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12. JUST IN TIME

MEANING:

1)-Producing the right quantity of units that is needed, no more, no less

-producing them on the date and at the time required, not after

-that a supplier delivers the exact quantity demanded, at the scheduled time and date.

2) Just-in-time manufacturing is a strategy used in the business manufacturing process to reduce costs

by reducing the in-process inventory level.

Definition:

The American Production and Inventory Control Society (APICS) dictionary defines JIT as

A philosophy of manufacturing based on planned elimination of waste and continuous

Improvement of productivity. It encompasses the successful execution of all manufacturing

Activities required to produce a final product, from design engineering to delivery and including all

states of conversion from raw material onwards.

The primary elements of Just-in-Time are:

To have only the required inventory when needed;

To improve quality to zero defects;

to reduce lead times by reducing setup times, queue lengths, and lot sizes;

to incrementally revise the operations themselves;

And to accomplish these things at minimum cost.

Not all companies use the term JIT. IBM uses the term Continuous Flow Manufacturing,

Hewlett-Packard calls it both Stockless Production and Repetitive Manufacturing System,

GE calls it Management by Sight, Motorola calls it Short Cycle Manufacturing,

And several Japanese firms simply use the term The Toyota System, some companies

Are using the term time-based competition (TBC).

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LEAN MANUFACTURING:

A philosophy of production that emphasizes the minimization of the amount of all the resources

(including time) used in the various activities of the enterprise. It involves:

Identifying and eliminating non-value-adding activities in design, production, supply chain

management, and dealing with the customers.

employing teams of multi-skilled workers at all levels of the customers.

using highly flexible, increasingly automated machines to produce volumes of products in potentially

enormous variety.

JIT MANUFACTURING PHILOSOPHY:

In the traditional view of manufacturing, a key objective was to fully utilize production capacity so that

more products were produced with fewer workers and machines. This kind of thinking led to large

queues meant that machines and workers never had to wait on partially

Finished products to come to them; therefore, capacity utilization was very high and production cost

very low. Unfortunately, large queues of in process inventory also meant that products spent most of

their time in manufacturing just waiting. With this arrangement, companies would be ill equipped to

compete in todays time-based competition.

U.S. manufacturers are geographically located in the middle of the worlds most lucrative market. This

advantage should allow them to beat the competition in responding quickly to customer needs. Quick

response to market demands provides a powerful, sustainable competitive advantage. It is no longer

good enough for firms to be high-quality and low-cost producers. To succeed today, they must also be

first in getting products and services to the customer fast. Firms like Northern Telecom. Xerox, Hewlett-

Packard, Motorola, general electric, Honda, Toyota, Sony, and Boeing are using JIT as a weapon in

speeding market responsiveness. To compete in this new environment, the order -to-delivery cycle

must be drastically reduced. Order-to-delivery cycle means the elapsed time between the moment that

a customer places an order until the customer receives the order. JIT is the weapon of choice today in

reducing the elapsed time of this cycle.

(Figure)

The figure shows that traditional thinking can be deadly to companies that want to use speed as aweapon. In this figure, let us say that a firm is operating at point A, with 96% capacity utilization and a

50-day manufacturing lead time. One way to reduce manufacturing lead time is to find way to increase

production capacity. By studying the companys operations and increasing capacity, the company was

able to move to point B, with a manufacturing lead time of only 10 days and 60% capacity utilization. To

shorten production lead times, 100% of capacity utilization must not be the predominant objective.

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It also shows that by increasing production capacities, manufacturing lead times are reduced.

Production capacities are usually increased in 2 ways, increasing production rates and reducing setup

times at work centers. Increasing production capacities results in a faster and more continuous flow of

products through manufacturing.

There are many opportunities to every step in the order-to-delivery cycle. An important way to reducemanufacturing lead time is to reduce queue lengths and waiting times of partially completed products at

work centers in manufacturing.

PREREQUISITES FOR JIT MANUFACTURING:

The basic idea of JIT is rather simple-drastically reduce WIP inventories throughout the production

system. The main objective of JIT manufacturing is to reduce manufacturing lead time, and this is

primarily achieved by drastic reduction in WIP. The result is a smooth, uninterrupted flow of small lots of

products throughout production.

JIT requires certain changes to the factory and the way it is managed:

1) Stabilize production schedules

2) Make the factories more focused

3) Increase work center capacities

4) Improve product quality

5) Cross-train workers

6) Reduce equipment breakdowns

7) Develop long-term supplier relations.

