Markets are organized so that buyers and sellers have a choice of participating in production-to-stock or production-to-order auctions. A production-to-stock (PTS) institution requires the seller to hold inventory before trading. Data from computerized double auctions are analyzed. Inventory cost diminishes trading activity. When the choice of institution is endogenous, sales from stock are about 15 percent of the total. When there is only a PTS market, econometric estimates show sellers as a group seek higher prices and seller surplus is relatively high. A production-to-order choice increases buyer surplus and market efficiency: doing more with less by employing 'lean thinking.' Lean manufacturing involves never ending efforts to eliminate or reduce 'waste' in design, manufacturing, distribution, and customer service processes. Developed by the Toyota executive Taiichi Ohno during post-Second World War reconstruction period in Japan, and popularized by James P. Womack and Daniel T. Jones in their 1996 book 'Lean Thinking.' Also is called lean production. The core idea is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources. A lean organization understands customer value and focuses its key processes to continuously increase it. The ultimate goal is to provide perfect value to the customer through a perfect value creation process that has zero waste. To accomplish this, lean thinking changes the focus of management from optimizing separate technologies, assets, and vertical departments to optimizing the flow of products and services through entire value streams that flow horizontally across technologies, assets, and departments to customers. Lean thinking involves: specify what creates value from the customers perspective, identify all steps across the whole value stream, making those actions that create value flow, making what is pulled by the customer just-in-time, strive for perfection by continually removing successive layers of waste.
International Letters of Social and Humanistic Sciences (Volume 28)
D. Gîfu et al., "Design of a Stable System by Lean Manufacturing", International Letters of Social and Humanistic Sciences, Vol. 28, pp. 61-69, 2014