Mba/550 Managing Inventory in a Supply Chain Worksheet Assignment

Topics: Inventory, Working capital, Forecasting Pages: 2 (581 words) Published: January 25, 2009
Working Capital Management Concepts Worksheet
ConceptApplication of Concept in the SimulationReference to Concept in Reading


Kuiper Leda Inc. in the Republic of Novamia is an electronic components manufacturer, who specializes in the production of ECUs and automotive industry sensors. The company has grown significant in the last two years resulting in a high demand for their products. By using JIT inventory systems, Kuiper Leda can produce the needed products and save inventory through carrying costs. Inventory control will be essential to Kuiper Leda success. "Just-in-time manufacturing uses classical production –consumption inventory designed to integrate activities to achieve high-volume, high-quality production using minimal inventories of raw materials, work-in-process, and finished goods." (Chase, Jacobs, Aquilano, p. 589, 2005)

Forecasting and time series analysis

In order to meet customer demand, Kuiper Leda should forecast the needed changes in the production process. Forecasting is vital for Kuiper Leda since it will enable the management team to make sound decisions regarding products, schedules, staffing, and production. Using this system will allow Kuiper to use a time series analysis as part of the forecast inventory management process which will allow the most effective means of forecasting. "time series analysis, is based on the idea that data relating to past demand can be used to predict future demand or cyclical influences" (Chase, Jacobs, & Aquilano, p. 513, 2005) Demand Management

Kuiper Leda recently received a large order for electronic control units. The increased order for these ECUs is based on orders placed by the vendor. The company will not increase the number of ECUs produced without documentation which supports the demand. Demand management allows the company to use inventory management more effectively, cash conversion cycle and cost of goods. "Dependent demand is the demand for a product or...

References: Chase, R., F, Jacobs, R., & Aquilano, N., (2005) Operations Management for Competitive Advantage. New York: McGraw-Hill Companies.
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