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TIPS FOR CONTROLLING INVENTORY COSTS The following are some tips that can be used to control inventory costs. Implement a cycle-counting process. Cycle counting is a mandatory process for our subassemblies due to implementation of Foreign Trade Zone status, explained a materials control/foreign trade zone coordinator at a major manufacturer of electronic components. [The process] was then expanded to include our material inventory and finished goods inventory, she continued. Through tracking for FTZ, we saved $12,000 per month on duty, and we have improved material inventory by 0.36% variation in the last six months, and finished goods by 0.54% variance during the same time period. Conduct ABC (80/20) analysis and install a demand-pull system from suppliers. A materials manager at a small manufacturer of commercial materialhandling equipment told of introducing the ABC classification process to the company s inventory. Once we completed our ABC analysis, we determined that the top 80% of inventory dollars were invested in 10% of the parts we purchased, he expressed. However, our C items, where we tended to spend most of our time, made up only 5% of dollar value, but represented 75% of the part numbers. They immediately refocused their efforts and began to more tightly manage the A inventory. For the C items, he explained, We now purchase C items once per year under a blanket order, and have specified



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4. Choose File Import File. Locate a video clip and click Open. We used a video clip called Cruising. You can find this clip in the 23 folder on the CD-ROM that accompanies this book.





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This estimates a density conditional on the event that the queue returns to state 0. The kernel density has the same interpretation, having been computed based only on sample paths that returned to state 0. Since some of the waiting times are extremely long, any simulated queue value that did not return by time 10,000 was declared to be unreturned. Even with this cutoff, simulation of this network took on the order of hours, whereas the owgraph analysis took minutes. For additional details on this simulation, see Butler and Huzurbazar (2000). Example 9.4: M/M/c In nite Queue: Mixing Over Stationarity and NonStationarity. This example considers the in nite-state queue with c = 2 and a posterior that places substantial weight over both the stationary portion of the parameter space S = {( , ) : 2 } and the nonstationary portion S c . We obtain the independent posteriors |D Gamma(15, 8) and |D Gamma(15, 12). We obtained 400 posterior samples from these posteriors. The prediction can be summarized with the calculation of three posterior probabilities and three posterior

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And there was still another problem American futures exchanges, anchored as they were in a not-for-pro t membership structure, did not have the agility or capital to compete against the formidable global competitors mounting the attack This brought into focus the idea of demutualization, a process of converting a not-for-pro t membership organization into a forpro t corporate structure Richard Sandor, an esteemed market observer who was instrumental in developing nancial contracts at the CBOT and who launched Chicago s and the European Climate Exchanges, summed it up succinctly: Mutual forms of ownership are not a twenty- rst century way of doing business Speed and exibility are business assets, and mutuals have neither 2 The New York Stock Exchange and the Nasdaq Stock Exchange were talking about demutualization So were the CBOT and CBOE So was almost everyone.

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The NASD, parent of the Nasdaq stock market, reportedly said its board had approved plans that could involve selling shares in its exchange to participant brokers and eventually to the public3 In some places it had already happened: The Stockholm Stock Exchange became the rst stock exchange to convert, and the Australian Stock Exchange was a close second Steven Strahler of Crain s Chicago Business summed it up: The industry s buzzword is demutualization Institutions from the NYSE on down are studying it, converting from member-driven organizations into less democratic but potentially more competitive and technologically advanced corporations that could go public and list their own stock The established exchanges are being forced to react to rival upstarts that are busting open what for decades has been a cozy, members-only club Unfortunately, it may already be too late for many existing exchanges.

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