been so effective at transforming Deere & Co.'s internal operations that over the last three years the company has hired 94 supplier-development engineers whose full-time jobs are to work with the supply base to help them implement lean techniques. In the spirit of mutual cooperation, most cost benefits generated through the program are shared equally between Deere and its suppliers.

"Last year we spent $7 million on the program; the return in hard dollars was $22 million to Deere. That means it was roughly $22 million to the supply base as well," reports Dave Nelson, vice president, worldwide supply management, for the Moline, Ill. equipment maker and coauthor of The Purchasing Machine (2001, Free Press). "There's probably as much or more in soft dollars that we don't measure, in reduced inventory, reduced floor space, improved safety."

Toyota Motor Corp. and Honda Motor Co. Ltd. have similar histories of helping their suppliers improve their operations. Such win-win programs go a long way toward changing what is most often an adversarial relationship.

Nevertheless, today buyers in most procurement departments remain focused on squeezing their suppliers. "The problem with [such tactics] is, all you're looking at is the price of a particular component. I'm convinced that if you could really look at the systems cost of that decision you would probably realize that it is not going to get you savings. It may even end up costing you money," observes P. Jeffrey Trimmer, chairman of the National Initiative for Supply Chain Integration Ltd., who recently retired as director, operations and strategy for procurement and supply, for DaimlerChrysler AG's Chrysler Group.

"Supply chains are not about buying something a nickel or so cheaper," Trimmer continues. "These are strategic decisions. We need to be able to communicate to the CEOs, CFOs, and COOs that this is a strategic thing you need to think about."

The trendsetter of the manufacturing-outsourcing movement, the electronics industry, leads the way in taking a high-level, strategic view of value-chain management. Yet in recent months that didn't prevent overly optimistic forecasts from bloating inventory levels and straining relationships when the market turned sour.

"Leadtimes were being pushed out because of the amount of supply. Companies had to make long, threemonth commitments. Ordering product three months out tended to let a lot of inventory build up," recalls Jim Sacherman, senior vice president, Flextronics International Ltd., San Jose. At this time a year ago, everyone in the sector was doing their best to manage component shortages.

"In general our push is to not have product sitting on the water. That's a dangerous part of the supply chainthree or four weeks of stuff that there's nothing you can do about," Sacherman adds. Where possible, Flextronics has bulky items such as enclosures made near its manufacturing operations. The company invites suppliers to sit with them in the same industrial park, giving them space so material and components can be delivered on demand.

"Excess inventory is a direct result of poor communication, so you have to focus on improving communication. That means speed and accuracy," adds Dave Otterness, Flextronics' vice president, supplier management. Otterness says his job requires a lot more interface with customers than it did before. The primary reason is the amount of coordination and engineering support all of the electronics-manufacturing-service firms are providing their customers today.

"We're as much a facilitator as a product builder," he observes. "We have to facilitate our customer's forecasts, sales orders, and requirements. We have to facilitate our supplier's processes and leadtimes and cycle times back up into that."

The Tools

Aiding in the quest for the ideal value chain is a growing cadre of software and service providers. But no matter what mixture of software applications a manufacturer attempts to implement, it still comes down to the ability to get the right product to customers when they want it. The faster value-chain partners know what the customer wants, and the faster they are able to respond to that demand, the less waste in the system and the more competitive and profitable the chain.

"We talk a lot about collaboration and how important it is and everybody is talking about doing it, but in fact companies are run very inefficiently with sometimes grossly inaccurate data," says Karen Peterson, a research director with Gartner Inc., Stamford, Conn. "Start spreading that around and you're just spreading around bad stuff a lot faster."

Peterson says vendors have a long way to go toward providing scalable solutions

Resource: Cases in Financial Management
Cases in Financial Management (2nd ed.)
J. Sulock and J. Dunkelberg
Wiley, 1997

Prepare a 350- to 700-word analysis of the Reeds Clothier case in Cases in Financial Management.


Format your paper consistent with APA guidelines (6th edition), including page headers, title page, in text citations, and references page.


Analysis of the Reeds Clothier Case
Summarize the case (I will email this in a pdf. Case 16 Reed's Clotheier Inc. Working Capital Policy)

Formulate answers to questions 1??"8. For question 1, calculate the ratios in Exhibit 4 of the case.


