Introduction:

.
Just-in-time (JIT) is a management philosophy that strives to eliminate
sources of manufacturing waste by producing the right part in the right place
at the right time. Waste results from any activity that adds cost without
adding value, such as moving and storing. JIT (also known as lean
production or stockless production) should improve profits and return on
investment by reducing inventory levels (increasing the inventory turnover
rate), reducing variability, improving product quality, reducing production
and delivery lead times, and reducing other costs (such as those associated
with machine setup and equipment breakdown). In a JIT system,
underutilized (excess) capacity is used instead of buffer inventories to hedge
against problems that may arise.

JIT applies primarily to repetitive manufacturing processes in which the

same products and components are produced over and over again. The
general idea is to establish flow processes (even when the facility uses a
jobbing or batch process layout) by linking work centers so that there is an
even, balanced flow of materials throughout the entire production process,
similar to that found in an assembly line. To accomplish this, an attempt is
made to reach the goals of driving all queues toward zero and achieving the
ideal lot size of one unit.

The goal of JIT, therefore, is to minimize the presence of non-value-adding

operations and non-moving inventories in the production line. This will
result in shorter throughput times, better on-time delivery performance,
higher equipment utilization, lesser space requirement, lower costs, and
greater profits.
JIT was developed as a means of meeting customer demands with minimum
delays. Thus, in the olden days, JIT is used not to reduce manufacturing
wastage, but primarily to produce goods so that customer orders are met
exactly when they need the products.

JIT is also known as lean production or stockless production, since the key
behind a successful implementation of JIT is the reduction of inventory
levels at the various stations of the production line to the absolute minimum.
This necessitates good coordination between stations such that every station
produces only the exact volume that the next station needs. On the other
hand, a station pulls in only the exact volume that it needs from the
preceding station.

The JIT system consists of defining the production flow and setting up the
production floor such that the flow of materials as they get manufactured
through the line is smooth and unimpeded, thereby reducing material
waiting time.

This requires that the capacities of the various workstations that the
materials pass through are very evenly matched and balanced, such that
bottlenecks in the production line are eliminated. This set-up ensures that the
materials will undergo manufacturing without queuing or stoppage.
Another important aspect of JIT is the use of a 'pull' system to move
inventories through the production line. Under such a system, the
requirements of the next station are what modulate the production of a
particular station. It is therefore necessary under JIT to define a process by
which the pulling of lots from one station to the next is facilitated.

JIT is most applicable to operations or production flows that do not change,

i.e., those that are simply repeated over and over again. An example of this
would be an automobile assembly line, wherein every car undergoes the
same production process as the one before it.

Some semiconductor companies have likewise practiced JIT successfully.

Still, there are some semiconductor companies that don’t practice JIT for the
simple reason that their operations are too complex for JIT application. On
the other hand, that’s precisely the challenge of JIT – creation of a
production set-up that is simple enough to allow JIT. (find a semi conductor
factory)

Inventory stocks allow production process to continue even when some

problem occurs. In a way, inventory stocks act like a buffers to hide any
problem that may occur. But, with JIT, there are no buffers to hide problems
and thus, occurrence of problem can shut down the entire production
process. Thus, JIT philosophy helps organization to prominently expose
problems and thus, bring a clear focus on removal of it at source, by
eliminating the cause, rather than effects, of problem.

With JIT, it is believed that the root causes of most problems are due to
faulty production process design. Hence, with JIT, nothing is taken for
granted, everything is subject to analysis.

Each activity is identified as either ‘Value-Added’ or ‘Non-Value-Added’.

The reduction of ‘Non-Value-Added’ activities is achieved mainly through
increasing manufacturing flexibility and improved quality.

JIT is an extremely powerful tool to identify where improvements should be

made. It helps you to identify cause (not the effect) of problem and its
elimination. Failures and exceptions are treated as opportunities to
improve the system. In fact, JIT initiates failures due to problems to expose
them. It is a system of trouble-shooting, within a culture of constant analysis
and improvement. It is clear, as an attitude and approach, JIT and TQM are
perfectly complimentary to each other, to expose and correct problems at
source, so as to avoid wasting resources on production of defective products.

Just-in-time manufacturing is a process where suppliers deliver inventory to

the factory only when it's needed for assembly. Companies are beginning to
turn to Internet-based technologies to communicate with their suppliers,
making the just-in-time ordering and delivery process speedier and more
flexible.

History of Just in Time:

Just-In-Time is a Japanese manufacturing management method developed in
1970s. It was first adopted by Toyota manufacturing plants by Taiichi Ohno.
The main concern at that time was to meet consumer demands. Because of
the success of JIT management, Taiichi Ohno was named the Father of JIT.

After the first introduction of JIT by Toyota, many companies followed up

and around mid 1970s’, it gained extended support and widely used by many
companies.

One motivated reason for developing JIT and some other better production
techniques was that after World War II, Japanese people had a very strong
incentive to develop a good manufacturing techniques to help them
rebuilding the economy. They also had a strong working ethnic which was
concentrated on work rather than leisure, seeked continuous improvement,
life commitment to work, group conscious rather than individualism and
achieved common goal. This kind of motivation had driven Japanese
economy to succeed.

