Just-In-Time is a doctrine that is aimed at cut downing the stock list, wastes and other transporting cost and the techniques adopted to accomplish this in bend helps in maximising the efficiency and productiveness. There are requirements to the successful execution of Just-In-Time and the organisations need to follow certain rules like Kanban, standardisation, uninterrupted flow etc. to be able to implement JIT successfully. Just-In-Time came into being in United States but was subsequently adopted by Taiichi Ohno of Toyota who gave it huge popularity. JIT scheme was enhanced and modified with debut of Autonomation and SMED to be able to turn to the demand of the company. Other planetary companies like Dell, McDonalds ‘ were besides enormously profited by the usage of the Just-In-Time doctrine. JIT has been applied in Indian companies like Lukas TVS, Gontermann-Peipers Ind Ltd, Volkswagen India, Tata Motors and others but there is a range for batch more customization to accommodate the Indian context. JIT has been extensively applied and proven successful for the automotive and other fabrication sectors. There is enormous range to use JIT rules in the other sectors like banking, agribusiness, retail etc.
Merely in clip ( JIT ) is a an attack and set of activities designed to accomplish high degrees of efficiency and affecting minimal stock lists of natural stuff, finished goods and work in procedure. In other words, this doctrine aims at presenting the right merchandise in the needed measure at the right clip at minimal cost. It is a pull production system. This attack aims at continual decrease of waste and discrepancy.
JIT is a direction doctrine and it has been practiced since 1700 ‘s. After the Second World War, Toyota needed to catch entire production of American opposite numbers in order to last. American houses produced about nine times that of Nipponese companies. Ohno, so the president of Toyota studied American system of fabrication and found out that it could non be applied in Toyota as the demand for cars in local markets was low. Consequently he devised a new system of extinguishing “ waste ” from production system. He identified several facets, like transit, overrun, stock list, defects, etc where waste could be avoided. They besides changed the layout of their workss for smoother flow during production. C: UsersAdityaDesktop aiichi-ohno.jpg
Ohno introduced Kanban system. It is basically information about the work to be done. It was fundamentally a rectangular card which had information about the work that was needed to be performed by a worker. All motion throughout the company was controlled by it. Kanban was wholly instituted in the production system of the company ten old ages after it was introduced. This whole procedure involved many hiccoughs and errors, but they learnt from those errors. It took about 10 old ages, but due to Toyota ‘s high and more efficient production, the West started to take notice. The positive consequences were at that place for everyone to see.
1.2 JIT and the universe
In today ‘s universe of globalisation, the competition in any sector is really high. So JIT enterprises aid companies to derive that excess border with regard to its rivals. JIT reappraisals and revamps every operation of the company which helps in the better working of a company. It involves be aftering from executives, workers, stock list etc. In other words it takes into history the operations of assorted sections in a company.
1.3 Just-In-Time Methodology:
1.3.1 Prerequisites of using JIT in a company:
Strategic fabrication program
1.3.2 Goals of JIT
Assorted ends targeted by JIT are as given below:
Help the company to hold an border over its rivals.
It aims at minimising defects happening during production.
Attainment of client satisfaction is one of its premier aims.
It views stock stock list as waste, hence it aims at cut downing this facet in a production system.
This doctrine aims at cut downing material handling during production.
Minimum apparatus clip.
Techniques to minimise lead clip are encephalon stormed.
A JIT applied production system should be less vulnerable to dislocations.
Paperwork involved in the whole procedure should be reduced to minimum.
Produce merchandises when they are needed and rate at which they are needed.
JIT purposes at exposing concealed causes of stock list maintaining. Harmonizing to this doctrine, stock list is considered as waste and it incurs loss alternatively of adding value, as opposed to the impression that of traditional accounting constructs.
1.3.3 Elementss of Just-In-Time Systems
Peoples engagement: Applying JIT in a production system requires combined and committed attempts from each and every individual who is straight or indirectly involved with the company. A successful establishment of JIT is characterized by grade of people engagement.
Plant layout: A layout of a mill is one of the biggest factors impacting the efficiency of JIT, when applied to an industry.
Standardization: There has to be standardization in the constituents to be able to group activities.
Minimal volatility: There has to be minimal volatility in the cost of inputs and end products. Besides the qualities of the inputs are non expected to diminish over clip. If there is cost addition and quality lessening, it might more than compensate for the decrease in outgo on stock list direction.
