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Business Research Mythology


FAIZAN KHAN: 2073173


Problem: JIT system, continuous improvement and

production efficiency
Just in Time Manufacturing
Just in Time Manufacturing (JIT) refers to a system of manufacturing in
which products are not built until the product is ordered and paid for. Some
companies that have successfully implemented JIT include Toyota, Dell and
Harley Davidson.

Toyota is considered by many to be the poster child for JIT success. The
Toyota production strategy is highlighted by the fact that raw materials are
not brought to the production floor until an order is received and this product
is ready to be built. No parts are allowed at a node unless they are required
for the next node, or they are part of an assembly for the next node. This
philosophy has allowed Toyota to keep a minimum amount of inventory
which means lower costs. This also means that Toyota can adapt quickly to
changes in demand without having to worry about disposing of expensive
Important factors to Toyota success
Small amounts of raw material inventory must be kept at each node in
production, so that production can take place for any product. These parts
are then replenished when they are used.
Accuracy of forecasting is important so the correct amount of raw
materials can be stocked.
Lean Manufacturing (also known as the Toyota Production System) is,
in its most basic form, the systematic elimination of waste overproduction,
waiting, transportation, inventory, motion, over-processing, defective units
and the implementation of the concepts of continuous flow and customer
Five areas drive lean manufacturing/production:
Cost quality
safety, and

Just as mass production is recognized as the production system of the
20th century, lean production is viewed as the production system of
the 21st century.

Benefits of Lean Production

Establishment and mastering of a lean production system would allow
you to achieve the following benefits:
Waste reduction by 80%
Production cost reduction by 50%
Manufacturing cycle times decreased by 50%
Labor reduction by 50% while maintaining or increasing throughput
Inventory reduction by 80% while increasing customer service levels
Capacity in current facilities increase by 50%
Higher quality
Higher profits
Higher system flexibility in reacting to changes in requirements
More strategic focus
Improved cash flow through increasing shipping and billing

Kaizen and Management

Management has two major components:
Maintenance and Improvement
The objective of the maintenance function is to maintain current
technological, managerial, and operating standards. The improvement
function is aimed at improving current standards.
Under the maintenance function, the management must first establish
policies, rules, directives and standard operating procedures (SOPs) and then
work towards ensuring that everybody follows SOP. The latter is achieved
through a combination of discipline and human resource development

Under the improvement function, management works continuously towards

revising the current standards, once they have been mastered, and
establishing higher ones. Improvement can be broken down between
innovation and Kaizen. Innovation involves a drastic improvement in the
existing process and requires large investments. Kaizen signifies small
improvements as a result of coordinated continuous efforts by all employees.
Implementation of Kaizen Strategy
One of the most difficult aspects of introducing and implementing Kaizen
strategy is assuring its continuity.
When company introduces something new, such as quality circles, or total
quality management (TQM), it experiences some initial success, but soon
such success disappear like fireworks on summer night and after a while
nothing is left, and management keeps looking for a new flavor of the
This if because the company lacks the first three most important
conditions for the successful introduction and implementation of Kaizen