Because of the natural constraints and the economy constraints after World
War II, Japanese Manufacturers looked for a way to gain the most efficient
use of limited resources. They worked on "optimal cost/quality relationship".

Before the introduction of JIT, there were a lot of manufacturing defects for
the existing system at that time. According to Hirano, this included
inventory problem, product defects, risen cost, large lot production and
delivery delays. The inventory problems included the unused accumulated
inventory that was not only unproductive, but also required a lot of effort in
storing and managing them. Other implied problems such as parts storage,
equipment breakdowns, and uneven production levels.

For the product defects, manufacturers knew that only one single product
defects can destroy the producer’s creditability. They must create a "defect-
free" process.
Instead of large lot production - producing one type of products, they
awaked that they should produce more diversified goods. There was also a
problem of rising cost, the existing system could not reduce cost any further
but remember improvement always leads to cost reduction.

Lastly, the existing system did not manage well for fast delivery request, so,
there was a need to have a faster and reliable delivery system in order to
handle customers’ needs.

Thus, JIT manufacturing management was developed based on these

problems.
Focus of JIT?

Mainly JIT focuses to eliminate the waste or the non-value added. Thus
there are several types of wastes categorised. JIT usually identifies seven
prominent types of waste to be eliminated:

 Waste from Overproduction

 Transportation Waste
 Processing Waste
 Waste from Product Defects
 Waste of waiting/idle time
 Inventory Waste
 Waste of Motion

Introduction Phase for Just in Time:

According to Hirano, the introductory phases of JIT involve 5 steps.

STEPS IN THE INTRODUCTORY PHASE OF JIT

Step 1: Awareness Revolution
It means giving up old concept of managing and adopting JIT way of
thinking. There are 10 principles for improvement:

1. Abolish old tradition concepts.

2. Assume that new method will work.
3. No excuses are accepted.
4. It is not seeking for perfection, absolutely zero-defect process, few defects
is acceptable.
5. Correct mistakes immediately.
6. Do not spend money on improvement.
7. Use you brain to solve problem.
8. Repeat to ask yourself 5 times before any decision.
9. Gather information from several people, more is better!
10. Remember that improvement has no limits.

The idea of giving up old concept was especially for the large lot production,
The lot production was felt that "having fewer changeover was better", but it
was no longer true. Whereas JIT is a one-piece flow manufacturing. To
compare the two, Hirano had this idea:

Lot production: "Unneeded goods...In unneeded quantities...At unneeded

times..." JIT: "Needed goods...In needed quantities...At needed times..."

The main point here is to have an awareness of the need of throwing out old
system and adopting a new one.

Step 2: 5S’s For Workplace

Improvement
The 5S’s stand for:
Seiri - Proper Arrangement
Seiton - Orderliness
Seiso - Cleanliness
Seiketsu - Cleanup
Shitsuke – Discipline

This 5S’s should be implemented company-wide and this should be part of a

total improvement program.

Seiri - Proper Arrangement means sorting what you have, identifying the
needs and throwing out those unnecessary.

One example is using red-tags. This is a little red-bordered paper saying

what the production is, how many are accumulated and then stick these red
tags onto every box of inventory . It enhances the easiness to know the
inventory status and can reduce cost.

Seiton - Orderliness means making thing in order. Examples include

keeping shelves in order, keeping storage areas in order, keeping workplace
in order, keeping worktables in order and keeping the office in order.

Seiso - Cleanliness means having a clean workplace, equipment, etc.

Seiketsu - Cleanup mean maintaining equipment and tools.

Shitsuke - Discipline means following the rules and making them a habit.
Step 3: Flow Manufacturing

Flow

manufacturing means producing one single piece of product at a time but

multi-handling which follows the process sequence.

There are several main points concerning flow manufacturing:

1. Arrange machines in sequence.
2. U-shaped production line (Cellular Manufacturing).

3. Produce one-piece at a time.

4. Train workers to be multi-skilled.
5. Follow the cycle time.
6. Let the workers standing and walking around while working.
7. Use small and dedicated machines.

Step 4: Standard Operations

Standard Operation means to produce quality safely and less expensively
through efficient rules and methods of arranging people, products and
machines.

The basis of standard operations is:

1. Cycle time It means how long it would take to "carry out part all the
way through the cell". Following are the equations for calculating
cycle time.

Daily Quantity Required = Monthly Quantity Needed / Working Days per

month

Cycle Time = Working Hours per day / Daily Quantity Required

2. Work sequence

3. Standard stock-on-hand

4. Use operation charts

Step 5: Multi-Process Handling

Multi-process handling means one worker is responsible for several
processes in a cell.
Some points that should be aware:

· Clearly assign jobs to machines and workers.

· Make a good use of U-shaped cell manufacturing.
· Multi-skilled workers
· Operation should be able to perform multi-machine handling and multi
process handling.
Multi-machine handling - a worker should handle several machines at once,
this is also called "horizontal handling".

Multi-process handling - a worker should handle several different processes

at once, this is also called "vertical handling" and this is the basis for JIT
production.

