JUST IN TIME

APICS DEFINITION OF JIT

MANUFACTURING SYSTEMS

A philosophy of manufacturing based

on planned elimination of waste and
continuous improvement of
productivity

APICS UNDERSTANDING OF JIT IMPLICATIONS OF JIT

The primary elements of Just-in-Time systems are: Customer responsiveness

to have only the required inventory when needed; Lead time reduction
to improve quality to zero defects;
Quality in all
to reduce lead times by reducing setup times,
queue lengths, and lot sizes; Reduction of the negative impacts of inventory
to incrementally revise the operations themselves; Flexibility
and to accomplish these things at minimum cost. Cost effectiveness
What is the motivation ?

JIT 1
 INCREASING THE PROFITABILITY
IS THE MOTIVE
Profit is Revenue minus cost
Revenue depends on Volume and Price
Volume and price are influenced by response
time, quality and flexibility
Cost types: necessary and unnecessary
Unnecessary cost is waste
The strategy is to
a) Reduce response time
b) Increase flexibility and quality
c) Eliminate waste and improve productivity
WHAT ARE THE BENEFITS ?
WHAT ELSE IS VIEWED AS JIT ?
JIT
LONG TERM BENEFITS ARE
Loyal customer base
Higher return on capital assets (ROCE)
Higher return on the current assets
Stable and reliable cash- in-flow
Regulated and justifiable cash-out-flow
JIT SYNONYMS
IBM - Continuous Flow Manufacturing
HP - Stockless Production
- Repetitive Manufacturing System
GE - Management by Sight
Motorola - Short Cycle Manufacturing
Japanese - The Toyota System
Boeing - Lean Manufacturing
Some places: Single Piece Flow
Ref: Operations management by N Gaither
and G Frazier, Thomson Learning, 2002
2
 TRADITIONAL VIEW OF
MANUFACTURING
Key objective was to fully utilize capacity so
JIT MEANS MANY THINGS TO MANY that more products were produced by fewer
workers and machines
How? With large queues of in-process inventory
BUT WHAT ARE THE IMPLICATIONS ? waiting at work centers
Workers and machines never had to wait for
product to work on, so capacity utilization was
high and production costs were low
Result: Products spent most of their time in
manufacturing just waiting, an arrangement that
is unacceptable in todays time-based
competition

ORDER-TO-DELIVERY CYCLE
TIME-BASED COMPETITION
Manufacturing
Cumulative Lead Time It is not enough for firms to be high-quality
and low-cost producers
Manufacturing Distribution
Customer
Lead Times and Today, they must also be first in getting
Places Order Engineering
Entry Design
Scheduling
Customer products and services to the customer fast
Order Purchasing
Lead Times Service To compete in this new environment, the
order-to-delivery cycle must be drastically
reduced
Order-to-Delivery Cycle JIT is the weapon of choice today to reduce
the elapsed time of this cycle

JIT 3
 THE END RESULT ?
JIT MANUFACTURING PHILOSOPHY SOME TYPICAL ACENARIOS

The main objective of JIT

manufacturing is to reduce
manufacturing lead times
This is primarily achieved by drastic
reductions in work-in-process (WIP)
The result is a smooth, uninterrupted
flow of small lots of products
throughout production

Yakima Lash Company

Uniform Plant Loading
a. Product line I II III IV
A level schedule is developed so that the same mix of
Forecast for year 500 1,500 3,500 4,500 products is made every day in small quantities
Daily batch 2 6 14 18 Leveling the schedule can have big impact along whole supply
Hourly batch .25 .75 1.75 2.25 chain
Mixed model 1 3 7 9 W ee kly P ro d u ctio n R e q u i red
A 10 units
b. Schedule for the day-order of the products' B 20 units
production and number of each produced. C 5 units
D 5 units
8-12: E 10 units
IV,IV,IV,IV,IV,IV,IV,IV,IV,III,III,III,III,III,III,III,II,II, T rad itio n al P ro d u cti o n P lan
M ond ay T ues day W edne sda y T hurs day F rid ay
II,I A AAAA B BBBB BB BBB DD DD D EEE EE

