Just-in-time (JIT) strategy

Submitted To : Dr, Dina Fadaly

By : Jit Team
1 -Ahmed Agamy
2- Marwa Farouk
3- Medhat Saad 4 Mohamed Farouk
5- Mona Galal
6- Samer Samy
7- Samir Hassanein 8- Sherif Shawky

Just-in-time (JIT)
is an inventory strategy that
strives to improve a business's
return on investment by
reducing in-process inventory
and associated carrying costs

 Just In Time ( JIT )

is an optimal material requirement
planning system for a manufacturing
process in which there is little or no
manufacturing material inventory on hand
at the manufacturing site and little or no
incoming inspection.

History

son of Sakichi and founder of

the Toyota automobile business, developed the
concept of Just-in-Time in the 1930s. He
decreed that Toyota operations would contain
no excess inventory and that Toyota would strive
to work in partnership with suppliers to level
production.
Kiichiro Toyoda,

Taiichi Ohno, Toyota's

chief of production in the

post-WWII period. He was THE main developer of
Toyota Production System (TPS).

History ( cont. )
Toyota Production System (TPS) drew
wide attention from the industrial
community because Toyota was a
profitable car company in Japan during
and after the oil embargo in 1970s.

History ( cont. )

Outside Japan, dissemination began in

earnest with the creation of the ToyotaGeneral Motors joint venture-NUMMI
(New United Motor Manufacturing Inc.) in
California in 1984.

History ( cont. )

Widespread recognition of TPS as the model

production system grew rapidly with the
publication in 1990 of The Machine That
Changed the World: The Story of Lean
Production, the result of five years of research
led by the Massachusetts Institute of
Technology.

History ( cont. )

The MIT researchers found that TPS was so

much more effective and efficient than
traditional, mass production that it
represented a completely new paradigm and
coined the term lean production to indicate
this radically different approach to production.

Toyotas philosophy
Selling price Cost = Profit
Customers decide the selling price.
Profit is what remains after subtracting the cost from
it.
The main way to increase profit is to reduce cost.
Consequently, cost reduction through waste
elimination should have the highest priority.
Toyotas paradox: Reducing cost (waste), will reduce
lead time while increasing quality and customer
satisfaction.

Introductory Quotation
Waste is anything other than
the minimum amount of
equipment, materials, parts,
space, and workers time,
which are absolutely essential
to add value to the product.
Shoichiro Toyoda
President, Toyota
1995 Corel Corp.

Sources of Waste

Waste form overproduction

Waste of waiting time
Transportation waste
Inventory waste
Processing waste
Waste of motion
Waste from product defects

Minimizing Waste:
JIT Production
Produce...

...what is needed...
...when its needed...
...NOTHING MORE!

Just-In-Time Production
WHAT IT IS
Management philosophy
Pull system though the plant

WHAT IT REQUIRES

Employee participation
Industrial engineering/basics
Continuing improvement
Total quality control
Small lot sizes

WHAT IT DOES
Attacks waste
Exposes problems and bottlenecks
Achieves streamlined production

WHAT IT ASSUMES
Stable environment

What Does Just-in-Time Do?

Attacks waste
Anything not adding value to the product
From the customers perspective

Exposes problems and bottlenecks

caused by variability
Deviation from optimum

Achieves streamlined production

By reducing inventory

 The primary objective of JIT is getting a

balanced system, with a regular and quick
flow of products throughout a supply chain.
This is accomplished by:
Eliminating disruptions
Implementing a flexible system
Decreasing set-up times
Decrasing stock levels to a minimum
Eliminating waste and rejects

Benefits of JIT Systems

Reduced inventory levels

High quality
Flexibility
Reduced lead times
Increased productivity
Increased equipment utilization
Reduced scrap and rework
Reduced space requirements
Pressure for good vendor relationships
Reduced need for indirect labor