· Uses casters extensively as author written, "Floor bolts are our enemies!
Machines must be movable."
Elements of Just in Time

According to Cheng, the basic elements of JIT manufacturing are:

· People Involvement
· Plants
· System

People Involvement

Maintaining a good support and agreement from people involved in

production. This is not only reduce the time and effort in implementation of
JIT, but also minimize the chance of creating implementation problem. The
attempt to maximize people’s involvement may carry through the
introduction of quality circle and total involvement concept.

Manufacturers can gain support from 4 sources.

1. Stockholders and owners of the company - should maintain a good

long-term relationship among them.

2. Labor organization - all labors should be well-informed about the

goals of JIT, this is crucial in gaining support from the them.

3. Management support - support from all level of management. The

ideas of continuous improvement should spread all over the factory,
managers and all shop-floor labor.

4. Government support - government can show their support by

extending tax and other financial help. This can enhance the motivation,
and also help in financing the implementation of JIT.
Plants

Certain requirements are needed to implement JIT, there are:

1. Plant layout - the plant layout is mainly focus on maximizing working

flexibility. It requires the use of "multi-function workers".

2. Demand pull production - it means to produce when the order is received.

This can manage the quantity and time more appropriately.

3. Kanban - a Japanese term for card or tag. Special inventory and process
information are written on the card. This helps tying and linking the process
more efficiently.

4. Self-inspection - it is carried out by the workers at catch mistakes

immediately.

5. Continuous improvement - this concept should be adopted by every

members in the organization in order to carry out JIT. This is the most
important concept of JIT. This can allow an organization to improve its
productivity, service, operation and even customer satisfaction in an on-
going basis.

System

This refers to the technology and process that combines the different
processes and activities together. Two major types are MRP(Material
Requirement Planning) and MRP II (Manufacturing Resource Planning).

MRP is a computer-based, bottom-up manufacturing approach. This

involves two plans, production plan and master production schedule.
Production plan involves the management and planning of resources through
the available capacity. Master production schedule involves what products to
be produced in what time.

MRP II is mainly involved the management or planning of financial

resources in order to carry out the operation.
Goal of Just in Time
According to Cheng in Just-In-Time Manufacturing – An Introduction, he
explains the objectives of JIT. There are three main objectives:

1. Increasing the organization’s ability to compete with others and remain

competitive over the long run. The competitiveness of the firms is increased
by the use of JIT manufacturing process as they can develop a more optimal
process for their firms.
2. Increasing efficiency within the production process. Efficiency is obtained
through the increase of productivity and decrease of cost.
3. Reducing wasted materials, time and effort. It can help to reduce the costs.

Other short-term and long-term objectives are:-

1. Identify and response to consumers needs. Customers’ needs and wants

seem to be the major focus for business now, this objective will help the
firm on what is demanded from customers, and what is required of
production.

2. Optimal quality/cost relationship. The organization should focus on zero-

defect production process. Although it seems to be unrealistic, in the long
run, it will eliminate a huge amount of resources and effort in inspecting,
reworking and the production of defected goods.

3. Reduce unwanted wastes. Wastes that do not add value to the products
itself should be eliminated.

4. Develop a reliable relationship between the suppliers. A good and long-

term relationship between organization and its suppliers helps to manage a
more efficient process in inventory management, material management and
delivery system. It will also assure that the supply is stable and available
when needed.

5. Plant design for maximizing efficiency. The design of plant is essential in

terms of manufacturing efficiency and utility of resources.

6. Adopt the work ethnic of Japanese workers for continuous improvement.

Commit a long-term continuous improvement throughout the organization.
It will help the organization to remain competitive in the long run.
Other Similar Ideas

1. Reduction of Inventory. JIT reduces inventory at all level of the

organization.

2. Reduction of Lead Time. Lead time such as setup time and move time and
waiting time is reduced.

3. Quality Control. JIT improves the quality control by increasing its

efficiency of managing shop floor production and increasing its commitment
to its suppliers.

4. Improvement for Performance. In JIT manufacturing, the organization can

obtain a greater impact/control over its suppliers. With fewer suppliers,
organizations have larger control because the amount purchased is usually
large. And, organizations can obtain a tighter requirement on products from
their suppliers.

5. Total Preventive Maintenance. JIT provides preventive maintenance to

lessen the risk of machine breakdowns.
6. Continuous Improvement. JIT is a never-ending method in operation
management.

7. Strategic Gain. JIT helps organization to remain competitive in the market

place.

8. Reduction of Wastes. JIT helps significantly in reducing wastes.

JIT can help organization remains competitive by offering consumers higher

quality of products than their competitors, it is very important in the survival
in the market place.

These major objectives are suitable for all organizations. But each
organization is unique in some way, adjustments of JIT objectives for each
form should be made in order to complement the overall production process.
Limitation of Just in Time
Regardless of the great benefits of JIT, it has its limitations, the following
are the major limitations.

· Culture Differences The organizational cultures vary from firm to firm.

There are some cultures that tie to JIT success but it is difficult for an
organization to change its cultures within a short time.

· Traditional Approach The traditional approach in manufacturing is to store

up a large amount of inventory in the means of backing up during bad time.
Those companies rely on safety stocks may have a problem with the use of
JIT.

· Difference in implementation of JIT Because JIT was originally established

in Japanese, it is somehow different for implementing in western countries.
The benefits may vary.