12-4: A AAAA B BBBB

J IT P lan w i th L eve l S ch ed u lin g
BB BBB CC CC C EEE EE

IV,IV,IV,IV,IV,IV,IV,IV,IV,III,III,III,III,III,III,III,II,II, M ond ay T ues day W edne sda y T hurs day F rid ay

II,I A ABBB B
C DEE
A ABBB B
C DEE
AA BBBB
C DEE
AA BBBB
CD EE
AAB BBB
CD EE

15 Wiley 2010 16

JIT 4
STEPS TO ACHIVE JIT BASICS OF JIT MANUFACTURING
CAPABILITIES Challenge status quo
Build a new system
People make JIT work
Total Quality Management (TQM)
Eliminating waste
Enforced problem solving and continuous
improvement
Better capacity management for reducing
Inventories / Lead time
Kanban production control
Changes in manufacturing systems/policies
Wiley 2010 17 JIT purchasing

TEN COMMANDMENTS OF JIT

>Throw out the Traditional concepts of manufacturing
CHALLENGE STATUS-QUO
methods
>Think about how the new method will work; not how it
wont.
>Dont accept excuses. Totally deny the status quo.
>Dont seek perfection at the beginning; A 50%
implementation rate is fine as long as it is implemented
on the spot.
>Correct mistakes the moment they are found.
>Dont spend money on innovations.
>Problems give you a chance to use your brain
>Ask why five times
>Ten persons ideas are better than one persons
knowledge.
>Kaikaku ( innovation)knows no limit.

JIT 5
 IMPORTANT ELEMENTS IN JIT
HOW TO BUILD A JIT MANUFACTURING SYSTEMS
1)Lot size reduction
SYSTEM? production/purchase
2) Set up time reduction (SMED)
3) Buffer stock removal
4) Floor space reduction
5) Discipline in material handling
6) Group technology
7) Dedicated production line
8) Overlapped production
9) Mixed model scheduling
10) Synchronised scheduling
11)Regularity in end
scheduling
12) Under capacity scheduling
13)Small machines and multiple copies
14)Multi slot Tool magazines
TOTAL QUALITY
PEOPLE MAKE JIT WORK
MANAGEMENT
TQM COMPANY WIDE QUALITY CONTROL
Empowerment ( CWQC)
Waste Elimination
Small Group Activities and Problem TQM
Solving
JIT
in 15) Process data collection
16) Zero deviation from scheduling
17) Component item standardisation
18) Component routing standardisation
19)Cross trained shop floor/office
workers
20) Worker oriented quality control
21) Poka-yoke
22)Autonomous inspection-quality
/quantity
23) TPM
product 24) Kanban system
25) Just in time purchasing
26) Plant wide Kaizen
27) Quality circles
28) Computers in design and
manufacturing
6
 TQM TQM
Enterprise level quality product,
Customer Focus
processes, systems, people, partners etc
Quality in all (do it right the first time)
Quality in all levels individual, group,
Continuous improvement shop floor, factory, enterprise, industry,
Quality is every ones responsibility involve national
all ( participation and empowerment) Customer(internal and external) focus,
Societal focus continuous improvement, involve all ,
societal network

STEPS TO BECOME A TQM

ORGANISATION WASTE ELIMINATION
Individuals- commitment and training
Small Groups commitment and problem OHNOS 7 WASTE
solving
Departments commitment and policies NEW 8 WASTE
and initiatives, celebrating success
Organisation commitment, support and
directions, recognition
Society focus, sharing experience,
knowledge sharing, multi directional growth

JIT 7
 WASTE--OPERATIONS ADD THE EIGHTH WASTE
(1) Waste from overproduction
WASTE OF HUMAN RESOURCES ??
(2) Waste of waiting time
(3) Transportation waste
(4) Inventory waste
(5) Processing waste
(6) Waste of motion
(7) Waste from product defects

