The taxpayer adopted the JITM on a cell-by-cell basis to increase its productivity and competitiveness.
The Service found that the reconfiguration of the plants allowed the taxpayer to use its existing equipment in new and more efficient ways, and that the costs were part of an overall plan, capital in nature, to convert the taxpayer's facilities to the JITM.
The Service viewed the conversion to the JITM as a "radical redesign of, and a fundamental change in" the business processes at the taxpayer's manufacturing facilities.
The taxpayer also incurred costs for materials and supplies used to implement the JITM.
By enabling one worker to control many machines at once, the JITM greatly improves productivity and the ability to deliver a better and less costly product.