Inventory Management and Lean Production

Why do businesses hold inventories?

• To reduce operational space

• To meet customer demands and avoid supply issues

• To increase costs and risks

• To reduce storage requirements

Which of the following is NOT a type of inventory?

• Raw materials

• Land

• Part-made goods

• Finished products

What is one disadvantage of holding too much inventory?

• Reduced working capital

• Fewer production delays

• Improved economies of scale

• Reduced insurance costs

Which is a key feature of Just-In-Time (JIT) production?

• Buying in bulk to save costs

• Inventory arrives only as and when needed

• Holding large reserves of stock

• Offering insurance to suppliers

What is an advantage of Just-In-Time production?

• What is an advantage of Just-In-Time production?

• Risk of production delays

• Lower storage costs

• Increased risk of obsolescence

What does "Kaizen" emphasize?

• Holding inventory for longer durations

• Many small changes for continuous improvement

• Delegating tasks to a single individual

• Reducing costs through mass layoffs

What is one benefit of team working (cell production)?

• Decreased employee motivation

• Less inventory space needed

• Employees organize their own work

• Employees organize their own work

How does lean production help reduce costs?

• By increasing storage needs

• By lowering rent through reduced space usage

• By hiring more employees

• By increasing production delays

Which of the following is NOT a benefit of lean production?

• Reduced warehouse space

• Reduced risk of obsolescence

• Increased inventory levels

• Lower unit costs

Why does lean production improve employee motivation?

• Employees can work less efficiently

• Employees feel involved in improving processes

• Employees are allowed to work unsupervised

• Employees are not required to innovate