Total Vendee Cost: An Economic Model for Just in Time

Abstract

The advantage of a Just in Time (JIT) manufacturing and delivery system is the minimization of production costs by reducing the manufacturer's inventory and work-in-process to near zero. The cost savings of a JIT manufacturing and delivery system can be quantified. This paper outlines an economic model to calculate the expected total cost to the manufacturer in a fully integrated Just in Time (JIT) delivery and manufacturing environment. A brief description of the advantages and applications of a Just in Time (JIT) system is provided initially. This discussion highlights the importance of quality, quantity and a timely delivery of supplies to a JIT system. These important variables are incorporated into the economic model and the resulting mathematical model provides the manufacturer a quantitative method for evaluating the Just in Time (JIT) system and the JIT supplier. The individual cost constituents of the model are defined and discussed in detail, including the method of collecting or locating the needed data in the structure of a typical corporate accounting system. Some methods for minimizing the cost components in a JIT system are discussed. A learning curve analysis is provided to illustrate the expected decrease in the unit cost and the quality-related costs as the JIT system reaches a steady state operation. Several flowcharts illustrate how the model should be used to quantify the benefits of a JIT system. The paper concludes with an analysis of the cost of implementing and using the proposed model versus the expected benefits.

Notes

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Graduation Date

1989

Semester

Summer

Advisor

Swart, William W.

Degree

Master of Science (M.S.)

College

College of Engineering

Department

Industrial Engineering and Management Systems

Format

PDF

Pages

82 p.

Language

English

Length of Campus-only Access

None

Access Status

Masters Thesis (Open Access)

Identifier

DP0026691

Subjects

Dissertations, Academic -- Engineering; Engineering -- Dissertations, Academic

Accessibility Status

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