· Loss of individual autonomy. This is mainly due to the shorter cycle times
which adds pressures and stress on the workers.

· Loss of team autonomy. This is the result of decreasing buffer inventories

which lead to a lower flexibility of the workers to solve problem
individually.

· Loss of method autonomy. It means the workers must act some way when
problems occur, this does not allow them to have their own method to solve
a problem.

· JIT success is varied from industry to industry. Some industries are benefit
more from JIT while others do not.

· Resistance to change JIT involves a change throughout the whole

organization, but human nature resists to changes. The most common
resistances are emotional resistance and rational resistance. Emotional
resistance are those psychological feeling which hinder performance such as
anxiety. Rational resistance is the deficient of the needed information for the
workers to perform the job well.
Some other limitations:-

· Relationship between management and employees is important .A mutual

trust must be built between management and employees in order to have
effective decision making.

· Employee commitment Employees must commit to JIT, to enhance the

quality as their ultimate goal, and to see JIT as a way to compete rather than
method used by managers to increase their workload.

· Production level JIT works best for medium to high range of production
volume.

· Employee skill JIT requires workers to be multi-skilled and flexible to

change.

· Compensation should be set on time-based wages. This allows the workers

to concentrate on building what the customers wants.
JIT - Philosophy or Technique????

Just In Time is a philosophy and not the technique for elimination of wastes.
The JIT strategy is to have "the right product at the right place at the
right time."

The Just-in-time philosophy that emerged, is a management logic based on

simplicity and continuous improvement. It may be applied to any process
where it will aim to make improvements through elimination of excess,
waste and unevenness.

The Just-in-Time concept comprises methods and techniques that aim to

increase the potential for short times to delivery.

Production system in which both the movement of goods during production

and deliveries from suppliers are carefully timed so that at each step of the
process the next (usually small) batch arrives for processing just as the
proceeding batch is completed

The "Just in time" (JIT.) inventory concept, also called Kanban, asserts that
just enough inventories, arriving just in time to replace that which was just
used, is all the inventory that is necessary at any given time. Excessive
inventory unnecessarily ties up money, adds warehousing costs, increases
risk of damage and risks obsolescence, and most of all, can possibly obscure
opportunities for operational improvements.

Storing inventory is still the basics of warehousing, but in today’s business it

constitutes only part of the total. A modern thought on warehousing is that
large inventories are really not as necessary as once believed.

To some companies storing large quantities of inventory is detrimental to

business because it ties up capital and can also disguise poor management
practices. The JIT philosophy emphasizes flow flexibility and developing
supply chains to reduce all excess and waste
Implementation Of JIT

Although the just-in-time (JIT) concept is very young, perhaps 10 to 15

years old in this country, it is so widespread in American manufacturing and
service. Perhaps this is because the idea is so simple and so appealing. In
short, the JIT strategy is to have "the right product at the right place at the
right time." It implies that in manufacturing or service, each stages of the
process produces exactly the amount that is required for the next step in the
process. This notion holds true for all steps within the system.

Suppose, for example, that all products pass through a drilling operation and
then a milling operation. With JIT, the drill produces only what the mill will
need next. It also holds for the last step that is, the system produces only
what the customer desires.

Implementation of a JIT system typically includes emphasis on the

following aspects of the production process:

Production Smoothing

Capacity Buffers

Set-up Reduction

Cross Training and Plant Layout

Total Quality Management

Most of the companies today seek this method of implementation:

Form a top-level team:

This team’s responsibilities include deciding upon an organizational

structure and developing a plan to implement JIT within the company. This
plan should include the company’s goals concerning production, as well as
how to establish this plan among all employees (i.e. motivation & discipline)
This plan then be used to establish the overall philosophy of the company
concerning JIT

To train the top management in the basic concepts of JIT:

This is the first step of the implementation process. It is very important to

educate and train the top-level management, as they are the ones who frame
policies and get things moving. This being a new idea, getting this into
practice will need full support & cooperation from these people.

To implement this system to every aspect of the company from supplier

to distributors:
First of all each department should establish its goals and a specific problem
to attack. Then a team should be chosen by each department and establish
team leaders. The teams should focus on the reduction of costs and the
elimination of wastes. Data must then be collected on the team’s problems.
This data should be plotted in order to find excess waste or costs. Once this
is done, measurement should be plotted in order to find excess waste or
costs. Once this is done, measurement should be made. Manipulation of this
data should show at least some apparent problems in the current system.
Further analysis should help in the implementation of JIT by showing
problem areas. In addition, the data the data could be used to show the
effects of implementing JIT into the company.

Guidelines for Successful JIT Implementation

Make the factory loadings uniform, linear, and stable. Fluctuations in

manufacturing loadings will result in bottlenecks.

Reduce, if not eliminate, conversion and set-up times.

Reduce lot sizes. This will smoothen out the flow of inventories from one
station to another, although this may necessitate more frequent deliveries or
transfers.
Reduce lead times by moving work stations closer together and streamlining
the production floor lay-out, applying cellular manufacturing concepts, using
technology to automate processes and improve coordination.

Reduce equipment downtimes through good preventive maintenance.

Cross-train personnel to achieve a very flexible work force.

Require stringent supplier quality assurance since an operation under JIT can
not afford to incur errors due to defects.