1.3.4 Principles of JIT:
One piece flow: It is besides known as Single piece flow or uninterrupted flow. In short it aims at traveling the parts from measure to step such that there is no wastage in between. It is best suited for a cellular layout where all necessary machines are located in a U-shaped cell in needed sequence. This system is chiefly used for low mix, high volume fabricating environments.
Machines in order of procedure: Machines should be located in such a manner that it minimizes material handling. Besides the machines should be placed consecutive with regard to the procedures the input undergoes.
Small and cheap equipments: The whole point of JIT is to maximise productiveness and therefore cut down overall cost.
Multi procedure managing workers: This principles aims at uniting assorted procedures so that it minimizes material handling.
Easy traveling operations: Simple techniques can be used like slides so that it decreases on overall cost of the operations.
Definition of standard operations: This rule helps in achieving high quality as it predefines standard manner of executing operations. This consequences in lessening in chance of defect during processing.
Rate at which client buys a merchandise: Inventory is ordered, dispatched and handled as and when it is required. This consequences in minimal stock in the rhythm.
Use of KANBAN system: This technique was invented by Toyota motor company. It aims at commanding all the operations that are performed by usage of signalling cards ( Kanban ) .It helps in speedy presentment and reduces hold and ambiguity in the production line.
Single minute exchange of dies
Statistical procedure control
Use of standard containers
Accomplishable agenda with equal visibleness
Tools where they are needed.
Entire productive care
Following diagrams shows how to travel about implementing JIT in a company
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1.3.6 Misconceptions of JIT:
JIT is a Nipponese technique.
Inventory is a major portion while using this doctrine, but it is non the lone facet in JIT. If JIT in applied as stock list control entirely, opportunities are that it might neglect.
JIT systems are non merely quality control plans. It is more of an operating doctrine.
1.3.7 Advantages of JIT:
Low telling cost for stock list.
Better end product quality.
Decrease in managing cost of stuff.
Efficient infinite use.
Decrease in losingss due to obsolescence of available stuff.
Quality becomes duty of the worker and non merely the quality inspector.
Smoother production flow.
Easy to follow defects.
Higher worker engagement.
Workforce becomes more skilled in the procedure.
Vendor development as he gets long and guaranteed contracts at a steady monetary value.
Quality of stuff sent by seller is improved.
Gross saless cost nest eggs.
1.3.8 Restrictions of JIT:
Implementation JIT will be expensive ab initio.
It takes a batch of clip to give consequences.
Opportunities of losingss in the procedure.
It requires uninterrupted attempt and oversight in the strength can harm the procedure of execution.
Its execution varies for every administration. There is no fixed manner of implementing it.
Its success is besides varied from industry to industry.
Companies trusting on safety stock can hold a job in implementing this methodological analysis.
It adds force per unit area on workers.
Due to standardisation of procedures, workers are non able to happen out of the box of solutions for a job.
JIT execution besides depends on management-workers dealingss. The two parties being at dunces do n’t assist the cause.
JIT involves alteration. It has been found out that usually people are immune to alter.
Employees need to perpetrate to this doctrine in order for it to be successful.
JIT is best suited to merely medium and high volume of production.
1.4 Application of JIT in Industry:
Hospital Industry: With the application of JIT, infirmaries are cut downing the stock list stock and are puting orders at a more regular interval. Nurses were scheduled in lasting displacements to better the nursing quality.
Retail Industry: With the aid of Information Technology, gross revenues information is relayed to the sellers immediately. This helps in better monitoring of the stock degree and reordering at the threshold clip. It helps in cut downing the stock list stock heap up and besides at the same clip enable a speedy response to a alteration in demand.Wal-Mart has shown good net incomes after the execution of JIT.
Information Technology Industry: The IT industry has started following the Just in Time to better the human resource utilisation.The traditional pattern used to be to engage resources in progress in the expectancy of future undertakings. Now the tendency is to engage resources as and when the undertakings are in manus. TCS and Wipro are following JIT to cut down the manpower use.
Manufacturing Industry: The aim is to maximise the fabrication capacity and at the same clip maintain high quality. This is done by keeping limited figure of high quality providers but guaranting the relationship is really dependable between the client and provider. The following measure is to optimise each measure in production line and to do parts with no defects. Besides the production should be in line with the demands of the consumers.
Global Scenario and Trends
2.1 The Toyota Way
Henry Ford applied JIT in Ford to pull off the stock list in the early old ages of twentieth Century. But the basic elements of JIT were developed by Toyota in 1950 ‘s. The Chief Engineer Taiichi Onho of Toyota Manufacturing Company examined accounting premises and realized that another method named JIT was possible. It was chiefly made with an purpose of accomplishing competitory advantage station World War II period in Japan.
