Final answer:
Firms using JIT/lean production gain a competitive advantage through lower processing costs, increased productivity due to employee specialization, and the realization of economies of scale.
Step-by-step explanation:
The competitive advantage enjoyed by firms using JIT/lean production is mainly attributed to having lower processing costs. By implementing JIT/lean production techniques, companies can reduce waste and improve efficiency. These practices lead to reduced stock levels and minimal holding costs, contributing to lower overall processing costs.
Specialization in employee skills is another factor that contributes to the competitive advantage. Specialized employees can become more proficient at their tasks, leading to higher productivity and, in turn, further reducing production costs. This skill focus aligns with the concept of economies of scale, where the cost per unit decreases as production volume increases - a principle that JIT/lean production models strive to maximize.
The division of labor and specialization in tasks enables businesses to conserve resources, produce at larger scales, and as a result, combat the issue of scarcity. Such a specialized approach to production is part and parcel of achieving economies of scale, which proves advantageous in a competitive marketplace.