Exhibit 4

Reed's Clothiers Selected Ratios*
Liquidity Ratios Industry
Current Ratio 2.7
Quick Ratio 1.6
Receivables Turnover 7.7
Average Collection Period 47.4

Efficiency Ratios
Total Asset Turnover 1.9
Inventory Turnover 7.0
Payable Turnover 15.1

Profitability Ratios
Gross Profit Margin 33.00
Net Profit Margin 7.8
Return on Common Equity 25.9

* Since many ratios may have different meanings the following definitions were used in the above calculation:
Receivable turnover = sales / accounts receivable
Average Collection Period = 365 / Receivable Turnover
Total Asset Turnover = cost of sales / total assets
Inventory Turnover = cost of sales / inventories
Payable Turnover = cost of Sales / Accounts Payable



Summary:

Questions:
1. Calculate a few ratios and compare Reed's results with industry averages. (Some industry averages are shown in Exhibit 16.4.) What do these ratios indicate?

(Answer:)

2. Why does Holmes want Reed's to have an inventory reduction sale, and what does he think will be accomplished by it?
(Answer:)


3. Jim Reed had adopted a very loose working capital policy with higher current assets than industry averages. If he merely tightens his working capital policy to the averages, should this affect his sales?
(Answer:)


4. Assuming that Reed's can improve its operations to be in line with the industry averages, construct a 1995 pro forma income statement. If he merely tightens his working capital policy to the averages, should this affect his sales?
(Answer:)


5. What type of inventory control system would you suggest to Jim Reed?
(Answer:)


6. What type of accounts receivable control would you suggest to Jim Reed?
(Answer:)


7. Is the increase in sales related to the increase in inventory? (See Exhibit 16.5.)

(Answer:)


8. What is Reed's cost of not taking the suppliers' discounts?
(Answer:)



Reference

There are faxes for this order.

Supply chain management is the careful attention paid to the process that sees materials, information, and finances move from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management focuses on efficiently and effectively coordinating the flows of the supply chain process both within and between companies. Often, the main goal of supply chain management is to reduce inventory thus resulting in better efficiency and reduced costs. Here are a couple of general descriptions of the inventory control problem:

Almyta Systems (2009) Overview of inventory control. Retrieved Feb. 21, 2009, from http://systems.almyta.com/Inventory_1.asp and http://systems.almyta.com/Inventory_2.asp

Since 1986, the Voluntary Interindustry Commerce Solutions Association (VICS) has worked to improve the efficiency and effectiveness of the entire supply chain...VICS is made up of companies who have proven that a timely and accurate flow of product and information between trading partners significantly improves their competitive position. It has been demonstrated that cross-industry commerce standards facilitate better customer service while reducing costs. VICS' participation with hundreds of small and large companies, has established that the implementation of VICS' business processes and standards achieve excellent returns that go far beyond initial expectations."

The VICS Collaborative Planning, Forecasting & Replenishment (CPFR?) Committee has had as its mission:

"... to develop business guidelines and roadmaps for various collaborative scenarios, which include upstream suppliers, suppliers of finished goods and retailers, which integrate demand and supply planning and execution."

You can read a summary of their work here:

VICS (N.D.) Overview of Collaborative Planning, Forecasting & Replenishment (CPFR?). Retrieved Feb. 21, 2009, from http://www.vics.org/committees/cpfr#f1

Now let?s consider a real-world description of an application of forecasting to inventory control:

Murphy, J. (2002) Enabling its field sales managers to collaborate on forecasts allowed Coca-Cola Bottling Co. Consolidated to slash inventories in half while absorbing 150 new products. Global Logistics & Supply Chain Strategies ? November. Retrieved Nov. 8, 2010, from http://www.glscs.com/archives/11.02.coke.htm?adcode=5

When you've had a chance to read these articles and to review other information from the background and other sources you may come across, please prepare a 3-4 page paper on the topic:

"True or false: Coca-Cola's experience with inventory forecasting supports the principles set forth by CPFR"

If so, how? If not, why not? Be sure to take a clear stand.

Hi,
could you please answer the questions according to the marketing ch13 summary below. Also, I would be very happy if you can send it asap the deadline for the assignment is actually today at 11:30pm would be great if you can finish it earlier.
thank you!