The car industry in Japan faced a serious crisis of being after World War II and companies like Toyota were in changeless attempt to benchmark their booming American Counterparts. The productiveness of American opposite numbers was 9 times higher than that of the Nipponese opposite numbers.
So, Taiichi Onho wanted to border a scheme that could assist them accomplish their purpose. But, there were serious challenges on their manner.
American Car makers had a pattern of bring forthing a LOT or BATCH of a theoretical account or constituent before exchanging over to a new theoretical account or constituent. But, this was non suited for Nipponese Car makers where fabrication in little measures was required due to a smaller market.
Contrary to the American Car Industry, low demand in Japan led to monetary value opposition. So, higher net incomes could be realized merely by cut downing the fabrication costs.
So, to get the better of the above 2 challenges, Taiichi could place that the waste that is generated can be reutilized. The classs of waste identified were: –
Inventory or waste associated with maintaining dead stock
Time spent by workers waiting for stuffs to look in the assembly line
Time spend on transit or motion
Workers passing more clip than necessary treating an point
Waste associated with faulty points
So, this is when JIT scheme was identified chiefly to extinguish the wastes and do them responsible for higher production and net incomes.
2.1.3 How Toyota Implemented JIT:
Preliminary Phase: – Toyota JIT fabrication scheme chiefly concentrated on altering mill layout to extinguish transporting points to different machines but instead arrange machines at strategic locations which can do the points move swimmingly from one machine to another. This thought encouraged the debut of KanBan which is besides understood as the information on what to make that can command all motions throughout the mill.
The two types of KanBan in Toyota are:
Production KanBan to detail the points to be produced
Withdrawal KanBan that marked the backdown of the merchandises from the predating stairss.
Execution of JIT: Autonomation
The beginning of KanBan effected precise specifications of point measures without any defect. To guarantee that no faulty constituent enter the assembly line, Toyota introduced Autonomation or automatizing the production system and leting human intercession merely in the affair of higher defects. Harmonizing to this system, it will observe the defect automatically and would non continue in front till the defect is fixed. Its execution made the whole line halt boulder clay the job gets solved. In the first hebdomad, about every hr, the line used to halt, but within 6 months to do the line halt merely a few in month and that excessively without any economic impact on the company.
Execution of JIT: SMED
The major enterprise taken by Toyota as a portion of JIT was re-engineering machines and procedures that could cut down the set up clip required before treating new points. Toyota applied scientists besides identified that the critical jobs and holds were made in altering dyes used for organic structure parts. This job was adjusted by utilizing wrecking bars and twists. This made Toyota launch “ The Single Minute Exchange of Die ” ( SMED ) , which easy substituted measurings for accommodations and commanding the quality of stampings through a written formula. This has drastically reduced the dye altering clip to merely half an hr and facilitated economic batch sizes of even 1 vehicle. Transporting the procedure into storage parts made it store every bit small as 1 portion in each assembly station. The disappearing of portion was the signal to bring forth or order the replacing.
Few Other executions of JIT:
Some of the other alterations were every bit simple as standardised the hole sizes used to hang parts. The figure and types of fasteners were besides reduced to maintain the assembly stairss and tools criterion.
Material flow between two people was besides designed strategically. Here the 2 people worked consecutive in the procedure and the infinite between them was merely a individual square. An empty square instructed the petition by the client for the provider to travel 1 portion forward. A portion in the square served as a signal non to direct any portion. This binary ‘send — do n’t direct ‘ signal besides provided a built-in-test as to whether the provider was working faster or slower than what his immediate client really needed.
Supplier in front
2.1.4 Challenges Faced:
The major challenges included are:
Multi-skilling the work force who could run multiple machines based on such flows.
Redesigning every portion of the vehicle to extinguish tolerance as assembly lines were non given picks of which parts to utilize and every portion had to suit absolutely.
Testing and Training the providers for quality confidence and bringing in Time.
The execution of JIT met with a singular success at Toyota. The sale of work in progress stock list generated immense hard currency, response clip decreased to merely 1 twenty-four hours and client satisfaction increased due to increase in merchandise quality and most of the vehicles built to order, so less opportunities of vehicles non to be sold. This besides created immense equity returns of the company.
