Just In Time Advantages And Disadvantages

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Definition of Just in time 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. This method requires that producers are able to accurately forecast demand. 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 arrive just as they are needed. History of Just in time JIT is sometimes said to have been invented by Henry Ford because of his one-at-a-time assembly line, circa 1913. This is an incorrect conclusion since…show more content…
They determined that our system was much like the system that Japanese companies were using, but Japanese companies could not afford waste in their systems due to the devastation to their economy caused by World War II. While in America, Ohno learned much about America's culture. One of his discoveries has transformed the world's perspective on manufacturing. Advantages of Just-in-Time Benefits that JIT concept can provide to the company are huge and very diverse. The Main benefits of JIT are reduced set up times in warehouse - the company in this case can focuses on other processes that might need improvement. Improved flows of goods in/through/out warehouse - employees will be able to process goods faster. Employees who possess multi-skills are utilized more efficiently – the company can use workers in situations when they are needed, when there is a shortage of workers and a high demand for a particular product. Better consistency of scheduling and consistency of employee work hours if there is no demand for a product at the time, workers don’t have to be working. This can save the company money by not having to pay workers For a job not completed or could have them focus on other jobs around the Warehouse that would not necessarily be done on a normal day. Increased emphasis on supplier relationships - having a trusting…show more content…
For the company concerned a just in time production leads for example to a clearly higher amount of vulnerability towards crises if there is a disruption in the process of production. As final depots are missing even short-term production problems cannot be solved by stock levels, but already lead to a limitation of the ability of delivery towards the final customer. This makes the importance of a precise planning and controlling of all just in time production processes obvious. Through external material procuration from only on supplier the ordered has to depend totally on him and has to rely on his delivery in time and his reliability. In case of traffic jams or other delivery difficulties this can easily cause a decline or even
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