The Study on Applying Incentive System for Just in Time Delivery

JIT 자재 조달을 위한 인센티브제도 적용에 관한 연구

This paper considers how to structure the incentive system between a buy and a single supplier of raw materials when early shipments are forbidden. And this paper is used to take the supplier's behavior into account in the buyer's choice of incentives. Combinations of two types of incentives that the buyer might offer are considered : (1) a fixed value incentive and (2) an incentive that decreases in value as time elapses. Given a desired probability of on time delivery, optimal incentives are found by specifying indifference curves for on time delivery and assessing the expected total cost of incentive schemes along that curve. Difficulties of using incentive to achieve 100% on time delivery are considered and two example flow time distributions are presented.