Globalization has started a competition among all and thus every organization need to be strategically sound in order to survive. In order for a company to survive, the most important aspect is about how far the company may is willing to improve on its productivity. For this purpose the implementation of JIT may be considered as the most important aspect. Thus the quality may be improved in a minimal time frame without any additional cost of labor and a lesser chances of wastage. The system of JIT became popular since 1980’s due to the Japanese firms continuously implementing for improving productivity.
The process of Just In Time is best for the elimination of excess production, wasted steps and materials. This concept was initially developed in 1950 Japenese Toyota Motor Co. employee, Mr. Taiichi Ohono. On his visit to America, he noticed how Henry Ford works and started to take notes. The strategies related to the supply chain uncertainties, transportation, logistics and warehousing are dealt with ease in just in time approach. JIT is a useful process, since it makes use of unused amount (Black, 2009, 500-501).
For the success of any organization, it is important that the company is willing to implement the strategies that would strengthen the process of accounting and financial aspects. Just in Time is the strategy implemented for the purpose of operating as well as developing manufacturing system. It is a useful process where wastage is eliminated through the proper utilization of resources. The purpose of it is to cut off the waste processes so that the continuous productivity may be observed. The philosophy of JIT is right place at right time and thus it is idealistically named as “Just in Time” (Black, 2009, 500-501)
Unnecessary aspects are eliminated at the earliest and thus eliminates any chances for methods of faulty production, unnecessary moving of materials, or excess inventory accumulation. It is also fruitful for improving productivity in terms of investments and profits and thus the levels of inventory are reduced considerably. For the purpose of return of investment as well as improvement of profits, the level of inventory is therefore reduced. This is for the reason JIT is also referred to as stockless or lean production. Thus by cutting down various other costs with the increasing rate of inventory turnover, improving product quality, reducing production, delivery lead times and reducing variability may ultimately lead to the improvement of the product. The process of Just in Time varies from organization to organization but the guiding principles remain the same (Garoma, 2012, 100-101). JIT is majorly applicable to the process of repetitive manufacturing making use of same components and products time and again.
Similar to an assembly line, the general idea is to have a flow of materials in a balanced manner with the work center linked throughout entire process of production (Hansen & Mowen, 2010, 800-801). The linkage of work centers may help to control balanced flow of material thus improving the profits and cutting down the cost of production. Since the internet is dominating the world, the demand for supply is increasing by all leaps and bounds. This process may be a quite helpful one for the improvement of performance, delivery and quality of the product. The consumption of resources according to the demands of the customer is what prioritizes ‘Just in Time’ (Hirano, 2009, 800-801).
On the other hand, the computer integrated manufacturing (CIM) has been a revolutionary step in the history of manufacturing. It has thus led many unprecedented changes in the recent times. The CIM concept when combined with Just in Time may ultimately lead to the conclusion that flexible use of technology with the contemporary concepts of material production excluding the excess and unnecessary cost of production.
The approach of CIM comprises of flexible system of manufacturing, design engineering, CAD/CAM and robotics. In old days, the product was designed in such a way that it had a lifetime warranty which enabled for the recovery of the costs of development. A number of products, particularly high technology ones, today have a shorter time frame in terms of life cycle. Thus it may result in two implications; firstly it is up to the companies to market their product designs faster.
On the other hand, there is a slightly lesser chance to recover the costs of development due to shorter and unreliable life of the product. Thus the companies must make use of cutting edge technology in order to bring down the costs of product designs as well as the time. For the purpose of improvement of efficiency in product design concurrent engineering may be helpful and thus also vital for the reduction of the costs of production (Kerzner, 2009, 920-921).
The practice of Just in Time supports the strategy for computer integrated systems as both are based upon the principle of cutting down the costs of production and at the same time emphasize on quality without additional production. Thus the waste product is utilized somehow or another and is appropriated in the process of purchasing, manufacturing and distribution. JIT program emphasizes upon how to cut short delivery lead times as well as reduced cost of inventories and frequent shipments.
The method for the control of inventory as adopted by the management features low safety stocks as well as high inventory turns. On the other hand, the conventional method turns out to be just on the contrary stockpiling inventory after inventory. Infact, Just in Time method is proved to be beneficial for the increasing turnover on annual basis. Thus there is a significant saving of labor costs and ultimately there is a significant decrease in the rework or wastage of the products. Thus the skills in the employees increase considerably and thus companies implementing JIT may have good housekeeping, better company’s image as well as improved morale (Monden, 2012, 66-61).
