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MET 4463 – MANUFACTURING MANAGEMENT
– Summer I 2000
(MINI-SESSION)
Professor: Dr. Larry
Roderick (254-968-9014), e-mail Roderick@tarleton.edu Text: “Operations
Management” by Russell and Taylor, 3rd ed.
Class: Will meet from 5:00 pm to 8:00 pm on TTVN from May 17 to June
2. Course
Objectives: To introduce the student to the elements of manufacturing operations,
including such topics as quality, design for manufacturability, group technology,
production control strategies, synchronous manufacturing, concurrent engineering, flexible
manufacturing, utilized to effectively manage the manufacturing environment. |
Session
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Date
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Topic
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Chapter
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Exam
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1
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5-17
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Introduction
& Quality Management
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Notes
& 1
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-
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2
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5-18
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Quality
Management
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3
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1
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3
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5-19
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Product
Design
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5
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-
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4
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5-22
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Process
Planning
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6
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2,3
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5
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5-23
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Facility
Layout
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7
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4
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6
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5-24
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Work
Design/Measurement
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8
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5
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7
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5-25
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Aggregate
Production & Capacity Planning
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11
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6
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8
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5-26
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Inventory
Management
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12
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-
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9
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5-29
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Holiday
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-
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-
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10
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5-30
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Materials
Requirements Planning
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13
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7,8
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11
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5-31
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Scheduling
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14
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9
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12
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6-01
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JIT
& Continuous Improvement
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15
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10
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13
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6-02
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Final
(4:00 pm)
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ALL
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Grading:
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A 89.5–100
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B 79.5–89.4
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C 69.5–79.4
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D 59.5–69.4
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F Below 59.5
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Grade
Calculation:
10 grades @ 10% each (the lowest grade will be dropped).
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Criteria: The goal is for 10 daily exams to be given. Each
exam will cover material presented the previous night.
The (1) lowest grade will be dropped. Because of the compressed time and distances,
no make-up exams will be given. A missed exam will be the “dropped”
grade.
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Final:
A comprehensive
final (optional) will be
given for those students desiring to raise their grade.
The final will count as 25% of the final grade, with the other 10 daily exams
counting as 75% of the final grade. The final will not lower your grade.
Note: The chapter numbers are the same for both editions 2 & 3.
The exam scheduled for the 19th will be delayed until the 22nd. Both exams 2 and 3
will be given on the 22nd.
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The exam scheduled for the 26th will be delayed until the 30th. Both exams 7 and 8
will be given on the 30th.
Chapter 12: Inventory Management (NOTES)
NOTE: Please read all sections of the chapter except:
The EOQ Model With Noninstantaneous Receipt
Computer solution of EOQ models with Excel
Quantity discounts
Quantity discounts with constant carrying cost
Quantity discount model solution with POM for windows
Reorder point with variable demand
Determining the reorder point with excel
Order quantity for a periodic inventory system
Order quantity with variable demand
Determining the order quantity for the fixed-order model with excel
INVENTORY
 | Stock of items held to meet future demand
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| Inventory Management answers 2 questions
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How much to order
When to order
TYPES OF INVENTORY
| Raw materials
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| Purchased parts and supplies
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| Labor
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| In-process (partially completed) products
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| Component parts
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| Working capital
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| Tools, machinery, and equipment
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| Finished goods
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REASONS TO HOLD INVENTORY
| Meet unexpected demand
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| Smooth seasonal or cyclical demand
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| Meet variations in customer demand
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| Take advantage of price discounts
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| Hedge against price increases
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| Quantity discounts
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ABC CLASSIFICATION SYSTEM
| Demand vollume & value of items vary
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| Classify inventory into 3 categories
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Class
% of Units
% of Dollars
A
5-15
70-80
B
30
15
C
50-60
5-10
(see example 12.1)
TWO FORMS OF DEMAND
| Dependent (items used to produce final products)
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| Independent (items demanded by external customers)
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INVENTORY COSTS
| Carrying Cost (cost of holding an item in inventory)
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| Ordering Cost (cost of replenishing inventory)
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| Shortage Cost (temporary or permanent loss of sales when demand cannot
be met)
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INVENTORY CONTROL SYSTEMS
| Fixed-Order-Quantity System (Continuous)
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constant amount ordered when inventory declines to predetermined
level
| Fixed-Time-Period System (Periodic)
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order placed for variable amount after fixed passage of time
THE INVENTORY ORDER CYCLE
(see figure 12.1)
ASSUMPTIONS OF BASIC EOQ MODEL
| Demand is known with certainty
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| Demand is relatively constant over time
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| No shortages are allowed
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| Lead time for the receipt of orders is constant
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| The order quantity is received all at once
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let
Q= an order
quantity (size)
D=
annual demand
C(O)=
cost of placing one order
C(C)=
annual per-unit carrying cost
then,
the
number of orders per year = D/Q
the
average order size = Q/2
(see
figure 12.2)
(See Example 12.2)
SAFETY STOCKS
| Safety Stock - buffer added to on hand inventory during lead time
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| Stockout - an inventory shortage
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| Service Level - probability that the inventory available during lead
time will meet demand
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(see figure 12.6)
CHAPTER 15
JUST-IN-TIME SYSTEMS
What is JIT?
