Decision tools for selecting components for JIT replenishment

Robert B. Johnston and John M. Betts

International Journal of Operational Research, 2006, vol. 1, issue 4, 323-339

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. (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijores:v:1:y:2006:i:4:p:323-339

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