It ultimately reduces the problems in the quality due to considerable saving of the time. Thus for this purpose, it may need someone to implement a quality program with zero defects as well as quality assurance of the supplier. Thus it eliminates all the errors resulting in defective things as there are excess components in the buffers. For assigning the workers the responsibility, a quality control manager may be assigned who may check on the quality of work. When something goes wrong, it is his responsibility to stop production on immediate basis. The quality problems through J-I-T are identified and reduced immediately.
Thus, the reduction of inventory levels lead to the accomplishment of quality which may otherwise pose serious questions within the organizational levels. Thus the problem is resolved at the earliest by cutting down the sizes of production lot as well as reduction in the quantity of purchase orders. A disciplined assembly line process is what is required by the JIT system. Even though this flaw is present in the system, nevertheless the companies still opt for the same because of its cost effective approach. Thus the companies like Dell and Toyota are in favor of JIT because of its efficiency.
This system was implemented in the United States in a span of 10 years. The objective of the system is to make sure that the flow of materials is balanced throughout the process of production. Nevertheless it is not a solution that may be applicable to one and all at the same time. The rate of success may vary according to the type of industry and is more suited for medium to high volume production levels.
It is also important that full commitment is required while one is shifting from some other concept to JIT. This part maybe easier said than done and takes on board the employee as well as management personnel.
Initially this system was designed by Toyota in 1950 and thus it was also known as the Toyota Production System (TPS). In the early 1970’s many well established Japanese factories implemented JIT and in 1980 whole of US started implementing the same. The first adopters in the US were General Electric followed by the JIT/lean concepts are now widely accepted and used.
_INFORMATION SYSTEMS AND JIT_
The inclusion of information systems in manufacturing organization has turned out to be beneficial for the organizations. A number of semiconductor companies have been practicing the approach of JIT. On the other hand there are many similar companies that don’t make use of JIT because of the complexity in the operations. The methods of ordering in just in time have been applicable since centuries. This is a process where all the necessary prospects are viewed and implanted at the right moment. The company may get benefit from the savings of money and no excess material is left. Thus there is a rare sight where there is excess material left in the ware houses of the company. Most important of all the materials are delivered at the right time due to the optimal costs.
The successful implementation of the manufacturing strategies of JIT in Japan was infact a wakeup call for the other countries. It has been a very helpful aspect where the companies came to know how to do business in an effective way. Thus it is important that without the control over labor cost and wastage, it would be much difficult task for the organizations to survive in the era of globalization. Quality may thus improve once the companies are able to take care of the aspects of costs, labor and wastage. Increased quality products by the rest of the world are being marketed throughout the world. In order to be in competition with the rest companies need to identify their goals and set up a proper plan of action. JIT is a paradigm that may be applicable to every organization. Yet at the same time proper implementation of plans may only help them in surviving. Proper coordination within the organization as well as the outside companies is also a vital aspect of JIT.
Black, Ken. (2009). _Business Statistics: Contemporary Decision Making_. John Wiley & Sons. ISBN: 0470409010, 9780470409015. Pp 500-501.
Garoma, Temesgen. (2012). Implimentation of Just-in-Time Production System: Building Blocks and Guiding Principles. Lambert Academic Publishing. ISBN: 3848448793, 9783848448791. Pp 100-101.
Hansen, Don & Mowen Maryanne. (2010). _Cornerstones of Cost Accounting._ Cengage Learning. ISBN: 053873678X, 9780538736787. Pp 800-801.
Hirano, Hiroyuki. (2009). _JIT Implementation Manual: The Complete Guide to Just-in-Time Manufacturing_. C R C Press LLC. ISBN: 1420090135, 9781420090130. Pp 800-801.
Kerzner, Harold. (2009). _Project Management: A Systems Approach to Planning, Scheduling, and Controlling_. John Wiley & Sons. ISBN: 0470503831, 9780470503836. Pp 920-921.
Monden Yasuhiro. (2012). _Toyota Production System: An Integrated Approach to Just-In-Time_. CRC Press. ISBN: 143982097X, 9781439820971. Pp 66-61.