Operations Strategy

Nigel Slack and Michael Lewis 2003

Operations Strategy
Strategic
Reconciliation
Operations
Resources

OPERATIONS
STRATEGY

Market
Requirements

Operations strategy reconciles the

requirements of the market with the
capabilities of operations resources

Nigel Slack and Michael Lewis 2003

The Market Perspective

on Operations Strategy
Customer
Needs

Performance
Objectives

Market
Positioning

Competitors
Actions

Required
performance

Nigel Slack and Michael Lewis 2003

Understanding
markets

The Operations Resource Perspective

on Operations Strategy
Tangible and
Intangible
Resources

Operations
Capabilities

Operations
Strategy
Decision Areas

Operations
Processes
Understanding
resources and
processes

Nigel Slack and Michael Lewis 2003

Strategic
decisions

Strategic Reconciliation
Tangible and
Intangible
Resources
Operations
Capabilities

Customer
Needs

Operations
Strategy
Decision Areas

Performance
Objectives

Competitors
Actions

Operations
Processes
Understanding
resources and
processes

Market
Positioning

Strategic
decisions

Required
performance

Understanding
markets

Operations strategy is the strategic reconciliation

of market requirements with operations resources
Nigel Slack and Michael Lewis 2003

Strategic Reconciliation
Operations

Resources

Strategic Reconciliation

Market
Segmentation

Operations
Resources

Operations
Competences

Operations
Strategy
Decisions

Performance
Objectives

Strategic
Decisions

Capacity
Supply networks
Process technology
Development and
organization
Nigel Slack and Michael Lewis 2003

Market
Positioning
Competitor
Activity

Operations
Processes
Understanding
Resources and
Processes

Market Requirements

Required
Performance

Quality
Speed
Dependability
Flexibility
Cost

Understanding
Markets

Variability Occurs Because

Employees, machines, and suppliers
produce units that do not conform to
standards, are late, or are not the proper
quantity
Engineering drawings or specifications are
inaccurate
Production personnel try to produce before
drawings or specifications are complete
Customer demands are unknown

Continuous Flow
Producing and moving one item at a time (or a
small and consistent batch of items) through
a series of processing steps as continuously
as possible, with each step making just what
is requested by the next step.
It is also called the one-piece flow, single-

piece flow, and make one, move one.

Continuous Flow Production

Traditional Flow

Production Process (stream

of water)

Suppliers

Flow with JIT

Customers

Inventory (stagnant
ponds)

Material
(water in
stream)

Suppliers

Customers

Push versus Pull

Push system: material is pushed into
downstream workstations regardless of
whether resources are available
Pull system: material is pulled to a
workstation just as it is needed

JIT Purchasing--Requirements
Reduced lot sizes
Frequent and reliable delivery schedules
Reduced and highly reliable lead times

Consistently high quality levels for

purchased materials

JIT Purchasing--Suppliers
Fewer, nearby suppliers
Repeat business
Support suppliers competitiveness

Clusters of remote suppliers

Limit competitive bidding to new parts
Resist vertical integration
Encourage suppliers to implement JIT purchasing

JIT Purchasing--Quantities
Little or no permissible overage or
underage of receipts
Suppliers encouraged to package in
exact quantities
Suppliers encouraged to reduce their
production lot sizes (or store
unreleased material)

JIT Purchasing--Quality
Minimal product specifications
imposed on supplier
Help suppliers to meet quality
requirements
Close relationships between buyers'
and suppliers' quality assurance people
Suppliers encouraged to use process
control charts instead of lot sampling
inspection

JIT Requirements:
Design Flow Process
Link operations
Balance workstation capacities
Re-layout for flow
Emphasize preventive maintenance

Reduce lot sizes

Reduce setup/changeover time

JIT Requirements: Total Quality Control

Worker responsibility
Measure SQC

Enforce compliance
Fail-safe methods
Automatic inspection

JIT Requirements: Stabilize Schedule

Level schedule
Underutilize capacity
Establish freeze windows

Attributes of Lean Producers - they

use JIT to eliminate inventory
build systems to help employees product a perfect part every
time
reduce space requirements
develop close relationships with suppliers
educate suppliers
eliminate all but value-added activities
develop the workforce
make jobs more challenging
reduce the number of job classes and build worker flexibility
apply Total Productive Maintenance (TPM)

Thank You