Use a control system to convey lots between workstations efficiently; the

use of a kanban system is an example of this

Benefits of JIT

Perhaps, the most significant benefit of JIT is to improve the responsiveness

of the firms to the market place thereby affording it an overwhelming
advantage in competition. Specific benefits will depend upon size of the
market, technology of processes etc. Therefore, they vary from organizations
to organization.

One of the benefits of JIT is that with raw materials and WIP being
processed in smaller batches, errors can be easily identified and corrected
quickly, during each stage of the production process. This in turn has the
‘knock-on’ effects of reducing non-value added costs
Conceptually, the JIT benefits could be grouped into the following
categories;

Product Cost: This is greatly reduced of manufacturing cycle time,

reduction of scraps, inventories, space requirement, and material handling
and eliminations of non-value adding operations.

Quality: It has greatly improved due to fast detection and correction of

defects, use of automatic stop devices, higher quality of purchased parts,
worker centered quality control and statistical process control. Total
preventive maintenance an d lower inventory levels also help in quality
improvements.

Design: Due to fast response to engineering change, alternative designs can

be quickly brought on the shop floor.

Productivity: Order magnitude productivity improvements are obtained due

to the use of flexible workforce, reduced rework, reduced inspection,
reduced part delay and reduced throughout time. Workers acquire multiple
skills and become highly productive.
JIT systems have a number of other important benefits also, which are
attracting the attention of various companies. The main benefits are:

• Reduced levels of in-process inventories, purchased goods, and

finished goods.

• Reduced space requirements.

• Increased product quality and reduced scrap and rework.

• Reduced manufacturing lead times.

• Greater flexibility in changing the production mix.

• Smoother production flow with fewer disruptions.

• Worker participation in problem solving.

• Pressure to build good relationships with vendors.

• Increased productivity levels and utilization of equipment.

10.Reduction in the need for certain indirect labour.
Just In Time (JIT) Manufacturing

Just in Time manufacturing is a systems approach to developing and

operating a manufacturing system. It is based on the total elimination of
waste. JIT is not a new concept. It has been part and parcel of the Japanese
manufacturing industry adopted approach for quite some time. It requires
that equipment, resources and labor are made available only in the amount
required and at the time required to do the job. It is based on producing only
the necessary units in the necessary quantities at the necessary time by
bringing production rates exactly in line with market demand. In short, JIT
means making what the market wants, when it wants it. JIT has been found
to be so effective that it increases productivity, work performance and
product quality, while saving costs.
JIT AND COSTS

JIT can affect the bottom line in a variety of ways. Improvement in quality
and delivery times can increase demand and, thus, revenue. Costs are also
affected; the JIT philosophy contends that inventory reduction and increased
quality reduce costs. Traditional cost accounting Systems often makes it
difficult to measure the effects of changes except in very aggregate terms.
One of the tenets of JIT is to account for these effects more accurately.

Cost Accounting Systems

Costs are a major factor in PIM decisions. Unfortunately, traditional cost

accounting Systems often do not tell the decision maker how much a
specific decision wilt affect actual expenditures. This is due to overhead
costs being hidden by the allocation methods.

For example, overhead costs usually are allocated to departments (cost

centres) rather than to activities, such as set-up, and inspection and
maintenance operations. In addition, allocation based on the material or
directs labour required to manufacture an item ignores the fact that different
items are in different stages of their life cycles.
Thus, different items may have different manufacturing, engineering, and
tooting costs, may have quite different quality and inspection requirements,
and may require different marketing and distribution expenditures. When
these costs are aggregated and allocated on the basis of the average direct
labour cost of a part-as is the case with most traditional cost accounting
systems-some products are allocated costs considerably below the actual
expenditures required for their manufacture and distribution and others are
allocated more than their true cost. Thus, decisions often are based on
inaccurate information.

In order to manage costs and base decisions on accurate information, the

causes (source) of the expenditures must be identified. Various expenditure
causes; such as set-up times, shop and purchase order processing, receiving,
and material handling deserve more discussion.

These basic causes of indirect costs are called cost drivers. The cost
accounting system must report the cost of these activities to accurately
determine the costs of individual products. Such reporting enables
manufacturing management to treat set-up, inspection, receiving, and
transaction costs as direct costs, to base decisions on accurate information,
and to focus on reducing high cost elements. An ABC analysis can be used
to select the activities that are appropriate for cost reduction studies.
 JIT, TQM, AND THE PRODUCTION PIPELINE

Think of a company as a pipeline with raw materials entering at one end and
products emerging at the other.( the pipe can be extended conceptually with
customer needs or orders going in at one end and products arriving to
customers at the other.)

The goal is to minimize the through put time, that is to move the materials as
quickly as possible Shorter throughput time is better But the pipeline varies
in size and has obstructions through out. Output is determined by the
narrowest part of the pipeline and the biggest obstruction.

These must be identified and then eliminated to achieve the goal. As each
obstruction is eliminated the flow speeds up but only by as much as allowed
by the next biggest obstruction elsewhere in the pipeline.