Supply Chain Management
You must read chapter 13 and express your opinions about the following topics:

1. Discuss the benefits of supply chain management. How does the implementation of supply chain management result in enhanced customer value

2. Discuss the concept of supply chain integration. How does it result in better customer-related outcomes?

3. What are some of the likely outcomes of a firms failure to embrace one or more supply chain integration types.

4. What are the key processes in supply chain management, and who performs them? How does each process lead to increased satisfaction on the part of the customer?



Ch13summary

automatic replenishment program a real-time inventory system that triggers shipments only when a good is sold to the end user
build-to-stock a production method whereby products are made in advance of demand based on forecasts and are stored until customer orders arrive
business processes bundles of interconnected activities that stretch across firms in the supply chain
customer relationship management (CRM) process allows companies to prioritize their marketing focus on different customer groups according to each groups long-term value to the company or supply chain
customer service management process presents a multi-company, unified response system to the customer whenever complaints, concerns, questions, or comments are voiced
demand management process seeks to align supply and demand throughout the supply chain by anticipating customer requirements at each level and creating demand-related plans of action prior to actual customer purchasing behavior
demand-supply integration (DSI) a supply chain operational philosophy focused on integrating the supply-management and demand-generating functions of an organization
distribution resource planning (DRP) an inventory control system that manages the replenishment of goods from the manufacturer to the final consumer
electronic data interchange (EDI) information technology that replaces the paper documents that usually accompany business transactions, such as purchase orders and invoices, with electronic transmission of the needed information to reduce inventory levels, improve cash flow, streamline operations, and increase the speed and accuracy of information transmission
electronic distribution a distribution technique that includes any kind of product or service that can be distributed electronically, whether over traditional forms such as fiber optic cable or through satellite transmission of electronic signals
fourth-party logistics company (4PL or logistics integrator) a consulting-based organization that assesses anothers entire logistical service needs and provides integrated solutions, often drawing on multiple 3PLs for actual service
inventory control system a method of developing and maintaining an adequate assortment of materials or products to meet a manufacturers or a customers demand
logistics the process of strategically managing the efficient flow and storage of raw materials, in-process inventory, and finished goods from point of origin to point of consumption
logistics information system the link that connects all the logistics functions of the supply chain
manufacturing flow management process concerned with ensuring that firms in the supply chain have the needed resources to manufacture with flexibility and to move products through a multi-stage production process
mass customization (build-to-order) a production method whereby products are not made until an order is placed by the customer; products are made according to customer specifications
materials requirement planning (MRP; materials management) an inventory control system that manages the replenishment of raw materials, supplies, and components from the supplier to the manufacturer
materials-handling system a method of moving inventory into, within, and out of the warehouse
nearshoring the transfer of an offshored activity from a distant to a nearby country
offshoring the outsourcing of a business process from one country to another for the purpose of gaining economic advantage
order fulfillment process a highly integrated process, often requiring persons from multiple companies and multiple functions to come together and coordinate to create customer satisfaction at a given place and time
order processing system a system whereby orders are entered into the supply chain and filled
outsourcing (contract logistics) a manufacturers or suppliers use of an independent third party to manage an entire function of the logistics system, such as transportation, warehousing, or order processing
postponement a hybrid production method whereby basic units of a finished good are manufactured in advance of actual demand and held in strategic form or location until demand occurs, when final customization takes place
product development and commercialization process includes the group of activities that facilitates the joint development and marketing of new offerings among a group of supply chain partner firms
returns management process enables firms to manage volumes of returned product efficiently while minimizing returns-related costs and maximizing the value of the returned assets to the firms in the supply chain
smart RFID an inventory handling and tracking system that employs radio-frequency electromagnetic fields to transfer and read product data via an electronic tag
supplier relationship management process supports manufacturing flow by identifying and maintaining relationships with highly valued suppliers
supply chain the connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function
supply chain agility an operational strategy focused on inducing inventory velocity and operational flexibility simultaneously in the supply chain
supply chain integration when multiple firms or business functions in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer
supply chain management a management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process, from the source to the point of consumption, resulting in enhanced customer and economic value
supply chain resilience the ability of a supply chain to return to its ideal operational state after being disrupted
supply chain risk any potential disruption that threatens the supply chains efficient and effective operations
supply chain security efforts made by companies to protect their in-transit inventory or value-transforming assets from external or internal threats
supply chain team an entire group of individuals who orchestrate the movement of goods, services, and information from the source to the consumer
sustainable supply chain management a supply chain management philosophy that embraces the need for optimizing social and environmental costs in addition to financial costs
third-party logistics company (3PL) a firm that provides functional logistics services to others
three-dimensional printing (3DP) the creation of three-dimensional objects via an additive manufacturing (printing) technology that layers raw material into desired shapes

For this case study please read the article below concerning vendor-managed inventory (VMI) and the Bull Whip Effect (BWE).

