JIT (JUST IN TIME) PULL SYSTEMS:

Just-in-time (JIT) is a management philosophy that originated in the 1970s. Taiichi Ohno is credited with developing JIT and perfected it for Toyota’s manufacturing plants in Japan. The main goal of JIT is to eliminate anything that does not add value from the customer’s perspective. Non-value-added activities are referred to as “waste” in JIT. Examples of waste include:

• Overproduction beyond what is needed to satisfy immediate demand
• Waiting time (work-in-process, customer waiting)
• Unnecessary transportation (material handling, customer travel through a facility, etc.) ? processing waste (yield rates, start-up costs)
• Inventory storage waste (space, deterioration, obsolescence, etc.)
• Unnecessary motion and activity (the waste in work techniques, etc.)
• Waste from product and service defects (rework, scrap, warranty, etc.)

There are three essential elements that contribute to the successful practice of JIT:

? JIT manufacturing principles

? Total Quality Management (TQM)

? Employee empowerment 

JIT manufacturing principles:

In a manufacturing setting, there are six major ways to pursue JIT goals: inventory reduction to expose waste, use of a “demand-pull” production system, quick setups to reduce lot sizes, uniform plant loading, flexible resources, and cellular flow layouts. 

Inventory reduction to expose waste:

The inventory covers up a lot of wasteful practices (poor equipment, weak vendors, bad quality, long setup times, etc.). By gradually lowering inventory, the weaknesses of the production system can be revealed and addressed one by one. Machines can be replaced or better maintained, vendor quality and delivery can be improved, machine setup procedures can be streamlined, quality practices can be implemented, and labor and equipment can be laid out more efficiently. These improvements permit the organization to operate with less inventory, less costs, and faster response times in meeting customer needs.

Demand-pull production system:

The traditional approach to manufacturing management promotes a strong focus on machine and labor utilization. The view was that if managers make sure that workers and machines are always busy, then surely the factory will be productive and efficient. This approach is called the “push” system of manufacturing, where raw material and work-in-process are continuously pushed through the factory in the pursuit of high utilization.

The problem with this approach is that it usually produces high levels of inventories, long lead times, overtime costs, high levels of potential rework, and workers who are competing with one another rather than working cooperatively.

In contrast to the push system, JIT espouses a “demand-pull” system that operates on the rule that work should flow to a work center only if that work center needs more work. If a work center is already occupied with work activity, the upstream work center should stop production until the downstream work center communicates a need for more material.

The emphasis on maintaining high utilization is removed in a JIT environment. The focus of a JIT environment is on addressing the challenges that affect the overall effectiveness of the factory (setup time reduction, quality improvement, enhanced production techniques, waste elimination, etc.) in meeting its strategic goals, rather than allowing excess inventory to cover up inefficiencies that reduce the factory’s competitiveness.

Quick setups to reduce lot sizes:

The longer it takes, and the more expensive it is to set up equipment and labor to produce an item, the greater the quantity of items that have to be produced in a given production run. Traditional production management philosophy promoted the notion that long production runs of the same item were the key to driving down unit costs.

The problem was that large production runs created large quantities of WIP and finished goods inventory that far exceeded the demand. These items would consequently cause high levels of inventory costs, long lead times, high potential rework, low flexibility in responding to customer needs, etc.

Uniform plant loading:

The successful practice of JIT means having the right quantities of the right products in the right place at the right time. Driving down setup times enables the company to produce the product mix and quantities that are demanded in the present time period.

Flexible resources:

The enemy of JIT is uncertainty. A JIT environment thrives on predictability in customer demand, production processes, suppliers, and workers. Of course, uncertainty cannot be completely eliminated in most organizational environments.

Line/cellular flow layouts:

Earlier in this chapter, we described the efficiencies that repetitive process layouts provide. Repetitive process layouts are perfectly suited for driving out non-value-added activities and transitioning to a JIT environment. Intermittent layouts feature dozens or even hundreds of different paths through the facility.

They are filled with complexity, uncertainty, and low visibility. Workers tend to have specialized skills, work independently of other departments, and have little sense of “ownership” of the products they work on.