Dell has used JIT to help its fabrication procedure to a great extent. Dell has used a different attack in which it has leveraged its providers to accomplish the JIT end. Dell is able to supply their clients ‘ short lead times by doing the providers carry the stock list ant non themselves. By this they can merely piece the constituents so that the merchandises can make the clients rapidly.
Effectss of JIT on Dell ‘s public presentation:
First we need to see why low stock list would hold such a great consequence on Dell ‘s public presentation. The ground behind this is that computing machines depreciate at a really high rate. “ The thirster you keep it, the faster it deteriorates, you can literally see the material putrefaction ” , Kevin Rollins said it in an interview with Fast Company. Computer constituents deprecate anyplace between half to full point a hebdomad. That is the ground cutting stock list is a fiscal jussive mood. The stock list turnover ( COGS/Value of Inventory ) for Dell for 10 old ages.
During 1993 Dell was losing about 10 % per computing machine made due to depreciation, by 2001 it reduced to 1 % .And from there onwards Dell has continued to take down its stock list.
McDonalds uses JIT system in which it does n’t get down to cook ( reheat and assemble ) its orders until the order is being placed. Initially it used to preheat a batch of beefburgers and allow them be under heat lamps for every bit long as possible. And finally the Burgers that were non sold were discarded. A particular order had to be made to acquire a fresh Burger during the old system. McDonalds has now developed new Burger doing engineering which assists in doing Burgers faster. The stock list of the finished merchandise is kept for as short clip as possible and they besides see to it that the client gets the merchandise every bit rapidly as possible.
Benefits for McDonalds:
McDonalds has used JIT in such a manner that helps them achieve improved quality and that to at lower costs.
Improved Quality: They have an advantage when it comes to freshness and gustatory sensation of the merchandise. The other advantages include foremost, McDonalds is that they do n’t fear holding a particular order, as they have an experience of doing Burgers as and when ordered. McDonald ‘s ability to really bring forth faster helps them accomplish client satisfaction. Without this ability, McDonalds telling costs would be really high as they would hold to bare the loss of clients tired of waiting for long continuances. Second, McDonalds can accommodate to demands in a better and a faster manner because of JIT systems. As the readying clip is really low McDonalds does n’t necessitate to worry about their stock lists falling short of the demand.
Lower Costss: Spoilage costs for Burger parts are reasonably high and lead to high retention costs. This is the ground a Burger has a short shelf life and needs to be sold within 15 proceedingss or so. But now because of its ability to diminish the stock list and serve the client faster has lead to important lessening in the costs.
Merely In Time in Indian Scenario:
The life style, values and beliefs that are influenced by traditions in societies have a direct impact on the work civilization along with technological forces. The JIT methodological analysis imposes requisites that are non needfully aligned with this work civilization. Managerial manners and patterns vary from state to state depending on their cultural norms. Therefore, JIT execution and its success depend greatly on work civilization. Taking this thought frontward, the execution of JIT in India would be different from its execution in its western opposite numbers. Hence, utilizing a generic execution scheme might take to issues non faced in other parts of the universe.
The last decennary has witnessed a great trade of growing in the Indian car sector. The Indian Automobile industry is the 7th largest in the universe, the 4th largest exporter in Asia and has produced over 2.6 million units in 2009.
JIT methodological analysis has been widely implemented in the Indian endeavors, particularly in Indian car and fabrication companies.
Some of the Indian companies which are utilizing JIT techniques include Lukas TVS, Gontermann-Peipers Ind Ltd, Volkswagen India, Tata Motors, and IFB etc.
Lucas-TVS are a major participant in Auto Electricals in India today with about 50 old ages experience in design and fabrication. 80 % of vehicles rolled out day-to-day are fitted with Lucas-TVS merchandises. In order to present merchandises at low cost and high quality, Lucas-TVS employed techniques like Total Quality Management ( TQM ) and Quality Assurance methods like Advanced Product Quality Planning, Statistical Process Control Techniques, Effective Tool Management System, and Process Capability Improvements.
In its chase of technological every bit good as methodological excellence, Lucas-TVS has adopted the Cellular Manufacturing System and Just in Time and besides helped providers to follow the same. With the execution of this system, constituents from providers are delivered to it on a pull footing utilizing FIFO construct and assisted by simple ocular controls and utilizing KANBAN system, supplied to the line on an hourly footing.
