Introduction:Ø JIT, in time concept, was initiated in Japan byToyota Ø In JIT goods are purchased and produced asand when required (Assemble To Order (ATO)). Ø JIT production system identifies the hidden problemsin the value chain and reduces the production waste of the system. In Zest: Just-In-Time (JIT) manufacturing is a Japanese managementphilosophy applied in manufacturing, which involves-right items of rightquality and quantity in right place and at right time.The blueprint of JIT involves the following 3 elements:1. People involvement- Itplays a vital role in reducing the amount of time and effort involved in implementingJIT and helps in minimizing the likelihood of creating implementation problems.Following groups should be seeked for support and agreement: i. Stockholdersand owners of the company- Their support is required to re-invest the short-termearnings back into the company to finance the various changes and investmentcommitments necessary for JIT success as emphasis should be laid on long-term realizationof profit.
ii. Labourorganization- All employees and labour unions need to beinformed about the goals of JIT and made aware of how the new system willaffect/change the working practices. It is vital in winning the union and worker’ssupport to assist with the implementation and to remove potential problems and difficulties. iii. Managementsupport- This involves the support of management fromall levels. It is the management’s attitude that helps in inheriting the continuousimprovement and is not only required of the employees on the shop floor.
2. Plants- Major and numerous changes occur about the plant whichincludes plant layout, multi-function workers, demand pull, Kanban,self-inspection, MRP (material requirements planning) and MRP II (manufacturingresource planning) and continuous improvement. i. Plantlayout- Idea is to maximise worker flexibility and thelayout is according to product rather than process. This type of layout requiresthe use of ‘multi-function workers’ i.e. the focus shifts towards trainingworkers and providing them with the skills necessary to perform many tasksrather one or two highly specialized tasks.
ii. DemandPull production-The concept of “demand-pull” involves the useof demand for a given product to initiate the production process. It alwaysallows a company to produce only what is required in the right quantity and atthe right time, thereby reducing inventories. iii.
Kanban- Japaneseword, meaning signal. It is usually a card or tag accompanying products throughoutthe plant. Kanbans include the name or serial number for productidentification, the quantity, the required operation and the destination ofwhere the part will move. It helps in linking the different productionprocesses together.
iv. Self-inspection/TotalQuality Management- The use of self-inspection by employees isdone to ensure that their production input adds value to the product and is ofhigh quality (Total Quality Management(TQM)). Self-inspection allows faults and poor quality work to be caughtand corrected efficiently at the place where the fault initially occurs. v.
Continuousimprovement (Kaizen) – Continuous improvement is an integral part ofJIT concept and, to be effective, must be adopted by each member of theorganization (not only by those directly with the production processes). Itrequires that with every goals and standard successfully met, these goals andstandards should be increased but always in a range that is reasonable and achievable.This allows the company to constantly improve.3. Systems/Technology-Activities and materials used in production arelinked, planned and co-ordinated with the help of technology and systems. Twosuch system are MPR and MRP II. i. MRP is”a computer-based method for managing the materials required to carry out aschedule”.
It is a ‘bottom up’ or ‘consolidation’ approach to planning, i.e. itinvolves the planning of lower level products within the product family such ascomponent parts. Planning for MRP can be broken down to i)production plan, which is a broad plan indicating the availablecapacity and the means in which it is to be allocated about the plant, and ii)master production schedule which is adetailed plan of what products to produce in specified time period. ii. MRPII is a computer-based programme, can be used to provideinformation on financial resources available to carry out the plans of MRP. Total quality control is an additionalelement of JIT and is important in ensuring that the quality standards of setproduction is achieved.
JIT quality involves ‘quality at the source’-emphasison producing products correctly the first time. Dos and Don’ts:Do’s:· Continuous improvement.o Creating systems to identify problems and attackingfundamental problemso Making Systems Simplero Product oriented layout o Quality control at source o Poka-yoke – to prevent mistakeso Preventative maintenance, · Eliminating waste. Wastes from:o overproduction.o waiting time.
o transportationo processing o inventory o motion.o product defects.· Good housekeeping .· Set-up time reduction – increasing flexibility and allowing smallerbatches· Kanbans · Jidoka (Autonomation) – Artificial IntelligenceDon’ts:· Avoid suppliers at farther distances so the risk of not meeting the ontime delivery can be avoided.· Do not work in Silos.1. Offer early payment incentives.
– Example 0.5% 15,net 45. It means that customer can save 0.5% on the total invoice for paying itin 15 days instead of 452. Inventory Management: Techniques like JIT, VMI can help.3. Reducing or Shortening the operating cycle4.
Automate Accounts Receivableand Payment Monitoring: Makes the collection teams on toesto chase delinquent customers.5. Leasing the equipment-It can be financially unwise to investin new equipment. Leasing is a way to avoid making huge investments tostay at par with the technological innovations.