Just in time

Just-in-time manufacturing (JIT) also known as the Toyota Production System is a methodology aimed at reducing flow times within production systems as well as response times from suppliers and to customers.

It originated in Japan in the 1960s and 1970s, but the wise use of the term JIT faded in the 1990s as the new term “lean manufacturing” was established as a more recent name for JIT.

Benefits:

- Lower warehouse costs. Since less space is needed, this reduces the amount of storage an organisation needs to buy or rent.

- Less amount of inventory obsolescence, when companies use the traditional method of inventory they can end up with pallets of unsold items that simply go to waste

- Defect rates are reduced resulting in less waste and greater customer satisfaction.

Risks:

- You become reliant on your suppliers. Suppliers need to be able to supply materials quickly with very limited advance notice and any unexpected even can derive in long term out of stocks.

- Employees are at risk of precarious work as employers seek to easily adjust their workforce in response to supply and demand conditions by increasing the amount of contracting and temporary work.

- By not carrying much of stock, the risk of out of stocks is higher making imperative to have the correct procedures in place to ensure stock can become readily available.

- More and better planning is required to ensure stock is available at all times

If you want to learn more, check out the video below that explains in detail what JIT is and all the elements around this philosophy. 

Couldn´t finish this post without some music. Happy week!