1 JUST IN TIME SYSTEMS Figen KAS Dokuz Eylul University Industrial Engineering Department

2 Just-in-time (JIT) is easy to grasp conceptually, everything happens just-in- time. For example consider my journey to work this morning, I could have left my house, just-in-time to catch a bus to the train station, just-in-time to catch the train, just-in- time to arrive at my office, just-in-time to pick up my lecture notes, just-in-time to walk into this lecture theatre to start the lecture. Conceptually there is no problem about this, however achieving it in practice is likely to be difficult! WHAT IS JUST IN TIME?

3 In a manufacturing operation component parts could conceptually arrive just-in- time to be picked up by a worker and used. So we would at a stroke eliminate any inventory of parts, they would simply arrive just-in-time!

4 Similarly we could produce finished goods just-in-time to be handed to a customer who wants them. So, at a conceptual extreme, JIT has no need for inventory or stock, either of raw materials or work in progress or finished goods.

5 Obviously any sensible person will appreciate that achieving the conceptual extreme outlined above might well be difficult, or impossible, or extremely expensive, in real-life. However that extreme does illustrate that, perhaps, we could move an existing system towards a system with more of a JIT element than it currently contains.

6 HISTORY JIT originated in Japan. Its introduction as a recognised technique/philosophy/way of working is generally associated with the Toyota motor company, JIT being initially known as the "Toyota Production System". Within Toyota Taiichi Ohno is most commonly credited as the father/originator of this way of working. The beginnings of this production system are rooted in the historical situation that Toyota faced. After the Second World War the president of Toyota said "Catch up with America in three years, otherwise the automobile industry of Japan will not survive".

7 At that time one American car worker produced approximately nine times as much as a Japanese car worker. Taiichi Ohno examined the American industry and found that American manufacturers made great use of economic order quantities - the traditional idea that it is best to make a "lot" or "batch" of an item (such as a particular model of car or a particular component) before switching to a new item. They also made use of economic order quantities in terms of ordering and stocking the many parts needed to assemble a car.

8 BENEFITS OF JIT Reduced operating costs. Greater performance and throughput. Higher quality. Improved delivery. Increased flexibility and innovativeness.

9 THE JIT STRATEGY By taking a JIT approach to inventory and product handling, companies can often cut costs significantly. Inventory costs contribute heavily to the company expenses, especially in manufacturing organizations. By minimizing the amount of inventory you hold, you save space, free up cash resources, and reduce the waste that comes from obsolescence.

10 JIT SYSTEMS To facilitate a JIT approach, you need a variety of systems in place. The most notable is a kanban. This is a Japanese approach to ensuring a continuous supply of inventory or product. Kanbans were designed to support the JIT philosophy.

11 JIT also exists in concert with continuous improvement systems. Total Quality Management and Six Sigma are overarching programs that help you take a detailed look at every point of the production process and identify ways to make improvements. By applying JIT, you are continuously monitoring the production process. This gives you opportunities for making the production process smoother and more efficient.

12 KANBAN SYSTEM So

13 Rules: Every product comming out of fabrication is associated to a kanban card and conversely. A product is manufactured only to be associated to a kanban card, meaning if no stand alone kanban cards is waiting for its product, no manufacturing. A kanban card is physicaly located on the product, or waiting for it at production. Corrolary: if a kanban card is not in front of the machine, it's on the product. Consummer picking a product leaves the kanban. This isolated kanban become an order for a new product to replace the one wich was just picked up.

14 1. No kanban in front of machine means no order, so no production.

15 2. Kanban(s) in front of machine means as many orders than kanban cards, so production is required for equivalent quantity.

16 3. As soon as a product is manufactured, kanban is associated.

17 If many kanban cards wait in front of machine, it means equivalent number of products have been picked-up by consummer. It is time to manufacture the same quantity of products.

18 JIT AND STAKEHOLDER RELATIONSHIPS With JIT, it is necessary that you build strong ties with your supply chain. This will ensure that you have access to the supplies you need when you need them.

19 With a secure source of supplies, you can continue to make improvements in your production and inventory systems. This helps you to increase your responsiveness to customer demand. If you need to ramp up production, you can be confident knowing your suppliers will help you.

20 Custom orders are simpler with a JIT system. Instead of the customer's widget being built six months in advance and waiting on a shelf, it is built when it's ordered. By delivering product "just in time," you allow for last-minute changes.

21 Essentially, JIT allows your company to get the right products to the right customers at the right time. In many industries, this can give you a huge competitive advantage, at the same time that it helps you save a large amount of money.

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