Operations Management - MBA MOM705

Just-In-Time Concepts
Day 3 – Delivered by
Kanishka Weeramunda
BIT, MBA (IS), MSc (HR), MBCS, CITP

Just in Time (JIT) – Concepts and its Benefits in

Manufacturing

What is JIT?

JIT is an opposite form of JIC (just in case). JIT is an example of pull system whereas JIC is an
example of push system.

JIT means producing the right part in right quantity, at the right time, thus reducing manufacturing
waste. The objective is to produce a continuous flow of value so that the customer can pull. JIT
supports quick response to customer, better sense of takt time and abnormality control. The JIT
system comprises kanban and production leveling or heijunka.

JIT is a management idea, a tool that enables the internal process of a company and adapt to sudden
changes in demand pattern.

Different types of JIT:

JIT distribution (JITD) - It is the inclusion of a third party logistics. This allows the companies to
focus on their core competencies and areas of expertise and logistics distribution carried out by a
third party.

JITD requires efficient transportation management system, because inbound and outbound material
can have a great effect on production when there is no buffer inventory.

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 JIT purchasing (JITP) - this is counter to traditional purchasing where materials are bought well in
advance, before their use. Under JITP supplier selection, product development and production lot
sizing are critical.

Benefits of JIT
 No big storage areas or godowns are required, avoiding building costs.
 No additional security personnel to guard these godowns, reducing labor costs.
 No excessive buying leading to less capital investment
 No excessive production leading to time & labor cost saving.
 Reduced overheads & scrap
 Reduced WIP as a result of production against demand
 Storage costs & damages during storage are totally avoided.
 Strong supplier/customer relationships
 Enhanced competitive position in the market
 Improved worker & equipment efficiency
 Increased team work & flexibility
 Reduction in paperwork & follow-ups involved there-in
JIT is a time saver, cost saver, labor saver & subsequently a value enhancer of our product.

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 JIT Strategy

JIT is built on the concept of ‘Sell One- Make One’ (SOMO). It leads towards significant quality and
productivity. It is result oriented such that workers responsibility and commitment are enhanced. It
manages the material flow bringing down the inventory levels.

Sl. Techniques
No. under JIT Objectives possible on application
Batch size Reduced lot size
1 reduction Reduced inventories and costs there-of
Eliminate wastes such as long set up times
Eliminates zig-zag material flow and scrap
Set-up time Reduces rework, inspection and machine
2 reduction breakdown
Scientific
machine
and factory Planned layout with minimum transport between
3 design machines reduces material carrying cost

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 Group
technology Identifying and eliminating non-value adding
4 layout activities and elements systematically
Flexible and
multi-
functional Cross-training workers enabling them to operate
5 workforce various machines
Mixed Enabling workers to retain their freshness and
model of reduce fatigue. (long duration of single job leads
6 production to lack of interest)
Focusing and targeting on continuous
improvement using workers knowledge to the
Balanced maximum achieve 'zero defects' in manufacturing
7 scheduling process
Vendors This is required to make sure that materials are
orientation delivered & received on time.
to JIT Done on the basis of mutual understanding &
8 concept relations with vendors/suppliers

Implementation of JIT: Implementing JIT is possible through organizational changes and physical
plant changes. Organizational changes include performance measures, organization structure and
pay pattern to employees.

Physical plant changes are aspects related to ergonomics. Physical changes also include grouping
machinery and equipment into manufacturing cells. Here U-shaped cells are preferred to increase
workers interaction and reducing material handling.

Implementation takes longer times and is tougher because of the organizational changes.