Identification and location of these obstructions, understanding them, and

finding ways to eliminate them are the purposes of JIT and TQM. The
pipeline analogy may give an impression those barriers to flow / production,
once removed is gone forever. This is not true. To identify the obstruction
and its precise location in itself is difficult and time consuming
Inventory as a way of avoiding problems

Sources of obstructions keep changing and it could be any one of the factors
of production and /or in any combination of the factors. One gets eliminated
and another one crops up and therefore it has got to be continuously attended
to.

The pipeline itself and the things that floe through are changing always. The
diameter of the pipeline may have to be changed. But only the extent
required. Over size is waste, while undersize would not meet the required
throughput.

The BEST flow rate would be that which matches the required output rate.

At times the pipeline itself may have to be modified or even replaced. As

changing processes and products introduce whole new set of obstructions.

In short the work on the pipeline is CONTINUOUS. JIT and TQM

continuously enable tinkering the pipeline so that the material coming out of
the pipeline is the best possible in all respects.
 JIT / TQM Difference in Organizations.

JIT /TQM greatly increase the number of people who are involved in
identifying and eliminating obstructions. Every one does it Level of
authority of workers to make and carry out decisions is much higher
Emphasis is on measure, diagnose, and improve it.

Second difference is in the process employed to identify and prioritise

problems and sources of waste

In JIT the primary process is reduction of inventory, mainly to reveal the

obstructions (which were earlier hidden or ameliorated by the inventory) and
prioritise them.
Just in Time Summary

Efficient Techniques Reduce Leeway (Maintaining

Continuity)
1. Prepare a disaster plan, e.g. firing protection or backing-up data. He
believes that the better the disaster plan, the larger chance the companies
will survive after disaster.

2. Cost -reduction strategies.

3. Develop long-term continuity plan.

4. Identify critical functions and estimate the time, the company can afford
without such function.

5. Identify potential alternative suppliers.

6. avoid too complicated continuity plan.

7. Evaluate risk before any decision.

8. Conducting continuity tests.

Just in Time-----Manufacturing
(1) Introduction

Just in Time---manufacturing is a systems method to develop and operate a

factory system. It is mainly basis on the total Decrease of waste. As you
know, many people think JIT is not a new knowledge field. As a matter of
fact, it has been part and plays an important role of the Japanese
manufacturing industry adopted method for a long time. It requires all the
materials such as equipment, human resources, and management skills are
made available only in the amount required and at the time required to do
the job. It is based on producing only the necessary units in the necessary
quantities at the necessary time by bringing production rates exactly in line
with market demand. Generally speaking, JIT means making what the
market wants. JIT has been found to be so effective that it increases
productivity, work performance and product quality. What’s even more, it
plays a vital role to increase productivity and decrease the total cost of
manufacturing production.

(2) Planning for JIT

Since each manufacturing process is different, it is up to the individual

company to determine the degree of appropriateness and the final
application of JIT. However, it is very important to define the plan and
objectives before setting up a JIT manufacturing system. It is impossible to
establish a new JIT system that can be used successfully without change.
Therefore, we should take serious consideration to make a plan for Just-In-
Time, which will benefit to our factory performance.

(3) Defining the Planning

JIT manufacturing system requires an understanding of the objectives of JIT,

and objectives of the JIT system. After the objectives are set up for the
manufacturing, the process of planning becomes one of determining what is
required to meet those objectives. The goal of a JIT approach is to develop a
system that allows a factory to have only the materials equipment and people
by hand required doing the some plan. T o achieve this goal, we should have
equipped with at least five fundamental plan:

· Integrating and optimizing every step of the manufacturing process ·

Reducing manufacturing cost · Producing product on demand · Developing
manufacturing flexibility · Produce quality product to maintain
commitments and links made between Customers and Suppliers

We also should keep in mind that achieving these obtaining targets does not
automatically make a company a JIT manufacturer. On the contrary, it will
lead to achieve even one of these objectives will prevent a manufacturer
from establishing a successful JIT system. According to Common Wealth on
May, 1996 report, it said that “A company cannot decide to implement JIT;
they must earn the right to use JIT by revising their quality for system."

(4) Reducing Manufacturing Cost

If we can design products that it will speed up and decrease manufacturing
processes. Gradually, it will help us to reduce the cost of manufacturing and
building the product to specifications benefit. One aspect in designing
products for manufacture ability is the need to set up a good boss and
employee relationship. At least, this is to cultivate and procure the resources
of the production experts, and the line employees to develop cost saving
solutions. Participatory quality programs utilize employee knowledge about
their job functions and review the department performance. It will, finally,
encourage with rewards for suggested total cost saving.

(5) Manufacturing Flexibility

According to China time report on August 1996. "Manufacturing flexibility

is the ability to start new projects or the rate at which the production mix can
be adjusted to meet customer demand." Planning for manufacturing
flexibility requires the understanding of the elements in the manufacturing
process and understanding elements in the process that restrict flexibility and
improving on these areas. The unique feature of Just-In-Time is the
modification from between pull and push systems. The main idea behind
these approaches is that "work should not be pushed on to the next worker
until that worker is ready for it." (Hauser, J.R.) As a result, manufacturing
flexibility requires production managers to consider the some important
factors, such as supplier lead time, production process time, process setup
time and so forth.