PROBLEM SOLVING AND CONTINUOUS IMPROVEMENT

JIT is a system of enforced problem solving-
One approach is to lower inventory gradually
to expose problems and force their solution.
With no buffer inventories to rely on, in times of
production interruptions, problems are highly visible
and cannot be ignored.
The job of eliminating production problems is
never finished.
Continuous improvement - practices of Quality
circles, SGA, SMED, POKA YOKE, kAIZEN etc-
central to the philosophy of JIT.
Small Lot Sizes & Quick Setups
Small lots mean less average inventory and shorten
manufacturing lead time
Small lots with shorter setup times increase flexibility to
respond to demand changes
Strive for single digit setups- < 10 minutes
Setup reduction process is well-documented
External tasks- do as much preparation while present job is still
running
Internal tasks- simplify, eliminate, shorten steps involved with
location, clamping, & adjustments
Ultimate goal is single unit lot sizes

Wiley 2010 32

JIT 8
 CAPACITY UTILIZATION
CAPACITY MANAGEMENT Production Lead Times (days)
60

50
Traditional
Manufacturing
40

30

20 JIT
Manufacturing
10
% Capacity
Utilization
10 20 30 40 50 60 70 80 90 100

INCREASING PRODUCTION
CAPACITY REDUCES
MANUFACTURING LEAD TIMES
Only slight increases in production
capacities can lead to:
Significant reduction of
manufacturing lead times
Significant reduction of work-in-
process inventory
Queuing theory ?
EXAMPLE: NECESSARY
PRODUCTION CAPACITY
A production manager believes reducing
the firms manufacturing lead time will give
the firm a significant competitive advantage.
Two days is the lead time goal.
Currently, jobs are arriving at the rate of
6 per day and the operation can process an
average of 6.125 jobs per day.

JIT 9
 Single-Server Model 1

What is the current average lead time for a

job?
How much of a reduction in WIP will result
if production rate is increased by 6 %
What is the necessary production rate to
achieve the two-day lead time goal?

UNCOVERING PRODUCTION
EXAMPLE: REDUCTION IN WIP PROBLEMS
Visible Production
We must lower the water level!
In the preceding example, the production rate was Problems are Only
5% of the Total!
increased from 6.125 jobs per day to 6.5.
Machine
Breakdowns
This 6% increase in the production rate yielded a Out-of-Spec
In-Process Workload
75% reduction in manufacturing lead time! Materials
Inventory Imbalances
Worker Material Quality
Absenteeism Shortages Problems

JIT 10

Role of Inventory Reduction
Inventory = Lead Time (less is better)
Inventory hides problems
Wiley 2010
SETUP TIME REQUIRED FOR AN
EOQ
The economic production lot size (EOQ) model is:
2DS p
EOQ =
C p-d
where:
D = annual demand rate
d = daily demand rate
p = daily production rate
C = carrying cost per unit per year
S = cost per setup
JIT
REDUCING INVENTORIES
THROUGH SETUP TIME REDUCTION
Central to JIT is the reduction of production
lot sizes so that inventory levels are reduced.
Smaller lot sizes result in more machine
setups
More machine setups, if they are lengthy,
result in:
Increased production costs
Lost capacity (idle machines during setup)
The answer is: REDUCE MACHINE SETUP
TIMES
41
EXAMPLE: SETUP TIME REQUIRED
A firm wants to determine what the length of
the setup time of an operation should be in
order to make a production lot size (EOQ) of
50 economical. An analyst has made the
following estimates:
D = 16,800 units (annual demand)
d = 84 units (daily demand rate @ 200
days/yr)
p = 140 units (daily production rate)
C = Rs.20 (carrying cost per unit per year)
Labor rate = Rs 25.00/hour
11
 JIT: A PULL SYSTEM JIT LOGIC
Fab Vendor
In a push system, such as an MRP
system, we look at the schedule to Sub
Fab Vendor
determine what to produce next
Customers Final Assy
In a pull system, such as JIT, we look
only at the next stage of production and Sub Fab Vendor
determine what is needed there, and
then we produce only that
Fab Vendor

Here the customer starts

the process, pulling an JIT Demand-Pull Logic KANBAN PRODUCTION CONTROL
inventory item from
At the core of JIT manufacturing at Toyota is
Final Assembly
Kanban, an amazingly simple system of
Then sub- planning and controlling production
assembly work is Fab Vendor
pulled forward by
Kanban, in Japanese, means card or marquee
that demand Sub Kanban is the means of signaling to the
Fab Vendor upstream workstation that the downstream
Final
Customers workstation is ready for the upstream
Assembly
workstation to produce another batch of parts
The process continues Sub Fab Vendor
throughout the entire
production process and
supply chain Fab Vendor

