Just in Time (JIT) system in the context of a manufacturing and service industry (A Review Paper )

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Satpal Singh1, Jagjit Singh2, Lakshya Aggarwal3

Harsh Dhiman4

1 M.Tech Scholar,  Department of Mechanical Engg. MMU, Sadopur

  1. Research Scholar, Chandigarh University, Gharuan, Mohali
  2. Associate Professor, Mech Engg. MMU, Sadopur

4. Final year student, Mechanical Engg. Govt. Polytechnic, Ambala City

Abstract : Just in time (JIT) is 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. As much a managerial philosophy as an inventory system, JIT encompasses all activities required to make a final product from design engineering onwards to the last manufacturing operation.  JIT systems are fundamental to time based competition and rely on waste reduction, process simplification,  setup time and batch size reduction, parallel (instead of sequential) processing, and shop floor layout redesign.

JIT is observed as a near perfect situation achieved by continuous elimination of the wastes. JIT has been viewed as a strategic weapon for productivity improvement by making all processes streamlined, efficient and effective and quality oriented in an order to enhance the responsiveness of the firm towards customer needs. In India also, the research people are working for implementation and deriving benefits of JIT Technology in  Manufacturing Industry as well as service sector.

 

The objectives of this paper are as listed below

1) Introducing JIT concept for novice.

2) Review of JIT literature.

3) Segregating the different research articles of JIT.

4) Exploring the implementation issues in JIT system in Indian Context

Key Words : JIT, Manufacturing Process, Production, waste, TQM. TPM

1. Introduction: APICS (American Production and Inventory Control Society) defined JIT as “a philosophy of manufacturing based on planned elimination of all waste and on continuous improvement of productivity”. It has also been described as an approach with the objective of producing the right part at the right place at the right time and at minimum possible cost. JIT is a demand pull system. In short, JIT attempts to accurately match demand with supply. Products are steadily flown through the system from the supplier to the final output without slack.

2. History of JIT: JIT is a Japanese manufacturing management method developed in 1970s. It was first adopted by Toyota manufacturing plants by Taiichi Ohno. The main concern at that time was to meet consumer demands. Because of the success of JIT management, Taiichi Ohno was named the Father of JIT. After the first introduction of JIT by Toyota, many companies followed up and around mid-1970s’, it gained extended support and widely used by many companies. One motivated reason for developing JIT and some other better production techniques was that people had a very strong incentive

to develop a good manufacturing technique to rebuild their economy. In Japan, JIT manufacturing is referred as the Toyota Production System. The realization for the new system came after World War II when the Japanese automotive manufactures knew they were far behind the American motor companies.

3. Philosophy of JIT: The first basic principle involved in JIT production approach is the Flexible Workforce. In a JIT system, waste is defined as anything associated with the production process that does not add value to the product. Thus, waste includes quality defects, inventories of all kinds, time spent to move material and time spent in setting up the machines. If the implications of managing the reduction in waste for the categories mentioned above are analyzed, it becomes obvious why JIT is involved in all aspects of the management of production Process. The second principle of JIT involves the management of people.

Push and Pull system [C. Sendil Kumar, 2007] are two types of production systems, which operate equally in opposite sense and have their own merits and demerits.

Push system,  It is a conventional system of production. When a job completes its process in a workstation, then it is pushed to the next workstation where it requires further processing or storing. In this system, the job has a job card and the job card is transferred stage by stage according to its sequence. In this method, due to unpredictable changes in demand or production hinder-ness, the job happens to deviate from its schedule and it causes accumulation of work-in-process inventory. Hence, inventory planners pessimistically fix the safety stock level on the higher side.

Pull system, A pull type production system consists of a sequence of workstations involving value addition in each workstation (WS). In the pull system, from the current workstation (j), each job is withdrawn by its succeeding workstation (j+1). In other words, the job is pulled by the successive workstation instead of being pushed by its preceding workstation. The flow of parts throughout the product line is controlled by Kanban Cards.

JIT is considered to be a “pull” system of manufacturing where production takes place only when there are requirements from downstream operations and specific demands from external customers[11]. JIT has also been defined as a driver that establishes regular, frequent deliveries in small lots from a distributor, and which reduces inventory from a thirty days or sixty days to ten days supply and if possible then reduces to hourly supply.

