THE EFFECTS OF MANUFACTURING LEAD TIME AND PROCESS QUALITY IN A MULTIPROCESS PRODUCTION SYSTEM

Shortened manufacturing lead times (MLT) and high process quality (PQ) are two-important basic rules required for the implementation of just-in-time (JIT) manufacturing. By considering three direct cost items related to the MLT and PQ - the cost of the work-in-process (WIP) inventories, the non-operation cost, and the cost of quality - in the lot size computation, we examine the effects of the MLT and PQ on the optimal lot size and the corresponding total relevant cost (TRC). We analyse those effects by reducing the MLT and by improving Pa and find that applying these two basic rules can reduce inventory levels, produce high-quality products, and increase production flexibility.