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stock control (just in time (stock control system that operates with 0…
stock control
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buffer stock
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buffer stock protects against the risk of disrupted production & workers idling waiting for stock to arrive
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stock control chart
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re-order level - if stock falls to this level, firms will order more stock from the supplier. this level is reached before delivery, as the supplier needs to process the order
minimum stock level - aka buffer stock level, least amount of stock the firm wishes to keep
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just in time
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disadvantages - unreliable suppliers (late delivery, poor quality)
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kaizen - a japanese term for "continuous improvement" - making many small, gradual changes to improve either quality or efficiency
reality of stock control:
in reality stock control diagrams showing a neat pattern is not true. orders may arrive late and may not be of the correct quantity. the rate of usage of stock may not be constant, during busy times stock levels will fall a lot quicker. the benefit of a stock control diagram is that it gives the firm a clear picture of how stock levels have changed and to identify the reasons for these changes
lean production:
JIT is a key part of lean production. this is a philosophy that attempts to eliminate all forms of waste from the production process. by reducing waste, the business can improve efficiency and lower its unit costs. this provides it with a competitive advantage:
- using the ideas of staff through kaizen groups who meet regularly to suggest ideas for improving productivity and quality
- maintaining high levels of quality throughout the production process
- quicker speed of production and development of new products