Which of these system do you think many company uses more?

| November 24, 2016

Answer the question below and write your answer in order.

1) Which of these system do you think many company uses more? Which will help them save more money?

2) I believe a very important component of the JIT system is initiating production after the order is placed or needed; as you mentioned in your post. This type of JIT ordering keeps materials from just sitting on the shelf waiting for the next order. What if this material is never used or expires or technology lapses?

3) (JIT concept advocates for zero inventory and stock-less production). So how does this affect the use of warehouse? The supply chain in general thrives for a zero-defect rating. If JIT is used for delivery of item being directly sold I can see how more trips are being conducted with possibly smaller supplies hauled. This could work if the vendor is geographically close to the manufacturing company and retail store. What are your thoughts?

Withe the reference essay below.

Supply Chain Innovations

Supply chains innovations have kept the performance of supply chain process as an organization function at the top. Many organizations attribute their success to the effectiveness and efficiency of supply chain process. Innovations enable an organization to remain adaptable to the ever-changing competitive environment. This paper examines supply chain innovations that have enabled proper functioning of supply chain process in organization. These innovations are the Just-in-time concepts and

Just-in-time concept advocates for zero inventory and stockless production. This state is achieved through just-in-time purchasing and just-in-time production (Kim, Cavusgil, & Calantone, 2006).. Companies create a closer and strong relationship with the suppliers and organize for more frequent deliveries of small quantities. The main aim of just-in-time concept is to purchase goods so that deliveries are made prior to their use. It is economical because there is no cost of carrying cost and reduces inefficiencies created by holding inventory. JIT purchasing forces the company to make more frequent orders in small quantities to meet the demand as it arises. Ordering costs increases as the holding cost significantly goes down. However, the total cost is reduced. This innovation offers organization many advantages such as low inventory level, strict quality control, faster market response and lower set up costs.

On the other hand, Material Resource Planning (MRP) focuses on proper management of materials that makes production tasks go more quickly. Accounting systems have facilitated this innovation. With MRP employees are able to look up the status of all necessary material at any given time required for production (Kim, Cavusgil, & Calantone, 2006). Therefore, it is possible to accurately plan and executes daily manufacturing activities. The accounting software enables the management of material for any specific job and for the entire stock of materials owned by an organization. The information is stored in the system in such a way it can be used by all interested parties for effective material management. Therefore, many tasks are connected and refined all together. This concept prevents supply shortages and inventory efficiencies.

References

Kim, D., Cavusgil, S. T., & Calantone, R. J. (2006). Information system innovations and supply chain management: channel relationships and firm performance. Journal of the Academy of Marketing Science, 34(1), 40-54.

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