A simple definition of JIT is to produce and deliver finished goods just in time to be sold, subassemblies just in time to be assembled into finished goods, fabricate parts just in time to go into subassemblies, and purchase parts just in time to be transferred in to fabricated parts.

The production worker is also given the responsibility for the maintenance of his equipment. Frequently, a production worker goes through a check list before starting to operate the equipment similar to that done by a Pilot before Flying an Aircraft. Along with the new job responsibility for workers comes the responsibility for management to provide the training, time, tools and most important, the authority necessary to accomplish the job.

gpa-jit

         Fig 1 Philosophy of JIT

4. Basic Elements of JIT: The elements of JIT, when applied to manufacturing system, ensure that parts or raw materials arrive on the factory floor only at the point of required use or when they are actually needed. Not only does this help with inventory control and costs, but also with inventory storage concerns. Ideally, JIT also ensures that the finished product is only achieved when it is required by the end user or customer. If such JIT methods are properly implemented, the vast savings in inventory can translate to lower costs and benefit the customer as well as the manufacturer. Following are the basic elements of JIT.

  1. Flexible Resources
  2. Cellular Layouts
  3. Kanban System
  4. Small-Lot Production
  5. Quick Setups
  6. Standardization
  7. Jidoka
  8. Total Quality Management
  9. Total Productive Maintenance
  10. Life Time Employment.

5. Types Of Wastes: “Elimination of waste” is the most important parameter of lean manufacturing, followed by “just in time deliveries”[11].Waste elimination is one of the most effective ways to increase profitability in manufacturing and distribution businesses. In order to eliminate waste, it is important to understand exactly what waste is. The eight types of wastes generally found in an Industry are overproduction, waiting time, transportation, inventory, processing, motion and product defect.

6. Objectives Of JIT: The prime goal of JIT is achievement of zero inventories, not just within the confine of a single organization, but ultimately throughout the entire supply chain. Following are the main objective of JIT:

  • Zero Inventory
  • Zero Failures
  • Zero Lead Time
  • Elimination of Wastes
  • Smooth Flow Process
  • Increased Return on Investment (ROI)

7. JIT integration, implementation: Proper planning [C. Sendil Kumar, 2007] is essential for implementation of a JIT manufacturing system and a commitment from top management is a prerequisite. Cost benefit analysis is to be studied  initially with the knowledge of key items such as the cost of conversion to a JIT system and time period of conversion.

8. Advantages Of Just-In-Time System: The advantages of using JIT are numerous. Several advantages mentioned already are those of waste reduction and increased ability to remain competitive. Following are the other advantages of Adopting Just-In-Time Manufacturing Systems:

  • Just-in-time manufacturing keeps stock holding costs to a bare minimum. The release of storage space results in better utilization of space and thereby bears a favorable impact on the rent paid and on any insurance premiums that would otherwise need to be made.
  • Just-in-time manufacturing eliminates waste, as out-of-date or expired products; do not enter into this equation at all.
  • Just-in-time manufacturing encourages the ‘right first time’ concept, so that inspection costs and cost of rework is minimized.
  • High quality products and greater efficiency can be derived from following a just-in-time production system.
  • Close relationships are fostered along the production chain under a just-in-time manufacturing system.

9. Literature Review: There was much interest in American industries in the use of just-in-time (JIT) manufacturing to reduce the work-in-progress (WIP) inventory and to increase the quality of the end product. However, while it promised significant results, it might be difficult to justify that management discard an operating MRP system in favor of a philosophy.

JIT is not just a way to reduce inventory but it is a mean of solving problems that block the building of an excellent manufacturing organization. Its applications and benefits apply not only to the shop floor but also to the marketing, purchasing and accounting aspects. But benefits from this system cannot be achieved overnight. It is a slow process and takes 5 to 10 years to obtain optimum results.

A fundamental microeconomic analysis of a firm which had made an investment into just-in-time (JIT) manufacturing principles was performed. The firm was assumed to possess some monopoly power in the purchasing of its raw materials and had sold its output in a competitive market. The firm’s investment process could take place over one or more time periods and it was assumed that, properly implemented, JIT brings about a unit production cost reduction. The Indian Industries are yet to explore the full potential of JIT. In Indian industries, the JIT is implemented in Volkswagen India, Lukas TVS & Tata industries. A research was also done in Bajaj Steel, Nagpur[9], where it was found that they were following a few norms which were nothing but the implementation of JIT Techniques.