Ravichandran, N. (2008). Managing BullWhip Effect: Two Case Studies, Journal of Advances in Management Research, Vol. 5(II).

Abstract:

Purpose: The purpose of this paper is to present two examples based on real life experiences where the Bullwhip effect (BWE) in supply chain is considerably reduced. Both examples relate to the consumer durables industry in India.

Design/methodology/approach: The first example uses enterprise resource planning and vendor managed inventory as tools to reduce the BWE. The second example uses a modification of the classical inventory control policies to eliminate BWE.

Research limitations/implications: This paper could initiate research in an area which would help supply chain researchers and managers to understand why some companies are able to contain BWE and others are not.

Findings: Based on these two empirical case studies, the paper argues that managing BWE is a strategic initiative by organization and the best approach is a combination of several tactical initiatives.

Originality/value: This paper briefly summarizes the managerial approaches to tame BWE in two different contexts. The two examples have some similarities, differences and offer unique insights related to managing BWE.

Keywords: India, Supply chain management, Demand management, Consumer durables

Case assignment

Then in a 3-4 page paper discussing this question. Be sure to use additional articles and resources to support your arguments.

Is VMI a valid method for reducing the BWE? How does it compare to other inventory management methods for reducing the BWE? What conclusions can you draw?

Assignment Expectations

Research the topic with information from the background readings as well as any other resources you find on your own. The paper should be 3-4 pages in length and have a cover sheet and a reference page. Clarity of presentation is important, as well as your ability to cover the topic in a succinct, organized manner with research to back up your points. Use at least 3 different sources of information and annotate your sources of information appropriately on your references page and within the text as necessary. You will be assessed on how well you develop this case and demonstrate your understanding of VMI and its many benefits and challenges. Submit your assignment for grading by the end of this module.

Hi...again...

This paper is from a enterprenuership class...

My company gonna make new software for web content monetization (target to B2B business not B2C )...

In this paper, you should write down the SECTION VII. OPEATIONS PLAN for Web Media Contents Monetization software (B2B based)

You know this is about BUSINESS PLAN NOT JUST A RESEARCH PAPER...

Here is the question you should answer...Section A to F...

(Please try to answer every single thing if possible...)


Section VII. Operation Plan
The operations section outlines how you will run your business and deliver value to your customers. Operations is defined as the processes that deliver your products/services to a customer or user and can include the production process for delivering your service to a given customer, manufacturing process if you are a manufacturer, transportation, logistics, travel, printing, consulting, and after-sales service. It also includes such factors as plant location, the type of facilities needed, space requirements, internal processes, capital equipment requirements, and labor force (both full-and ??"part time) requirements.

A service business may require particular attention to location (proximity to customers is generally a must), the service delivery or merchandising system, minimizing overhead, and obtaining competitive productivity from a labor force. In many cases, up to 80% of your expenses will be for operations, 80% of your employees will be involved in operations and 80% of your time will be spent worrying about operating problems. You will probably have to make trade-offs with your operations---it is impossible to have the lowest costs, highest quality, best on-time delivery and most flexibility in your industry all at the same time. This is where you have to make trade-off decisions that fit your other plans.



A. Operating Model and Cycle:

1. Outline the operations process for your business. Identify the inputs, operations (key steps or stages) and outputs (present a flow diagram). This is a day in the life of actually producing your product or creating and delivering your service---walk us through the machines of doing so.

2. Distinguish your model for managing front stages vs. back stage operations.

3. Where are you likely to have bottlenecks in your service delivery or manufacturing process and how will these be anticipated and addressed.

4. Describe the lead/lag times that characterize the fundamental operating cycle in your business.

5. Explain how any seasonal production loads will be handled without severe dislocation (e.g., by building to inventory using part-time help in peak periods).