Reducing inventories through set up reduction:

JIT is an ongoing program aimed at the reduction of production lot size so that inventory level

are reduced. It seems that very small production lot sizes would result in too many machines setups,

JIT system spends large sums of money to reduce setup times to avoid these negative consequences

of small lot sizes. Engineers study the setups, automatic devices are attached to the machines,

workers are trained in more efficient work methods, and the result is very short setup times.

Working toward Repetitive Manufacturing:

The repeated production of the same discrete products or families of products. Repetitive

methodology minimizes setup, inventory, and manufacturing lead times by using production lines,

assembly lines, or cell. Work orders are no longer necessary, production scheduling and control is

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based on production rates. Products may be standard or assembled from modules. Repetitive is not a

function of speed or value.

1. Reduce setup times and production lot sizes.

2. Change the layout of the factory to allow streamlined product flows through the plant.

3. Install flexible manufacturing system. These groups of machines can accommodate product variety

without the necessary of worker performed machine changeover.

4. Train workers for several jobs. These flexible workers can move from work center to work center

as necessary to balance the workload in the factory.

5. Install effective preventive maintenance programs so that machine breakdowns do not interrupt

product flows.

6. Install effective quality control programs so that defective products do not interrupt product flows.

7. Develop an effective subcontractor network so that materials flow into the factory smoothly to

support the in house production schedules, thereby allowing uninterrupted production.

Benefits of JIT Manufacturing:

1. Inventory levels are drastically reduced.

2. The time it take for products to get through the factory is greatly reduced, thus enabling factories

to engage in time based competition, using speed as a weapon to capture market share.

3. Product quality is improved, and the cost of scrap is reduced. Product quality improves because of

worker involvement in solving the causes of production problems, and with smaller lots, defective

parts are discovered earlier.

4. workers are closer together so that they can see each other, communicate more easily, work out

problems more efficiently, learn each others jobs, and switch jobs as needed. This promotes

teamwork among workers and flexibility in work assignment.

5. Because the focus in manufacturing is on finding and correcting the causes of production

problems, manufacturing operations are streamlined and problems free.

Success and JIT Manufacturing:

1. Business strategies based on producing standardized products that can be mass produced both

cost and with outstanding product quality.

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2. The latest production technology, including robotics, flexible manufacturing system (FMS), group

technology (GT), automatic storage and retrieval systems (ASRS), bar coding, computer aided

design (CAD), computer aided manufacturing (CAM), and computer integrated manufacturing

(CIM).

3. The economies of reduced setup times. Less labor is used to make the setups, and machines are

not idle as long during the setups. This can contribute to lower labor cost and under certain

conditions, higher machine capacity utilization.

5.Worker trained on many jobs. They can move from one job to another as needed to balance the

workload, which contributes to high worker utilization and lower labor cost.

6. Job security programs for worker. Less employee turnover results in a better trained work force

and reduced hiring and training costs.

7. Total quality management (TQM) programs. Every worker is involved and motivated to make thecompany a success through perfect product quality.

8. Participative management style. The attitude of mangers toward worker, and benevolent company

personnel policies, have tended to develop cooperation between workers and management.

JIT in Service Companies:

The JIT goals of reduced waste, improved quality, and shorter lead times are attractive to all

industries. In recent years, many service organizations have adopted some of the approaches and

techniques of the JIT philosophy, in order to achieve some of these benefits. One such techniques isPOKA-YOKE, or mistake proofing. Mistake-proofing refers to redesigning a process so that it is more

difficult to make a mistake in the process.

Another technique often used in JIT manufacturing is good HOUSEKEEPING. The APICS dictionary

defines housekeeping as the manufacturing activity of identifying and maintaining an orderly

environment for preventing errors and contamination in the manufacturing process.

These housekeeping rules are often referred to as 5S process. Which are as follows:

Sort: Simplify what is kept or stored at each workstation.

Straighten: Keep every item in a designated place at each workstation.

Sweep: Keep each workstation clean.

Standardize: Set standards and require all employees to follow these rules as a habit.

Self discipline: instill the discipline in employees to keep their workstations organized.

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These JIT approaches and many others are useful in service organizations as well as in manufacturing.

And service operations managers can help to make their organization more competitive by studying

how manufacturing companies have implemented these JIT approaches.

ELEMENTS OF JIT MANUFACTURING

We will discuss JIT by examining its important components as under:

1. Eliminating Waste:

Overproduction : Make only what is needed now.

Waiting: Coordinate flows between operations, and balance load imbalances by flexible workers and

equipment.

Transportation: Design facility layouts that reduce or eliminate material handling and shipping.

Unneeded production: Eliminate all unneeded production steps.