JIT 12
 KANBANS AND OTHER SIGNALS

There are two popular types of Kanban Production Instruction

cards: Instructs what to produce and in what quantity
a conveyance card (C-Kanban) Removed when parts are transferred to the next
process
a production card (P-Kanban) Instructs to produce another lot when removed
Signals come in many forms other than Parts Retrieval
cards,
Communicates what parts have been used
Removed when parts are produced
What is possible ? Taken to preceeding process to retrieve parts

KANBAN CARDS KANBAN CARDS

Production Kanban Card

Conveyance Kanban Card
Part number to produce: M471-36
Lot size needed: 40
Card number: 2 of 5
From work center: 22
Part number to produce: M471-36 Part description: Valve Housing
Part description: Valve Housing
Lot size needed: 40 Container type: RED crate
Container type: RED Crate
Card number: 4 of 5 Completed storage location: NW53D
Retrieval storage location: NW53D
From work center: 22 To work center: 35
To work center: 35
Materials required:
Material no. 744B Storage location: NW48C
Part no. B238-5 Storage location: NW47B

JIT 13
 FLOW OF KANBAN CARDS AND
CONTAINERS HOW KANBAN SYSTEM OPERATES
P-Kanban and C-Kanban and When a worker at downstream Work Center #2
empty container empty container
needs a container of parts, she does the
Full container Full container
and P-Kanban and C-Kanban
following:
She takes the C-Kanban from the container she
just emptied
>She goes to Work centre 1 (upstream)
She finds a full container of the needed part in
In-process storage
Upstream Downstream
storage
Work Center #1 Work Center #2 She places the C-Kanban in the full container and
removes the P-Kanban from the full container and
Parts Flow places it on a post at Work Center #1
>She takes the full container of parts with its
C-Kanban back to Work Center #2

Variations on Kanban
Production
Kanban boxes space on factory floor for
storing supplies
Flags used to indicate when supplies
need to be ordered
Supplier kanbans brings filled containers
to point of usage in factory/picks up empty
containers

Wiley 2010 56

JIT 14
 MAY ALSO BE CONTAINERS IN A KANBAN SYSTEM

An empty crate Kanban is based on the simple idea of replacement of

containers of parts, one at a time.
An empty designated location on the Containers are reserved for specific parts, are
floor purposely kept small, and always contain the same
A signal light standard number of parts for each part number.
At Toyota the containers must not hold more than
about 10% of a days requirements.
There is a minimum of two containers for each part
number, one at the upstream producing work
center and one at the downstream using work
center.

Computing the Number of Kanbans: an aspirin manufacturer has

converted to JIT manufacturing using kanban containers. They must
determine the number of containers at the bottle filling operation which

Number of Kanbans Required fills at a rate of 200 per hour. Each container holds 25 bottles, it takes 30
minutes to receive more bottles, safety stock is 10% of demand during LT.

Solution :
DT S D 200 bottles per hour
N
C T 30 minutes .5 hour
C 25 bottles per container
N = number of containers
S 0.10(deman d)(T) 0.10(200)( .5) 10 bottles
D = demand rate at the withdrawal station
T = lead time from supply station DT S (200)(.5) 10
N 4.4 kanban containers
C 25
C = container size
Question : round up or down?
S = safety stock

Wiley 2010 59 Wiley 2010 60

JIT 15
 CHANGES IN MANUFACTURING SYSTEMS AND
POLICIES Manufacturing Planning and Control
Layout- Cells and U shaped System and JIT
Use of MRP for generating MPS
Repetitive production
Single Machine Exchange of Dies ( SMED)
JIDOKA
ANDON BOARDS

62

A Closer Look at Jidoka -- Concept

What is Jidoka?

