Petro Automotive,
a major manufacturer of auto parts based in Texas, has just learned about the...

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Petro Automotive, 
a major manufacturer of auto parts based in Texas, has just learned about the Toyota production system and wants to implement JIT. Traditionally there has been no control on the amount of work in progress (WIP) inventory between stages (it has been known to exceed 500 parts between some stages). Following numerous consultant's zero inventories advice, Petro Automotive is considering as a first step to limit the amount of work in process inventory between stages to a maximum of 5 parts. a) What, if any, impact will this decision have on the output rate from the factory in the short term?

Jose · Accepted Answer

Process Improvement  
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a) What, if any, impact will this decision have on the output rate from the factory in the short term?
While analysing the case we can understand that the amount of work in process inventory is limited between stages to a maximum of 5 parts. By doing this the company can make changes in output rate from the factory. The output rate from the factory increases and it provides lots of benefits to the company.

Petro Automotive, a major manufacturer of auto parts based in Texas, has just learned about the Toyota production system and wants to implement JIT. Traditionally there has been no control on the...

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