Just in Time Strategy

Just in time strategy

Introduction

the objectives of this presentation is to introduce the concept of "JIT" and its efficiency in cost-effective operation in both product and service manufacturing. This strategy is widely used nowadays due to its ontime delivering of the right product/service at the time of its demand. This is a system that is highly used in many industries. In this essay we will see the example of the most common industry using JIT manufacturing, the automobile industries and explain why this method is so effective and widely accepted.

Definition/ General Description

Just-in-time method is based on the total elimination of waste, producing goods and services only when needed withought having to store inventory or have the customer waiting for the product/service. In other words, it is based on producing only the necessary parts in the necessary quantities at the right time by matching the production rates with the market demands at that time. Due to the fact that the materials arrive just in time for manufacturing, there is no need for storing inventory as mentioned previously. By these we can see that it operates at low cost and in reality generates profits. The "JIT" method has a positive effect on productivity and work performance and it's overall cost-effective. The most common industry using JIT manufacturing is the automobile industries. I

"JIT" and Toyota Production Systems History

The idea of JIT manufacturing goes back to the Toyota motor company in Japan. Before using JIT manufacturing in Japan, Toyota had studied American production methods such as Ford's practices. In Japan JIT manufacturing is named Toyota Production System. After the Second World War, the Japanese automotive manufactures had acknowledged that they were far behind the American motor companies. The president of Toyota had made a comment about the gap, "Catch up with America in three years, otherwise the automobile industry of Japan will not survive." Toyota had realized that they could not follow the same manufacturing technique as American companies because of their differences in space, resources, and demand. At that time, the American auto manufacturers had used the traditional way of batch production. To do this they had ordered enough parts to complete the batch, and then stocked cars and materials. After many failures, Toyota had come up with a system that would better fit Japan's capabilities. The whole idea is based on the elimination of waste principle. Limiting setup time had become a key factor in the Toyota Production System, since setup time is also down time in which production lines stops and employees get paid for waiting. To decrease the setup time, Toyota had reengineered machines so that optimal setup time could be achieved. Toyota has always been one of the most successful companies because of applying the JIT principles.

Characteristics/Objectives of "JIT"

The Implementation of JIT takes time and commitment from all levels in the company and must be carefully planned in big companies such as Toyota. An overall objective of JIT is to limit resources used in the manufacturing system in order to improve efficiency. Some of the specific areas that could be corrected to improve efficiency of producing cars are:

*Overproduction (waste from producing more cars than is needed)

*Transportation (waste such as that associated with moving items around a factory)

*Processing time (waste such as that associated with spending more time than is necessary processing cars on a machine)

*Time spent waiting (waste such as that associated with a worker or a robot being idle)

*Inventory (waste associated with keeping stocks of cars)

*Defects (waste associated with defective components)

There are six other objectives that are of high importance for obtaining the overall objective. These objectives need to be taken into consideration by companies that want to integrate JITsystems, and are highly important for a successful integration.

*Optimize each step of the manufacturing system process. In other words make each step as efficient as possible to get the most from the least.