Question

Lean Principles The chief executive officer (CEO) of Platnum Inc. has just returned from a management seminar describing the benefits of the lean philosophy. The CEO issued the following statement after returning from the conference: This company will become a lean manufacturing company. Presently, we have too much inventory. To become lean, we need to eliminate the excess inventory. Therefore, I want all employees to begin reducing inventories until we make products "just-in-time". Thank you for your cooperation. To implement lean, a company must first remove the reasons for excess inventory. All of the following are reasons except: a. poor quality b. large setup times c. unreliable equipment d. poor employee relationships e. worker's unions

Answer 1

Answer: Option E

Explanation:

A. Poor quality inventory will not be sold leading to excess of it thus it is a reason.

B. Large set up times will lead to loosing of customers, thus, reason for excess inventory.

C. Unreliable equipment urges for overproduction while the equipment is working efficiently thus it is a reason for excess inventory.

D. Poor employee relationships effects organisation process which might lead to delay in sales thus, a reason for excess inventory.

E. Workers union establishes efficiency in the work performance of labor, thus, it is not a reason in excess inventory.