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CIPS L4M6 Exam - Topic 1 Question 14 Discussion
Topic #: 1
Agile Cars Ltd is creating a 'lean' business model which involves receiving deliveries of components only when they are required. Which of the following 'wastes' is being removed from the business?
This would reduce inventory (holding stock). Inventory is considered a business waste because it costs money to store stuff (e.g. paying the rent on a warehouse, electricity to light it up etc). If you can reduce the need to store materials and components on site- you reduce costs. You also save time because you get deliveries when you need them- you don't need to allow for staff unpacking things, storing them away, then going back to them later when they need them. For more information on the 7 Business Wastes see p.70. This comes up in a couple of modules, so it's worth remembering.
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