Title: Decision tools for selecting components for JIT replenishment
Authors: Robert B. Johnston, John M. Betts
Addresses: Department of Information Systems, The University of Melbourne, Victoria 3010, Australia. ' School of Business Systems, Monash University, Victoria 3800, Australia
Abstract: This paper describes two decision tools that allow identification of candidate components for cost effective Just-In-Time (JIT) replenishment. The first is a simple and easily interpreted coefficient, based on component cost and demand parameters, which ranks the importance of adoption of JIT replenishment of components. The second is a procedure that can be used by inventory managers to work from the ranking coefficient to an approximate model for profit and return on investment, for a given level of inventory capitalisation, when the highest priority JIT decisions are implemented cumulatively. We illustrate the use of these tools with a case study.
Keywords: just-in-time; JIT replenishment; inventory management; decision modelling; manufacturing; operations management; component selection.
International Journal of Operational Research, 2006 Vol.1 No.4, pp.323 - 339
Published online: 10 Jul 2006 *
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