(6) Keep in touch between customers and suppliers

For factory main commitment to achieving the internal structures, both

customer and supplier are also playing a vital role to support JIT
manufacturing. Because it is the primary requirement for developing the JIT
system, each other can establish trust and honest between the supplier and
the customer which is a must, since every Just-in-Time operation depends on
it. Supposed, finally, it leads to failure to keep the commitments each other.
Finally, it will be result to a serious form of breakdown manufacturing
systems. Therefore, we should pay attention to this kind of serious call.
Never be ignorant of this commitment. If we can make use of Just-In-Time
(manufacturing approaches), it, eventually, will attain those goal, which are
the fundamental concept of producing product only as needed or on demand.

AUTO ANALYSIS

Kanban Just-in-Time at Toyota

INTRODUCTION:

When we talk about Kanban Just-In-Time, you maybe have a question

which company set a very good example to fulfill this approach. The answer
is Japanese company ------Toyota. Not only did Toyota take advantage of
Kanban Just-In-Time, but it also get a very good benefit to operate its
company. Kanban just-In-Time helps companies solving many
Manufacturing problems. Kanban derives it name from the manufacturing
systems and processes implemented at Toyota Motor Manufacturing that are
so effective at producing at low cost, high quality, and short cycle times. As
a consequence, these systems are highly flexible and responsive to customer
requirements. Toyota capabilities are listed below. Kanban Just-In-Time
impact on whole Toyota production approach as following:

(a) Standardized work

Manufacturing Cells

Manufacturing Lines

Facility Layout

Technology Development

Simulation of processes and systems

(b) Quality Improvement

In Process Inspection

Experimental Design
Process Development

(c) Continuous Improvement

Example:

Toyota manufacturing processes route the product around the plant to

various work centers where work is staged to be processed. Implementing
manufacturing cells typically increases net income dramatically and reduces
cycle time over 50%. The cost of design and implementation is usually
recovered within the first year from inventory savings. In this paper, we
present the benefits of bringing the processes to the product and discuss the
value of simulation as a tool to design and predict cell performance prior to
implementation; therefore, reducing financial and technical risk to the
company.

On September 10, 1997, Mr. Hoskins presented on "Improve Profits and

Reduce Cycle Time with Manufacturing Cells and Simulation" for the
National Technology University series on Kanban just-In-Time
Manufacturing of this series. On October 27 - 28, 1996 Jerry Hoskins,
President presented a paper titled "Developing a Lean Implementation
Roadmap" at the SME Kanban Manufacturing Conference in Dearborn,
Michigan. The intent of this paper is to provide information to companies on
where to start with a Kanban implementation based on where one is
currently manufacturing operation. His theory help our many manufactures
implement all the elements of Kanban Manufacturing directed at elimination
of manufacturing waste as defined by the Toyota Production System. These
systems are more flexible, responsive, and profitable than traditional
manufacturing systems. And, its theory also help our many participate
determine where best to start with a Kanban implementation which usually
involves an assessment of current operations. Once plan is developed we
design the system to be implemented which may involve layout, cells, JIT,
process technology, and process simulation.
Conclusion:

To sum up, we should make fully use of Kanban in order to improve the
performance of a production line which is under controlled by Kanban.
Generally speaking, Kanban is combined with base stock or immediately
improvement to create a hybrid production control system. Simulation
results based on a Toyota factory show that this policy meets throughput
targets with significantly lower inventories than Kanban alone. As a result,
Toyota research considers a line production system which purchases raw
materials from a supplier, processes them into finished products and delivers
them to a buyer just in time. This study focuses on finding the optimal
number of raw material orders, finished goods deliveries and Kanbans
between work stations for a time-proportionate demand of finished goods.
Just In Time in Ford

EXECUTIVE SUMMARY
In this paper, we are examining the implementation of Just-In-Time
methodology in Ford for its latest small car KA; possibly one of the most
interesting manufacturing revolution where companies involved in the
production are integrated not only in their business processes moreover in
their physical plants. The concept has been successfully developed and
implemented in Valencia, Spain and is due to be adopted in other Ford
production plants. The case study clearly shows how companies can work
together in a harmonic and synchronised system meeting probably the most
idealistic manufacturing principles (JIT) to produce the best quality product
within the shortest time frame with minimum/no wastage and cost-effective
to all parties. Careful production planning, cost-benefit analysis, adequate
outsourcing plans and customer orientation are being praises as the key
success factors of this amazing Just-In-Time concept.
FORD KA IN JUST IN TIME
Production of Ford latest small car, the Ford KA has been a dramatic
improvement compared to Ford previous product, Fiesta (Kochan, 1997).
This is a real example of successful JIT implementation with all its
outsourcing strategies. The production target of 1,100 KA cars per day has
been reached only within 8 weeks since the launch date, compared to 15
weeks required for Fiesta. Ford found that the initial bottleneck was caused
by material handling, assembly time and inbound logistic. Some of the
components in Fiesta are supplied by various suppliers and these
components had to be made, loaded in the container and scheduled for
delivery before finally delivered by trucks. This common process is found to
be inefficient as every part has to be continuously handled by human and
this causes big risks of damages, misplaced and imperfection in quality,
especially for cosmetically sensitive and fragile parts such as instrument
consoles, electrical wiring and airbags.