Work-in-progress inventories: Eliminate by reducing setup times, increasing production rates, and

better coordination of production rates between work centers.

Defective Products: Eliminate defects and inspection. Make perfect products.

2. Enforced Problem Solving and Continuous Improvement:

In traditional manufacturing, in-process inventories allows production to continue even if

production problems occur. Thus, high machine and worker utilization is achieved. If defective

products are discovered, machine malfunction, or material stockouts occur, in-process inventory

can be used to feed what would otherwise be idle workers and machines.

JIT is the continuous drive to improve production processes and methods. JIT is really a system

of enforced problem solving. And hence there are few safety factors in JIT. Every material is

expected to meet quality standards, every part is expected to arrive at the time promised and

precisely at the place it is supposed to be, every worker is expected to work productively, and

every machine is expected to function as intended without breakdowns.

Implementing a JIT program is to reduce in-process inventories incrementally in small steps

because high inventory level are thought to cover up production problems. By drastically

reducing in process inventories, production problems are uncovered and production stops until

the cause of production problems are solved. At each step, different production problems are

uncovered, and the workers and their managers work to eliminate the problems.

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3. People Make JIT Work:

Business ultimately succeed or fail because of their people. JIT manufacturing, has a strong

element of training and involvement of workers in all phase of manufacturing.

A culture of mutual trust and teamwork must be developed in an organization. Managers andworkers must see each other as coworkers committed to the companys success. Workers are

also encouraged to suggest better ways of doing things from small suggestion to strategic issues.

Since workers are committed to the success of the company, the work team rather than the

individual worker becomes the focus. Worker are not free to go off on their own and try any

method of doing their work according to any standard that they choose.

Another important factor that is crucial to the success of JIT is the empowerment of workers.

This means that workers are given the authority to take the initiative in solving production

problems. Rather than waiting for guidance from above, workers have the authority to stop

production at any time for such things as quality problems, machine malfunctions, or safety

concern. Having workers actively involved in problem solving is the objective of worker

empowerment.

4. Total Quality Management:

JIT manufacturing depends on a system of total quality management (TQM). Total commitment

to produce products of perfect quality every time and total commitment to produce products for

fast delivery to customers. This is one of the main thing behind JIT because time required to

reach the finish product to customer get reduced.

5. Parallel Processing:

An important part of JIT manufacturing is to exploit parallel processing wherever possible. Any

operation being performed in series that can be performed in parallel can take huge chunks out

of manufacturing lead time. By doing product design and process design simultaneously, the time

to bring new products to market is reduced.

6. Kanban Production Control:

The core of JIT manufacturing at Toyota is Kanban, an amazingly simple system of planning andcontrolling production. Kanban cards are used to plan and control the movement of orders

among work centers. No parts can be produced or moved without a Kanban cards. Kanban is

based on the simple idea of replacement of container of parts, one at time. There are two types

of Kanban cards a conveyance card (C- Kanban) and production card (P- Kanban).

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When a workers at the downstream work center #2 needs a container of parts for his operation

does following:

a. He finds C-Kanban in the pocket on the side of container that he has just emptied at his work

center, this card is his authorization to replace the empty container with a full one from storage.

b. Next he takes C-Kanban and find full container of the needed part s in storage.

c. Then, he place C-Kanban in the full container.

d. Next, he removes the P-Kanban from the full container and places it on a post at the upstream

Work center #1, this P-Kanban is the authorization for Work center #1 to produce another

container of the parts.

e. Finally he takes the full container of parts with its C-Kanban to his downstream Work Center #

2.

7. JIT Purchasing:

In JIT purchasing, supplier used the replacement principle of Kanban by using small, standard size

container and make several shipments daily to each customer. The essential elements of JIT

purchasing are as follows:

a. Purchasing department develop long term relationship with supplier. The result is long term

supply contracts with a few supplier rather than short term supply contracts with many suppliers.

b. Although price is important, delivery schedules, product quality, and mutual trust andcooperation become the primary basis for supplier selection.

c. Supplier are ordinarily located near the buying firms factory.

d. Shipment are delivered directly to the customers production line.

e. Parts are delivered in small, standard size container with a minimum of paper work and in

exact quantities.

f. Delivered material is of near perfect quality. Suppliers have a long term relationship with the

buying firms.

8. E-Commerce and JIT Purchasing:

E-commerce is having a beneficial effect on JIT purchasing. Internet based information system

allows companies to quickly place orders for materials with their suppliers. This eliminates

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wasted time dealing with paperwork and reduces the procurement lead time. Also data entry

errors created through paperwork process are eliminated . Labor costs are reduced as well.