Just In Time :
What is it?
An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs.
About JIT :
JIT is a philosophy of continuous improvement in which non-value-adding activities (or wastes) are identified and removed for the purposes of:
JIT is not about automation. JIT eliminates waste by providing the environment to perfect and simplify the processes. JIT is a collection of techniques used to improve operations It can also be a new production system that is used to produce goods or services.
The American Production and Inventory Control Society (APICS) has the following definition of JIT:
When the JIT principles are implemented successfully, significant competitive advantages are realized. JIT principles can be applied to all parts of an organization: order taking, purchasing, operations, distribution, sales, accounting, design, etc.
A good example would be a car manufacturer that operates with very low inventory levels, relying on their supply chain to deliver the parts they need to build cars. The parts needed to manufacture the cars do not arrive before nor after they are needed, rather they arrive just as they are needed.
This inventory supply system represents a shift away from the older "just in case" strategy where producers carried large inventories in case higher demand had to be met.
Elimination of Waste:
JIT usually indentifies seven prominent types of waste to be eliminated:
What is it?
An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs.
About JIT :
JIT is a philosophy of continuous improvement in which non-value-adding activities (or wastes) are identified and removed for the purposes of:
- Reducing Cost
- Improving quality
- Improving performance
- Improving Delivery
- Adding Flexibility
- Increase innovativeness
The American Production and Inventory Control Society (APICS) has the following definition of JIT:
"a philosophy of manufacturing based on planned elimination of all 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 stages of conversion from raw material onward. The primary elements include having only the required inventory when needed; to improve quality to zero defects; to reduce lead time by reducing setup times, queue lengths and lot sizes; to incrementally revise the operations themselves; and to accomplish these things at minimum cost."
When the JIT principles are implemented successfully, significant competitive advantages are realized. JIT principles can be applied to all parts of an organization: order taking, purchasing, operations, distribution, sales, accounting, design, etc.
A good example would be a car manufacturer that operates with very low inventory levels, relying on their supply chain to deliver the parts they need to build cars. The parts needed to manufacture the cars do not arrive before nor after they are needed, rather they arrive just as they are needed.
This inventory supply system represents a shift away from the older "just in case" strategy where producers carried large inventories in case higher demand had to be met.
Elimination of Waste:
JIT usually indentifies seven prominent types of waste to be eliminated:
- Waste from overproduction
- Waste of waiting/idle time
- Transportation waste
- Inventory waste
- Processing waste
- Waste of motion
- Waste from product defects.
Sources - Investopedia and inventorysolutions.
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