Following are the JIT related International awards won by the company:
JIT Innovation Award by JIT Management Lab, Tokyo ( 2001 & A ; 2004 )
JIT Grand Prix Award by JIT Management Lab, Tokyo ( 2002, 2005 & A ; 2006 )
Deming Application Prize 2004
3.2 Gontermann-Peipers India Limited:
GPI has created a niche in the Cast Roll and Forge Roll fabrication sector. It is the lone company in India to accomplish TPM Level I. With a position to heighten the operational efficiency of the employees at all degrees extensive developing plans such as Six Sigma, Total Productive Maintenance, Just In Time, Performance Management System have been infused into the HR policies related to preparation in the Company.
GPI, utilizing techniques such as tight control on cost, better realisation and operating efficiency etc has been able to keep an enviable underside line. To accomplish the maximal public presentation efficiency, it has adopted modern direction techniques like Just-In-Time, Total Productive Maintenance, and Activity Based Costing in audience with taking advisers in the mentioned Fieldss.
3.3 Volkswagen India:
Volkswagen India is headquartered in Pune and late launched its $ 700 million fabrication works for Polo in Chakkan. Volkswagen acknowledges India as a of import hub for fabrication and expects India to be in the top five car markets by 2016. The challenge in India is the monetary value sensitiveness and the dependent demand to maintain operational costs low. Using techniques like Just in Time, the company plans to command quality and technological influx by following a planetary sourcing theoretical account in the Indian context.
3.4 Learning and Recommendation:
JIT is good in cut downing operational inefficiencies, leveraging on effectivity and quality procedures in organisations. At the same clip, some of its cardinal elements are hard to implement in the present Indian production scenes. In order to maximise the utility of JIT, Indian endeavors need to modify their operational processs consequently. Before come ining into JIT based fabrication, companies need to develop their employees in order to set up an organisational civilization, set up new processs for supply concatenation direction, survey of operations in order to place possible avenues for standardising, simplifying, automatizing and reengineering of procedures and processs in operations. Failure to run into these requirements will take to jobs with human resources and on the supplier terminal. Although it has been proved that JIT has its benefits in the Indian scenario, it still has ample range of being customized for the state to harvest full dividends.
Future Trend and Opportunity
The challenge faced by the most of the companies today is to acquire the visibleness of the type of work which is coming down the expressway, so that they can maintain their internal resources trained and fix for the work so that they are the experts when they do demo up.
They best manner to pull off and automatize the intellectuals who support the professional services lifecycle is JIT methodological analysis to maintain the accomplishments in balance with the countless undertaking demands and duties. With this we can, at that right minute, conveying on a new employee, travel to a third-party contractor to carry through that demand, or we give ourselves plenty advanced notice to cross-train our bing resources on new engineerings, new merchandises, so that we can work across our portfolio and non merely concentrate on one peculiar country.
JIT techniques have migrated to non-manufacturing environments. It has successfully moved from mill floor to other environments. We can increase the acceptance of JIT techniques within the service sector. This can be done by modifying the JIT nomenclatures to embrace service processes more of course, by stressing the pertinence of JIT techniques to serve operations in operations direction classs, by developing a model for the survey of JIT in services, by using fabrication oriented surveies to services and by developing appropriate theoretical accounts for analysing cost and benefits to serve operations for JIT execution.
Agribusiness Industry: Agribusiness industry needs a new manner of thought. Traditional methods have created a batch of wastes and is non so efficient. Harmonizing to some researches more than 20 % of agricultural merchandises go waste before it reaches the terminal consumer in few states. This offers JIT a good chance to research the possibilities of implementing the JIT constructs in this country. Even if we can cut down this waste by half we will be cut downing the figure of people deceasing due to famishment.
Merely in clip fabrication may non be possible in the field of agribusiness. But the distribution, managing methods etc can be improved with the techniques like JIT and kaizen. By educating people and utilizing simple engineering waste can be reduced dramatically. Efficaciously linking the makers, distributers, jobbers and retail merchants up to the client is really necessary to better the effectivity of the procedure.
Banking Industry: Banks can utilize JIT to acquire rid of tonss of unneeded files, signifiers, supplies, and registering cabinets.
Retail Industry: Besides, JIT can be used in retail industry by supervising the gross revenues pattern hebdomadal and order garments merely before the shops are likely to necessitate them. This manner they can avoid the extra stock list. Besides, to derive cost leading in the market, large participants can minimise costs by developing supply concatenation substructure. Warehouses, distribution centres and transit will overhaul in the signifier of Enterprise Resource Planning ( ERP ) , Just in Time ( JIT ) and IT mechanization.