ABSTRACT

Before we have a look at what the motor manufacturers have been doing, let’s have a look at TPS as applied to inventory reduction.

roughout his working life, Ohno was really only interested in one issue, that of the time taken from a customer placing an order to the company receiving the money for the goods sold (Ohno, 1988; and see Figure 4.1). Delays in the time taken from customer order to cash received result in waste to the company. Minimizing time to cash cannot be fully achieved without Žrst addressing all waste issues. Most, if not all, internetbased companies have realized the value of time to cash and exploit it to full advantage. ey do this by charging a credit card when the order for goods is placed. In this way, the company has your money before you have the goods. e really smart internet companies buy the components to manufacture the product that they have just sold a¢er they have taken your money. ey use the customer’s money to fund their own business, o¨en delaying payment for their own suppliers for as long as possible.