Keywords: comparison of ford and toyota philosophies
Introduction
A manufacturing/production system consists of a conversion system, which transforms inputs into output. Just how conversion is performed depends upon the nature of product/service and the nature of demand for such product/service. Thus the types of production are broadly classified into two categories, the continuous and the intermittent. The first category is suitable where large scale production is required and the second is suitable where demand is non-uniform and seasonal and the merchandise is not standardized.
Ford Motors, as it is poised for mass producing standardized automobiles, naturally embraced the continuous production system.
Capital budgeting refers to the process in which a firm determines whether a task or investment will probably be worth pursuing. More often than not, the process will involve a long-term assessment of the cash inflow and outflows to ascertain if the profits generated meet up with the investment appraisal. The most common methods used are the world wide web present value (NPV) where evaluation of the task is based on the amount by which its value is maximized. Other methods or tools found in decision making include: the internal rate of come back (IRR), a version of the IRR known as the modified interior rate of return (MIRR), the discounted payback period (DPB), a profitability index method (PI) and the original payback method. Whatever the demerits provided by each, most businesses or financial managers tend to stick to a certain method of capital budgeting.
