GLOBAL RELATIONS BETWEEN INVENTORY, MANUFACTURING LEAD TIME AND DELIVERY DATE PROMISES

This paper reports a study of the inventory, lead time and delivery pr omise data from the Global Manufacturing Research Group. It finds that manufacturing lead time increases as work-in-process inventory increa ses, as theory suggests. Also, many companies promise delivery in less time than it takes to produce the product, and the difference is not explained by finished goods inventory. The research also shows that th e chief benefit of JIT, for those few firms that are achieving benefit s, seems to be reduced raw materials.