With the new developed JIT system supported with sophisticated aerial
tunnels connecting Ford with its suppliers, production lead times can be
minimised, product quality can be improved, responsiveness towards
customer demands can me boosted and the most important thing is
inventory, space requirements, handling and transportation cost can be
dramatically reduced (Kochan, 1997). Ford is now connected with more than
50 suppliers in Valencia with specifically designed aerial tunnels. These
tunnels are also very useful to transport bulky and heavy items such as seats
and fuel tank. The brain of this amazing system is DAD (direct automated
delivery) which will integrate the whole processes virtually as one extended
manufacturing warehouse. DAD will enable a smooth manufacturing
process by applying Ford scheduling system so that all the supplied
components being delivered right on time they are needed. In addition, DAD
and its tunnels enable the integration of manufacturing equipment so that the
component being delivered can be immediately installed with the main body
or other components in Ford factory.

Summary of Ford Valencia manufacturing system

prior JIT implementation:

• Minimum of 15 weeks to reach full production capacity

• Required at least 3,000 parts to be assembled for each car
• Very small outsourcing involve for car components
• All parts from suppliers are delivered on trucks
• Stock must be kept at certain level to assure the continuity of
production
• Parts are often damaged during packaging, handling or delivery
• Spent over $6 million for inefficient delivery system (250+ trucks per
day)
• 80 per cent automation in overall
• Manual seats and battery placement and this may cause injury for
employee

In a dynamic market trends, pre-JIT system clearly is not responsive enough

as an answer. There are minor inefficiencies throughout the system which
accumulate into serious problem that may cause Ford being less competitive
in the market.

IMPROVEMENT PROCESS ANALYSIS

The main objectives of JIT are obtaining low-cost high quality products and
on-time production as well as eliminating waste and stagnant stock
(Svensson, 2001). Even though most of JIT implementation has similar aim
and purposes, the strategies involved may differ from industry to industry or
company to company. Ford has smartly chosen the right methods and
strategies by reducing the barriers in relation with its suppliers.

Through JIT, Ford is achieving the highest efficiency in car manufacturing

industry. Its plant in Valencia has become the standard and being adopted in
its other plants in many other countries. Apart from its tangible benefits such
as saving on transport costs, stock/inventory costs, quicker manufacturing
process and minimised risk/wastage, JIT will also bring immediate
intangible benefits such as improved customer satisfaction through
immediate responses and shorter timeframe to respond towards market
trends.
Improvements being achieved through JIT
implementation:

• Only 8 weeks required to reach full production capacity

• Only 1,200 parts need to be assembled, the rest have been done by its
suppliers
• All the outsource-viable production parts are outsourced
• Automatic delivery system and aerial tunnels are developed to
minimise transport
• There is barely any stock required as most parts are made to order
• The whole manufacturing process including the suppliers are working
as one system
• The need of conventional truck delivery is minimum
• 98 per cent automation
• Seats and battery placement are being done by automated high-
precision machines

There is not enough detail to measure the benefit of JIT implementation

against the pre-JIT system, however from rough analysis Ford will gain the
benefit immediately and get the investment back in virtually no time.
JIT COST/BENEFIT ANALYSIS FOR FORD
VALENCIA

COSTS BENEFITS
• Extending outsourcing (losing control) • Speed-up production process 8 weeks
• $500 million pilot plan and analysis • Smaller number or manufacturing parts
• Concentrating on core business
functions
• 25% shorter time production time
needed
• Accuracy of production on plan
• Building aerial tunnels • Less handling = less damages / costs
• Setup Direct Automated Delivery DAD • Less conventional transport dependent
• $16 million delivery system • Time saving
• Manufacturing seamless integration
• Further interest from more suppliers
• Saving $6+ million per year on
transport
CONCLUSION
In this paper, we examined the implementation of Just-In-Time methodology
in Ford for its latest small car KA; possibly one of the most interesting
manufacturing revolutions where companies involved in the production are
integrated not only in their business processes moreover in their physical
plants. JIT has shown it success to produce the best quality product within
the shortest time frame with minimum/no wastage and cost-effective to all
parties. Careful production planning, cost-benefit analysis, adequate
outsourcing plans and customer orientation are being praises as the key
success factors of this amazing Just-In-Time concept.
General Motors
An example of the use of JIT in General Motors is given below.

General Motors (GM) in the USA has (approximately) 1700 suppliers who
ship to 31 assembly plants scattered throughout the continental USA. These
shipments total about 30 million metric tons per day and GM spends about
1,000 million dollars a year in transport costs on these shipments (1990
figures).

JIT implies frequent, small, shipments. When GM moved to JIT there were
simply too many (lightly loaded) trucks attempting to deliver to each
assembly plant. GM's solution to this problem was to introduce
consolidation centres at which full truckloads were consolidated from
supplier deliveries.

This obviously involved deciding how many consolidation centres to have,

where they should be, their size (capacity) and which suppliers should ship
to which consolidation centres (suppliers can also still ship direct to
assembly plants).

As of 1990 some 20% by weight of shipments go through consolidation

centres and about 98% of suppliers ship at least one item through a
consolidation centre.

All this has been achieved without sacrificing the benefits of JIT.