Automation with a human touch

Practice of stopping a manual line or process

when something goes amiss

Also known as Autonomation

JIT 16
 How It Works
Sakichi Toyoda
Adds human judgment to automated equipment Automatic loom, 1896
Designed to stop automatically, 1924
Broken vertical thread
Minimizes poor quality
Horizontal thread did not appear
Transferred quality responsibility to machines
Makes the process more dependable Elimination of defective products
Waste reduction
Gives the employee responsibility and authority Poka Yokes
to stop production

Visual Control

Lanterns in Japanese
Display current state of work
Alert operators to stoppages or abnormalities
Displays automatic and manual shutdowns

Advantages
Cost/labor reduction
Multi-skilled workers

JIT 17
 ESSENTIAL ELEMENTS OF JIT
PURCHASING
Cooperative and long-term relationship between
MBWA Management By Wandering Around customer and supplier.
Supplier selection based not only on price, but also
Marketplace
delivery schedules, product quality, and mutual trust.
Production plans
Suppliers are usually located near the buyers factory.
Shipments are delivered directly to the customers
Layers of why production line.
Ask yourself why 5 times Parts are delivered in small, standard-size containers
Often leads to the problems true essence with a minimum of paperwork and in exact
Creativity in insanity? quantities.
Experiences not possible under normal conditions Delivered material is of near-perfect quality.
Potential to rise above normalcy

E-COMMERCE AND JIT PURCHASING Traditional Buffered Supply Chain

Internet-based information systems allow
firms to quickly place orders for materials 2nd Tier

with their suppliers Flow of Production

This is an efficient and effective purchasing
process 1st Tier

Saves the time of paperwork

Avoids errors associated with paperwork
Customer
Reduces procurement lead time Flow of Information Assembler
Demand
Reduces labor costs
and Kanbans can be sent to suppliers

JIT 18
 The Just-in-Time Supply Chain:
Expectations from Suppliers
Impact on Stocks!
2nd Tier Frequent deliveries.
Flow of Production
Hours (not days) lead time.
1st Tier
Rapid response capability (not from stocks).

Toyota
Flow of Information Delivery to assembly line at the right time in the right
sequence without inspection.

Customer Reliability (quality and timing).

Demand

Supplier Relationships Whats in it for a supplier?

Long-term, steady relationships with a few
suppliers. A Stable Manufacturing Environment.
Steady production volume.
Negotiation based on a long term commitment to
productivity and quality improvement.
Leaner Processes.
Interested in supplier capabilities. Cost/Flexibility/Quality
Continuous improvement.
Product/process technology.
Profits.
Design for manufacturability.

JIT 19
 BENEFITS OF JIT

Inventory levels are drastically reduced:

frees up working capital for other projects
less space is needed
customer responsiveness increases
Total product cycle time drops
Product quality is improved
Scrap and rework costs go down
Forces managers to fix problems and
eliminate waste .... or it wont work!

SOME LIMITATIONS - JIT

SOME OF THE MAJOR HURDLES
Difficulty to change old ways
More pressure on workers
Success is varied
Employee commitment
Production levels
Employee skills

Ref: Some Slides are related to Chapter 12

Operations management by N Gaither and G Frazier, Thomson
Learning, 2002

JIT 20
 CHANGES REQUIRED FOR JIT
SUCCESSFUL JIT APPLICATIONS ARE SPECIFIC
JIT requires certain changes to the factory TO SOME COUNTRIES, INDUSTRIES
and the way it is managed: Most successful JIT applications have been in
Stabilize production schedules repetitive manufacturing, where batches of
Make the factories more focused standard products are produced at high
speeds and in high volumes.
Increase work center capacities
Improve product quality
Successful use of JIT is rare, in large highly
complex job shops, where production
Cross-train workers
planning and control is extremely
Reduce equipment breakdowns complicated.
Develop long-term supplier relations
Smaller, less complex job shops have used
JIT, but operations have been changed so
that they behave somewhat like repetitive
manufacturing.

JIT PRODUCTION
WHAT IT IS WHAT IT DOES

Attacks waste
Management philosophy
Exposes problems and bottlenecks
Pull system through the plant
Achieves streamlined production

WHAT IT REQUIRES WHAT IT ASSUMES

Employee participation
Industrial engineering/basics Stable environment
Continuing improvement
Total quality control
Small lot sizes

JIT 21