| Producing only what is needed, when it is needed
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| A philosophy
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| An integrated management system
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| JIT's mandate: Eliminate all waste!
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"Waste is anything other than that which adds value to
the product or service"
Basic Elements of JIT
Flexible resources
Cellular layouts
Pull production system
Kanban production control
Small-lot production
Quick setups
Uniform production
Quality at the source
Total productive maintenance
Supplier networks
Examples of Waste
| Watching a machine run
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| Waiting for parts
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| Counting parts
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| Overproduction
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| Moving parts over long distances
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| Storing inventory
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| Looking for tools
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| Machine breakdown
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| Rework
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Flexible Resources
| Multifunctional workers
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| General purpose machines
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| Study operators & improve operations
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Cellular Layouts
| Group dissimilar machines in manufacturing cell to produce family of
parts
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| Work flows in one direction through cell
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| Cycle time adjusted by changing worker paths
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Kanban Production Control System
| Kanban card indicates standard quantity of production
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| Derived from two-bin inventory system
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| Kanban maintains discipline of pull production
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| Production kanban authorizes production
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| Withdrawal kanban authorizes movement of goods
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Types of Kanbans
| Kanban Square: marked area designed to hold items
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| Signal Kanban: triangular kanban used to signal production at
the previous workstation
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| Material Kanban: used to order material in advance of a process
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| Supplier Kanbans: rotate between the factory and suppliers
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Small-Lot Production
| Requires less space & capital investment
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| Moves processes closer together
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| Makes quality problems easier to detect
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| Makes processes more dependent on each other
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SMED Principles
Separate internal setup from external setup
Convert internal setup to external setup
Streamline all aspects of setup
Perform setup activities in parallel or eliminate them entirely
Reducing Setup Time
| Preset desired settings
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| Use quick fasteners
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| Use locator pins
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| Prevent misalignments
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| Eliminate tools
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| Make movements easier
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Uniform Production
| Results from smoothing production requirements
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| Kanban systems can handle +/- 10% demand changes
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| Smooths demand across planning horizon
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| Mixed-model assembly steadies component production
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Mixed-Model Sequencing
Model Monthly
demand Daily
demand
Small
1200
40
Midsize
2400
80
Luxury
2400
80
Sequence of L-M-S-M-L repeated 40 times per day maintains proper mix of
models
Quality At The Source
| Jidoka is authority to stop production line
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| Andon lights signal quality problem
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| Undercapacity scheduling allows for planning, problem solving &
maintenance
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| Visual control makes problems visible
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| Poka-yoke prevents defects
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Kaizen
| Continuous improvement
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| Requires total employment involvement
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| Essence of JIT is willingness of workers to:
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spot
quality problems
halt
production when necessary
generate ideas for
improvement
analyze problems
perform different
functions
Total Productive Maintenance (TPM)
| Breakdown maintenance: repairs to make failed machine operational
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| Preventive maintenance: system to periodic inspection & maintenance
to keep machines operating
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| TPM combines preventive maintenance & total quality concepts
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TPM Requires Management To
| Design products that can be easily produced on existing machines
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| Design machines for easier operations, changeover, maintenance
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| Train & retrain workers to operate machines
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| Purchase machines that maximize productive potential
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| Design preventive maintenance plan spanning life of machines
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Trends In Supplier Policies
Locate near to the customer
Use small, loaded trucks and ship mixed loads
Consider establishing small warehouses near to the customer or
consolidating warehouses with other suppliers
Use standardized containers and make deliveries according to a precise
delivery schedule
Become a certified supplier and accept payment at regular intervals
rather than upon delivery
Benefits of JIT
Reduced inventory
Improved quality
Lower costs
Reduced space requirements
Shorter lead time
Increased productivity
Greated flexibility
Better relations with suppliers
Simplified scheduling and control activities
Increased capacity
Better use of human resources
More product variety
JIT Implementation
| Use JIT to finely tune an operating system
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| Somewhat different in USA than Japan
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| JIT is still evolving
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| JIT isn't for everyone
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