Automated Inventory Replenishment System at Henderson Air
What is an example of a company with a computerized inventory system?
Once a day, Henderson's computerized inventory system monitors the number of bolts and other fasteners the company needs to maintain production. If the amount of any type of fastener in inventory dips below preset standards, the computer automatically sends an order for more fasteners to Acme Fastener and Tool. This is an example of:
A. Just-in-time delivery method
B. Automated inventory replenishment system
Answer:
The automated inventory replenishment system at Henderson Air is an example of a:
B. Automated inventory replenishment system
Explanation:
The case of Henderson Air's inventory system is an example of an automated inventory replenishment system, which is conceptually related to the just-in-time (JIT) delivery method. In this scenario, the system monitors the number of fasteners required for production and, when levels fall below a preset threshold, it automatically places an order with Acme Fastener and Tool. This is quite similar to how just-in-time delivery systems work, which were popularized by Japanese manufacturing processes and later adopted globally. The just-in-time approach minimizes inventory costs and can improve quality control, as it enables immediate detection and response to defects. Factories must maintain excellent relations with suppliers and require them to be located within one day's drive in order to facilitate this system. While JIT can put pressure on wages and benefits, it simultaneously provides opportunities for workers to exercise significant leverage by going on strike, as demonstrated in the Dayton, Ohio example.