Just-In-Time (JIT) is an inventory system used by Gilbarco. With Just –In-Time production and the purchase of materials do not begin until a customer places an order for a product.. This allows Gilbarco to shrink their inventories to lower quantities or not having any on hand all. JTI has had many direct effects on the following inventories: raw material, work in process, finished goods. Old inventory systems would require the companies to have large quantities of resources to avoid any production problems. JIT allows enough materials to be purchased in order to cover the needs daily.
Gilbarco uses forecasting methods to predict current and future trends. Gilbarco uses the information to determine if the company will break even and if the company does not do well they can decide if the company will be able to maintain production the next year. The index is a point of reference concerning numbers with common points. Indices are used to observe historical and short-term comparisons with percentages change and commonly used. The chart above is example raw data that Gilbarco uses to help forecast the next five years.
The normal distribution is important because it describes the statistical behavior of Gilbarco inventory. The shape of the normal distribution is completely described by the mean and the standard deviation . Normal distribution curve is a statistical function that describes how data behaves around any given mean. Also known as a Gaussian distribution or bell curve, a normal distribution curve allows statisticians to analyze data and make predictions
The measure of dispersion that most accurately depicts inventory data is standard deviation. When you look at measuring dispersion you are looking to see how the entire spread of data actually measures to each other. Standard deviation presents how much the data will deviate from the normal number.
Data Source: University of Phoenix The table above shows the Frequency and Normal Distribution Data during the Winter Season. This was created to show the different results of Mean, Median, Mode, Range, and Standard Deviation.
Exceutive management presentation
KAREN FAITH ADAMS, KAREN JONESQRB/501 – QUANTITATIVE REASONING FOR BUSINESS MARCH 26, 2012 ARI RAHMAN
Introduction Inventory management systems are a vital part of businesses Observing inventory levels is necessary for creating revenue and profits. Mangers need to develop , analyze frequency distributions, locate the mean, median and mode and show a normal distribution of raw data collect
Just-In-Time Inventory System Production and the purchase of materials do not begin until a customer places an order for a product. Eliminates waste and makes the company efficient Companies are able to do away with their warehouses Funds that were tied up in inventories can be used elsewhere Defect rates are reduced, resulting in less waste and greater customer satisfaction
Conclusion Forecast accuracy is a critical component of Gilbarco’s success in today’s markets, particularly when competing on a global scale. Inventory is Gilbarco’s largest asset Forecasting techniques are quantitative. Quantitative techniques of forecasting are best used when changes are infrequent.
• Accounting For Management. (2011). Retrieved fromhttp://www.accountingformanagement.com/just_in_time.htm• University of Phoenix. (2012). Winter Historical InventoryData, University of Phoenix Material.. Retrieved from University ofPhoenix