Services are much like manufacturing. Therefore, successful implementation of JIT is vital to manufacturing as well as service industries[10]. Waiting in lines are experienced in our daily schedule. Waiting lines or queues cause inconvenience to customers. Just-In-Time (JIT), the dignified process of waste reduction can also be applied to service industry . However, daily-life problems has remained rather restricted.

The waiting time of pilgrim at Pandharpur, an important pilgrimage center in India was studied[10].  This center attracts a large number of visitors (16million a year) from all over the country irrespective of their caste, religion, belief, social status and professional affiliation. The main objectives of any pilgrim are to have bath in the holy river i.e. Bhima and then darshan by touching the feet of principal deity i.e. Lord Vitthal. By implementation of JIT through web based software, the pilgrims had chosen their date and time according to their availability. Pilgrims registered through web site. After successful registration, they were issued the probable time of darshan etc, It was seen in study that the average waiting time was reduced to 30 minutes from 8 hours.

Another main concept in JIT is supply Chain Management. The sequenced delivery of the materials and products throughout the supply chain of companies is the ultimate realization of JIT principles – zero inventories, zero defects, zero waste. Sequencing problem is a problem that finds a permutation or an ordering of a finite collection of jobs or products that satisfies certain conditions, such as precedence constraints, integrality constraints, monotonic constraints. The four flows should be ensured in supply chain management[12]:

  • Goods flows
  • Transaction flows
  • Money flows
  • nformation flows

10. Conclusion: The JIT concept has found various benefit in Japanes and USA firms. However, in India the full potential is yet to be explored, due to the pending research and management nod to the strategy.  The JIT concept not only encompasses the Just In Time deliveries but it also include a complete implementation package of zero wastage, full management of supply chain. It was also observed that in novelty the JIT Technology can also be applied to service sector in addition to the manufacturing Industry.

11. References:

[1] Li Bo, Li Hui, Chen Ying,(2007)“WIP management and control based on JIT: model and information system development”, IEEE.

[2] Neil R. (2004), “The ups and downs of inventory management”, Material management in Health Care, Vol.13 (2), pp.22-26.

[3] Omar M. (2015), “An optimal policy for a Just in Time integrated manufacturing system for time varying demand process” International Journal of Applied Mathematical Modeling, Vol. 37, pp. 167-169.

[4] Symonds and Bill, (1993)“Justin time inventory management: Application and Recommendations for Naval Hospital Oakland”, Thesis submitted in partial fulfillment of the requirements for the degree of Master of Science in Management at Naval Postgraduate School, California.

[5] Walden J. L., (2000), “Applying Just-In-Time to Army Operations”, Thesis submitted in partial fulfillment of the requirements for the degree of Master of Science in Management at School of Advanced Military Studies, US Army Command and General Staff College.

[6] Telsung M.T. and Patil S.K., (2006),

 “Relationship between work culture and operational               performance in JIT environment”, IEEE International Conference on Management of Innovation and Technology, Vol. 8, No.6, pp. 159-162.

[7] Koji H. and Manabu K. (2015),

 “Covariance-based locally weighted partial least squares for high performance adaptive modeling”, Chemo metrics and Intelligent Laboratory Systems, Vol, 46, pp. 55-66.

[8] Wu M. and Pheng L., (2005), “EOQ,

JIT and fixed cost in the ready mixed concrete industry” International Journal of Advances in Management and Economics Vol. 102, pp.167-180.

[9] Prateek P Kulkarni., (2015), “Just in Time Manufacturing: A conceptual survey & its application in ‘Bajaj Steels Limited, Nagpur” International Journal of research in Advent Technologies, Vol. 3 no 2, feb 2015, E-ISSN 2321-9637.

[10] A.S. Aradhye, (2014), “A case study of Just in Time System in Service Industry”, 12th Global Congress on manufacturing and Management, , Science Direct , pp.2232-2237.

[11] Gurinder Singh and Inderpreet Singh , (2014), “An evaluation of Just in Time implementation on manufacturing performance in Indian Industry” JournaL of Asian Business Studies Vol. 8, no. 3, pp.278-294.

[12] Gyan Bahadur Thapa, (2015), “Supply Chain Logistic in Multi Level Just in Time Production Sequencing Problem” Journal of Institution of Engineering 2015 II(I), pp.91-100.