System model of production inventory control

The primary consequence of just-in-time (JIT) production is reduction of inventory with associated financial benefits. However, existing methods cannot adequately explain the causality that leads to failed (or successful) JIT implementations. This paper describes a fresh theoretical approach to examining the larger organisational factors in which inventory control systems are embedded. A structured descriptive system model for production inventory control is described, including base stock, CONWIP, kanban and hybrid systems. The model was then interrogated to produce lists of tentative critical success factors for implementation of these strategies in JIT and lean production, and propose explanations as to why it succeeds or fails.

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