The primary goal for the company is customer's satisfaction and if company can not reach perfection in this area then all the processes are worthless. All parts of the value chain and everything in the enterprise must be healthy for realization of competitive business processes. If the company wants strong and long lasting value chain all the links within the chain must be prepared to overpass all existing problems. The principle of Just-in-time is to eliminate sources of manufacturing waste by getting right quantity of raw materials and producing the right quantity of products in the right place at the right time.
JIT - History and Philosophy
JIT is a Japanese management philosophy which has been applied in practice since the early 1970s in many Japanese manufacturing organizations. It was first developed and ...view middle of the document...
"just-in-time" means that raw materials are received just in time to go into production, manufacturing parts are completed just in time to be assembled into products, and products are completed just in time to be shipped to customers. In Just in time manufacturing, the traditional emphasize of keeping everyone busy is abandoned in favor of producing only what customers actually want.
Benefits of JIT
The main benefit of JIT is that it can improve production efficiency and therefore competitiveness.
* preventing over-production
* minimizing waiting times and transport costs
* saving resources by streamlining production systems
* dispensing with the need for inventory operations
* decreasing product defects
It can also bring many of these advantages to customers, so having a JIT approach it can win a new business.
Problems of JIT
Implementing thorough JIT procedures can involve a major overhaul of business systems. It may be difficult and expensive to introduce.
JIT manufacturing also opens businesses to a number of risks, notably those associated with the supply chain. With no stocks to fall back on, a minor disruption in supplies to the business from just one supplier could force production to cease at very short notice.
Just-in-time manufacturing system is vulnerable to unexpected disruptions in supply chain. A production line can quickly come to a halt if essential parts are unavailable.
JIT can bring high levels of competitiveness to big companies that in general suffer from excessive stocks at different stages of the production chain. By producing only the quantity needed, defects can be detected and corrected quickly before large inventories of bad parts are produced. JIT also provides reduced exposure to scrap and rework costs, as well as accelerating the incorporation of engineering changes – all contributing to increased responsiveness and flexibility.