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And a third issue comes from the view that inventory also serves the function of decoupling two separate operations. For example work in process inventory often accumulates between two departments because the consuming and the producing department do not coordinate their work. With improved coordination this buffer inventory could be eliminated. This leads to the whole philosophy of [[Just In Time (business)|Just In Time]], which argues that the costs of carrying inventory have typically been under-estimated, both the direct, obvious costs of storage space and insurance, but also the harder-to-measure costs of increased variables and complexity, and thus decreased flexibility, for the business enterprise.
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==Equations==
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