6. What quality consistency issues exist and how will consistency of quality is ensured? What controls exist, for example, to ensure every burger is cooked exactly same?



B. Operation Strategy:

1. Describe the management of the manufacturing processes involved in production of your products-what will you do-in house and what will you purchase (i.e. make vs. buy decision) or outsource? Or Describe the service delivery processes involved in providing your services and any aspects of the service that are outsourced or provided by others.

2. Justify your proposed make-or-buy policy in terms of inventory financing, available labor skills, and other non-technical questions, as well as production, cost, and capability issues.

3. Discuss who potential subcontractors and suppliers are likely to be and any information about, or any surveys that have been made of, these subcontractors and suppliers. Discuss relationships with them.

4. Describe your approach to quality control, production control, inventory control, and explain what quality control and inspection procedures the company will use to minimize service problems and associated customer dissatisfaction. How will you win in the markt place on cost, quality, timeliness, or flexibility?



C. Geographic Location:

1. Describe the planned geographic location of the business. Include any location analysis, site selection etc. that you have done.

2. Discuss any advantages or disadvantages of your locations in terms of such factors as labor (including labor available, whether workers are unionized, and wage rate), closeness to customer and/or suppliers, access to transportation, state and local taxes and laws (including zoning regulations), access to utilities, and so forth.



D. Facilities, Equipment and Improvements:

1. Describe the facilities, including plant and office space, storage and land areas, special tooling, machinery, and other equipment needed to conduct business. Discuss any economies to scale.

2. Provide a schematic diagram of the layout of your facility.

3. Describe how and when the necessary facilities to start production will be acquired.

4. Discuss whether equipment and space will be leased or acquired (new or used) and indicate costs and timing of
such actions and how much of the proposed financing will be devoted to plant/equipment.

5. Discuss how and when, in the next three years, office/retail site/plant space and equipment will be expanded to the capacities required by future sales projections and any plans to improve or add to existing space or move the facility; indicate the timing and cost of such acquisitions.



E. Capacity Levels and Inventory Management:

1. Discuss your capacity (total volume that you can handle in a day or week)

2. Explain your approach to inventory levels of key products.

3. Present a plan for operations that shows cost/volume information at a typical sales or production level with breakdowns of applicable material, labor, purchased components, and overhead, and that shows the inventory required at these various sales levels.



F. Legal Issues Affecting Operation:

1. Describe any particular legal issues affecting your operations. As example, in a food service operations, certain permits and venting are required; in a production operation with outsourced production, there are legal issues governing the outsourcing agreement; when selling through a manufactures rep or a retail channel there are legal issues affecting the distribution agreement; when setting up a franchise system there are legal issues tied to the franchising agreement; when selling something on a university campus there are legal constraints in operating on the campus; when operating in certain countries there may be some legal or regulatory issues that require attention, and so forth. Note that legal issues affecting intellectual property are handled in the Design and Development section.





**I'm gonna send you additional files including the paper I already done (This gonna give you the big picture)

**Please use WEB RESOURCES not BOOK SOURCES if possible***

Thanks...
There are faxes for this order.

1)Visit the Preferred Tool and Die Company at http://www.preferredtool.com/about_phototour.htm and take the virtual tour.
What process elements at Preferred Tool and Die, Inc. allow them to operate a JIT system? Highlight anything else that interested you about the Preferred Tool and Die Company.

2)Imagine you are a manager at a Just-in-Time manufacturing plant, and you are concerned about parts arriving on time. Visit the Roadway Express Web site at www.roadway.com.
Describe Roadway's solution. Do they offer any innovative approaches to this situation?

3)Theres and interesting article on Inventory Control at Entrepreneur.com. Read the article and highlight what was of interest to you.
http://www.entrepreneur.com/management/operations/inventory/article21842.html
(Short Paragraph)

4) Please visit the following website and read the article: The Risks of Being Just-In-Time. Share your thought about the risks vs the advantages of using a Just-In-Time system.
http://www.inventorymanagementreview.org/2005/10/the_risks_of_be.html

5)***If enough room***
Visit TOYOTA MOTOR MANUFACTURING, KENTUCKY VIRTUAL TOUR at
http://www.toyotageorgetown.com/vtour/vtour.asp.

Answer the following question: (also highlight anything that interested you or observations that you made)

1.) How does the Toyota method of die storage and exchange support their lean production system?