JIT (Just In Time)

Definitions of JIT

Just-in-time is a philosophy which means producing only what is needed, when it is needed, not early, not late; not less, not more. The key target is achieving high volume production using minimal inventories. It is an integrated but simplified system. The JIT mandate is the elimination of all types of waste in the organization. According to this philosophy, anything which is not generating value is called waste.

Just-in-time (JIT) is a highly coordinated processing system in which goods move through the system, and services are performed, just as they are needed. Supplies and components are ‘pulled’ through the system to arrive where they are needed when they are needed.

Just-in-time is defined as the production of the minimum number of units in the smallest possible quantities at the latest possible time, which eliminates the need for inventory. It does not mean to produce on time but to produce “just in time”. JIT is defined as an approach for providing smoother production flows and making continual improvements in processes and products. (Svensson, 2001)

The fundamental aim of JIT purchasing is to ensure that production is as close as possible to a continuous process from receipt of raw materials/components through to the shipment of finished goods. The success and resulting performance of the purchasing system are based upon cooperation between the purchaser and supplier. Some of the elements of this system are as follows: (i) smoothed flow of materials between suppliers and buyers; (ii) order cost reduction; (iii) stock reduction; (iv) quality; and (v) product simplification (Gunasekaran,
1999).
JIT is more than an inventory system. It is an operational philosophy which includes:
 Short lead time
 A maintenance improvement system.
 A quality improvement system.
 A productivity improvement system.
 Minimum inventory-level
 Closely coupled flow-lines

 Pre-requisites of JIT Implementation

Top management is responsible for the change in the organization. For that sake, it has to create an environment in the organization. The management has to develop a culture in the organization. For JIT implementation to be successful, the organization must frame these policies regarding JIT and must get a commitment from the employees to follow the guidelines lead down in the policies by words and means. The implementation of JIT is not just for the sake of change. Most organizations implement JIT just for the sake to beat the competitors. In this way, they miss the true essence of the philosophy and the results are like half-hearted. The success of JIT philosophy lies in the commitment of the employees.
This philosophy covers the whole organization under one umbrella. All the departments have to work with coordination and follow the guidelines with full spirit. The top executives have to be the leaders involved in JIT and they must be the guiding light for all the employees. So, the success of JIT philosophy depends upon the strategic planning that runs deep in the commitment of all the departments and all the employees. Getting everyone involved and committed is the first step to the successful implementation of JIT and the first step to an increase in continuous improvement.
A properly implemented JIT system must have:
 Visible goals
 Produce products as per the customers’ requirements.
 Continuous improvement of all the processes
 Doing right at first time
 Producing at the rate customers want them.
 Delivering the right quality and quality for the first time.
 Produce instantly with zero unnecessary lead time.
 Advocating zero waste of labor, material or equipment.
 Following zero-defect policy

7 Wastes In JIT

 Just-in-time Uses/Application

JIT has an enormous impact on a company’s profitability, especially in a competitive environment characterized by small profit margins. Furthermore, the application of JIT technologies such as small lot size, lead time reduction, and quality improvement plays a significant role in achieving JIT purchasing. (Yang & Pan, 2007) The benefits are as follows:
 Part Costs – Low scrap costs; low inventory carrying costs
 Quality – fast detection and correction of unsatisfactory quality, and ultimately higher-quality purchased parts
 Capital requirements – reduced rework inventories of purchased parts, raw materials, work-in-progress and finished goods.
 Administrative efficiency – fewer suppliers; minimal expediting and order release work; simplified communications and receiving activities. (Chung & Bakar, 2001) Other financial benefits of JIT include:
 Lower investments in factory space for inventories and production;
 Less obsolescence risk in inventories;
 Reduction in scrap and rework;
 Decline in paperwork;
 Reduction in direct material costs through quantity purchases. (Kootanaee, Babu, Talari, 2013)

Benefits of JIT implementation include:

 Reductions in lead-time ;
 Inventory-levels reduction;
 Consistent quality improvement culture;
 Zero wastage in the organization;
 Involvement of employees;
 Stabilize production schedules;
 Increased equipment utilization; and
 Reduction in customer-related problems

Applications of JIT are as follows:

 Inventory Reduction as a Tool for Improvement – Inventory reduction is directly related to cost. Costs are reduced greatly if inventory is reduced.
 Waste Reduction –  If any activity that increases cost but does not add value to any process in an organization is called waste. Eliminate waste of labor, material or equipment. JIT advocates zero waste in an organization.
 Supplier Relationships- There must be a good relationship with suppliers. It helps in getting raw material supply exactly when required.
 Minimum batch sizes –  The batch sizes must be kept as small as possible. The defects can be observed easily in small batches.
 Minimum Movements – The movements must be kept low in production plants. The computerized equipment are very much helpful in minimizing the movements in the plants.
 Total Quality Assurance –  The production department must control all the processes from time to time to control the variation in the production output in terms of quality. Proper training is very much in the total quality assurance.
 Preventive Maintenance – The inspection after the accident is useless. Preventive maintenance is needed to reduce variation in the process. This requires a regular and complete examination of all the processes regularly.