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Just in Time

Just in Time



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Published by api-3704742

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Published by: api-3704742 on Oct 18, 2008
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Just-in-time (JIT)
Just-in-time (JIT) is easy to grasp conceptually, everything happensjust- in-time. For
example consider my journey to work this morning, I could have left my house,just- in-
time to catch a bus to the train station, just-in-time to catch the train, just-in-time to arrive

at my office,just-in-t ime to pick up my lecture notes,just- in-time to walk into this lecture
theatre to start the lecture. Conceptually there is no problem about this; however
achieving it in practice is likely to be difficult!

So too in a manufacturing operation component parts could conceptually arrivejust-in-
time to be picked up by a worker and used. So we would at a stroke eliminate any

inventory of parts, they would simply arrivejust-in-t ime! Similarly we could produce
finished goodsjust-in-t ime to be handed to a customer who wants them. So, at a
conceptual extreme, JIT has no need for inventory or stock, either of raw materials or
work in progress or finished goods.

Obviously any sensible person will appreciate that achieving the conceptual extreme
outlined above might well be difficult, or impossible, or extremely expensive, in real-life.
However that extreme does illustrate that, perhaps, we could move an existing system
towards a system with more of a JIT element than it currently contains. For example,
consider a manufacturing process - whilst we might not be able to have a JIT process in
terms of handing finished goods to customers, so we would still need some inventory of
finished goods, perhaps it might be possible to arrange raw material deliveries so that, for
example, materials needed for one day's production arrive at the start of the day and are
consumed during the day - effectively reducing/eliminating raw material inventory.

Adopting a JIT system is also sometimes referred to as adopting a lean production
system. More about JIT can be foundhere,here,here andhere.
JIT originated in Japan. Its introduction as a recognized technique/philosophy/way of
working is generally associated with the Toyota motor company, JIT being initially

known as the "Toyota Production System". Note the emphasis here - JIT is very much a
mindset/way of looking at a production system that is distinctly different from what
(traditionally) had been done previous to its conception.

Within Toyota Taiichi Ohno is most commonly credited as the father/originator of this
way of working. The beginnings of this production system are rooted in the historical
situation that Toyota faced. After the Second World War the president of Toyota said
"Catch up with America in three years, otherwise the automobile industry of Japan will
not survive". At that time one American worker produced approximately nine times as
much as a Japanese worker. Taiichi Ohno examined the American industry and found that

American manufacturers made great use of economic order quantities - the traditional
idea that it is best to make a "lot" or "batch" of an item (such as a particular model of car
or a particular component) before switching to a new item. They also made use of
economic order quantities in terms of ordering and stocking the many parts needed to
assemble a car.

Ohno felt that such methods would not work in Japan - total domestic demand was low
and the domestic marketplace demanded production of small quantities of many different
models. Accordingly Ohno devised a new system of production based on theel im ination

of waste. In his system waste was eliminated by:
just-in-time - items only move through the production system as and when they
are needed
autonomation - (spelt correctly in case you have never met the word before) -

automating the production system so as to include inspection - human attention
only being needed when a defect is automatically detected whereupon the system
will stop and not proceed until the problem has been solved

In this system inventory (stock) is regarded as an unnecessary waste as too has to deal
with defects.
Ohno regarded waste as a general term including time and resources as well as materials.
He identified a number of sources of waste that he felt should be eliminated:
overproduction - waste from producing more than is needed

time spent waiting - waste such as that associated with a worker being idle whilst waiting for another worker to pass him an item he needs (e.g. such as may occur in a sequential line production process)

transportation/movement - waste such as that associated with transporting/moving
items around a factory
processing time - waste such as that associated with spending more time than is
necessary processing an item on a machine
inventory - waste associated with keeping stocks
defects - waste associated with defective items

At the time car prices in the USA where typically set using selling price = cost plus profit
mark-up. However in Japan low demand meant that manufacturers faced price resistance,
so if the selling price is fixed how one can increase the profit mark-up? Obviously by
reducing costs and hence a large focus of the system that Toyota implemented was to do
with cost reduction.

To aid in cost reduction Toyota instituted production leveling - eliminating unevenness in
the flow of items. So if a component which required assembly had an associated
requirement of 100 during a 25 day working month then 4 were assembled per day, one
every two hours in an eight hour working day. Leveling was also applied to the flow of
finished goods out of the factory and to the flow of raw materials into the factory.

Toyota changed their factory layout. Previously all machines of the same type, e.g.
presses, were together in the same area of the factory. This meant that items had to be
transported back and forth as they needed processing on different machines. To eliminate
these transportation different machines were clustered together so items could move
smoothly from one machine to another as they were processed. This meant that workers
had to become skilled on more than one machine - previously workers were skilled at
operating just one type of machine. Although this initially met resistance from the
workforce it was eventually overcome.

Whilst we may think today that Japan has harmonious industrial relations with
management and workers working together for the common good the fact is that, in the
past, this has not been true. In the immediate post Second World War period, for example,
Japan had one of the worse strike records in the world. Toyota had a strike in 1950 for
example. In 1953 the car maker Nissan suffered a four month strike - involving a lockout
and barbed wire barricades to prevent workers returning to work. That dispute ended with
the formation of a company backed union, formed initially by members of the Nissan
accounting department. Striking workers who joined this new union received payment for
the time spent on strike, a powerful financial inventive to leave their old union during
such a long dispute. The slogan of this new union was "Those who truly love their

union love their company".

In order to help the workforce to adapt to what was a very different production
environment Ohno introduced the analogy of teamwork in a baton relay race. As you are
probably aware typically in such races four runners pass a baton between themselves and
the winning team is the one that crosses the finishing line first carrying the baton and
having made valid baton exchanges between runners. Within the newly rearranged
factory floor workers were encouraged to think of themselves as members of a team -
passing the baton (processed items) between themselves with the goal of reaching the
finishing line appropriately. If one worker flagged (e.g. had an off day) then the other
workers could help him, perhaps setting a machine up for him so that the team output was

In order to have a method of controlling production (the flow of items) in this new
environment Toyota introduced theKanban. The Kanban is essentially information as to
what has to be done. Within Toyota the most common form of Kanban was a rectangular
piece of paper within a transparent vinyl envelope. The information listed on the paper
basically tells a worker what to do - which items to collect or which items to produce. In
Toyota two types of Kanban are distinguished for controlling the flow of items:

a withdrawal Kanban - which details the items which should be withdrawn from
the preceding step in the process
a production ordering Kanban - which details the items to be produced

All movement throughout the factory is controlled by these kanbans - in addition since
the kanbans specify item quantities precisely no defects can be tolerated - e.g. if a
defective component is found when processing a production ordering Kanban then

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