Question

Consider consecutive processes A-B-C, where process A has a capacity of 25 units per hour, process B has a capacity of 30 units per hour, and process C has a capacity of 20 units per hour. In addition to having an inventory buffer in front of the final product (also known as finished goods), where would an operations manager, who practices the principles of Theory of Constraints, want another inventory buffer?
a. in front of process A

b. in front of process B

c. in front of process C

d. Inventory should not exist anywhere.

Answer 1

Answer:

Right option is C.

Explanation:

The operation manager will put the inventory in front of the process C. So, the right option is C.

As we have given the outputs of these processes:

Process A = 25 units/hr

Process B = 30 units/hr

Process C = 20 units/hr      Lowest output among all processes.

As, we can see that the process C has the lowest output of all which is 20 units per hour. It clearly means that operation manager will utilize the low output of process C and put the inventory infront of process C in order to increase the output of the overall process.