Just in Time AND Supply Chain Management: Athira P V MBA - C Batch

JUST IN TIME
ANDj
SUPPLY CHAIN MANAGEMENT
Athira P V
MBA – C batch
JUST IN TIME
o JIT is a manufacturing philosophy involving an integrated
set of procedures/activities designed to achieve a volume
of production using minimal inventories.
o A highly coordinated processing system in which goods
move through the system, and services are performed,
just as they need.
HOW IT WORKS?
HISTORY
o Evolved in Japan after World War II, as a result of their
diminishing market share in the auto industry.
o Founded by Taiichi Ohno, a vice president of Toyota.
o Basically implemented in Toyota plant 1950, well
established after 1970
FOLLOWERS
o Adopted by General Electrical in the USA in the 1980.
o Some companies referred JIT with different names:
i.TOYOTA – ‘Toyota System’
ii. IBM – ‘Continuous flow manufacturing’
iii. GE- ‘Management by sight’
iv. HEWLETT- PACKARD- ‘stockless production & repetitive
manufacturing system’
7 WASTES IN A FACTORY
o Waste of over production
o Waste of waiting
o Waste of transportation
o Waste of Underutilization of Employees
o Waste of Inventory
o Waste of motion
o Waste of making defective products
SOURCES OF WASTE
o Overproduction
o Waiting time
o Unnecessary transportation
o Processing waste
o Inefficient work methods
o Product defects
JUST IN TIME FUNCTIONS
• ZERO INVENTORY
JIT • ZERO LEAD TIME

(JUST - IN – TIME)
• ZERO FAILURE
OBJECTIVES OF JIT
o To limit resources used in the manufacturing system to only
those needed
o Optimize each individual step of the manufacturing system
o Make a product with no flaws or defects
o Reduce the manufacturing cost.
o To make a product that is demanded by consumers
o There needs to be flexibility in the system
o There needs to be a strong and reliable relationship between
customers and suppliers
PRINCIPLES OF JIT PRODUCTION
o Total quality management

o Production management
o Supplier management
o Inventory management
o Human resource management
TOTAL QUALITY MANAGEMENT
o Seek long-term commitment

o Quality must be a higher priority than cost
o Minimize Waste
PRODUCTION MANAGEMENT
Pull = Made to order
Push = Made for inventory
SUPPLIER MANAGEMENT
INVENTORY MANAGEMENT
o Eliminate Safety Stock = Zero Inventory
o JIT systems view inventory as waste
o work to lower inventory levels to expose and correct the
problems that cause disruption.
o Lowering the level of inventory is relatively easy to do.
However, the problems that arise must be corrected
quickly … Otherwise, the process will flounder
HUMAN RESOURCE MANAGEMENT
o Company-wide Involvement
– Motivation for continuous improvement
– Problem Solving
o Diversified Employees
o Management Support and Empowerment of workforce
JIT BUILDING BLOCKS
PRODUCT DESIGN
o Standard parts
o Design Simplification
o Highly capable production systems
o Concurrent engineering
PROCESS DESIGN
o Small lot sizes
o Setup time reduction
o Limited work in process
o Quality improvement
o Production flexibility Little inventory storage
PERSONNEL/ORGANIZATIONAL ELEMENTS
o Workers as assets
o Cross-trained workers
o Continuous improvement
o Leadership
MANUFACTURING PLANNING AND CONTROL
o Pull systems
o Visual systems (kanban)
o Close vendor relationships
o Reduced transaction processing (delays in delivery)
o Preventive maintenance
REQUIREMENTS OF JIT
o Respond to Customer Requirements
o Integrate all Processes
o Employee Participation
o Company wide Commitment to education
o Eliminate redundancy
o Reduce all Inventory
o Establish Continuous Improvement Goals
REQUIREMENTS OF JIT
o Use a pull Production System
o Design products for Manufacturing
o Develop Controllable Production Processes
o Have Defect Prevention Program
o Reduce Setup Times
o Build Products to Specification
OBSTACLES IN CONVERSION
o Management not committed
o Workers not cooperative
o Decide which parts need most effort
o Start by trying to reduce setup times
o Gradually convert operations
o Convert suppliers to JIT
o Prepare for obstacles
ADVANTAGES OF JITJIT
o High quality
o Flexibility
o Reduced setup times
o Reduced need for indirect labor
o Less waste
o Low warehouse cost
o Synchronization between production scheduling and work
hour
DISADVANTAGES OF JITJIT
o Time consuming
o No spare product to meet un expected order
o Supply Shock : If products do not reach on time
o High risk factor
JIT IN SERVICES: MAC D
IN MCDONALDS
o High holding costs are the nature of the fast food

industries.
o Wastage.
o Time.
IN MCDONALDS
o JIT system wherein McDonald's doesn't begin to cook its
orders until a customer has placed a specific order.
Implementation of JIT
o Sophisticated burger-making technology (including a
record-breaking bun toaster)
o McDonald's is able to make food fast enough to wait until
it's been ordered.
o Reduction in wastage.
IMPLEMENTING JIT IN PRODUCTION SYSTEMS
o Criteria for success

o Service
o Quality
o People
o Food preparation
o Profitability
BENEFITS
o Improved Quality – The burgers are prepared freshly and
hence the quality has improved.
o Customer service – As the burger is made only after the
order is placed, making special orders is not an issue.
o Cost Reduction – Due to significant reduction in wastage
as uncooked material has a higher shelf life.
o Reduction in waiting – Customer’s waiting time reduce 11
min. to just 1 and half min.
BEST EXAMPLE OF JIT SERVICES
THANK YOU

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JUST IN TIME

JIT • ZERO LEAD TIME

o Total quality management

o Seek long-term commitment

o High holding costs are the nature of the fast food

o Criteria for success

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