Just in Time Systems - Essay Example

? Just in Time Systems Just in Time Systems Introduction Just in time (JIT) is a production mechanism that businesses employ with the intention of returning the investments of a business by reducing the inventory that is related to the carrying costs of a business. It mostly relies on signals that are placed in the different systems of processes and they have to tell the system on what next step to undertake. The intention of JIT is to focus on improvement of manufacturing organization so as to stabilize on the investment. Forecast driven systems have a variety of models which require the user to choose from hence placing a problem on the user. As compared to JIT, the forecast driven systems are time consuming in the aspect of developing and also maintaining the programs that are to be used in operating the different models (Womack et al, 2003). JIT offers a quick notice on the stock depletion in an investment as compared to the forecast driven systems which have to evaluate the results of various tests that are run in order to confidently give the results. According to JIT systems, emphasis is on the fact that inventory is a waste and there is therefore need to expose hidden costs so as to effectively manage the inventory and this becomes a challenge for most organizations to adopt (Liker, 2003). This as opposed to the forecast driven systems is only done by one parameter whereas in forecast driven system, several iterations have to be run. It is here that the inventory is viewed as one that incurs costs instead of storing value. The way of working that is adopted by JIT is one that encourages the businesses to eliminate the inventory from their businesses. Pros of JIT and Lean Manufacturing Systems Employees who have multiple skills can be used by the business more effectively. This is attributed to the fact that the organization is able to move workers to where they are needed easily. They should be trained to work in different parts of the business. This helps to manage time effectively as the company is able to reduce the inventory for the changeover time. The tool used in time management is known as single minute exchange of dies (SMED) (Womack et al, 2003). Effective time management will allow for an easy flow of goods from the warehouse to different consumers. A delay in the inventories is reduced and this simplifies the flow of the inventory hence a flexible management of duties. This leaves a smaller chance for the breaking of the inventory as it expires with time. Another advantage is that work is scheduled with reference to the demand for the goods by the consumers. If a product is not on demand at a given time by the consumers, then the business can easily reduce on the production rates. Money is therefore saved together with the resources and workers may not have to be paid for overtime. This helps the organization to emphasize on the supplier relationships since a company that lacks an inventory may not experience a supply system problem which is likely to create a shortage (Womack et al, 2003). Creation of shortages makes the supplier relationships to be vital for a business as the suppliers will be able to come in at regular levels throughout the production day. This is attributed to the fact that production relates to the demand and this helps minimize the storage space needed for the products. Cons of the JIT and Lean Manufacturing Systems JIT usually leaves the suppliers and the consumers to the supply shocks and exposes them to huge changes in supply and demand. The removal of the inventory would show a business where the production flow had been interrupted and exposure of the barriers would force the organization to remove them. This would force any business that was in partnership with the organization to improve its own quality hence resulting to a holdup downstream. The businesses would be forced to employ the production leveling technique in order to work out on the variations and this became a challenge for the consumers especially those that were small scale. This would force the organizations to be involved in low stock levels that will in return affect the demand for the goods (Liker, 2003). A synchronized flow and link created by JIT has an effect on the raw materials since with the present technology, there has to be an order on the delivery process for the raw materials. Since it is a requirement that most of the raw materials be grown naturally, the organizations are forced to synchronize the flow process which becomes a challenge for most suppliers and their consumers. They are therefore forced to undo the supply chain and to only handle the finished goods stocks (Pilkington, 1998). Lean manufacturing systems and JIT can only be implemented in isolation but now the challenge would be how to achieve the isolation as they are involved in huge stocks yet the storage space has been minimized. With reference to the non-value added or wasted activities, the two systems develop a layout for certain facilities that help reduce them time that it takes for the supplies to move to the next level. This is done by ensuring that all the work is in progress especially by placing it next to the manufacturing chain. This makes the inventories to be lowered and a powerful combination is established in order to reduce the costs. Major Challenges of Implementing JIT Systems There is a need to enhance employee training on how to effectively use the systems and involving them fully in order to learn how to operate the new systems. This in return brings about the replacement of the machines with the JIT systems a move that may take employees time to adopt (Pilkington, 1998). A strong interdependence is created by the systems and this makes the supply chain to be weakened and this in turn could be very costly to the whole chain. There are seasonal demand fluctuations which are sometimes caused by disasters. This leaves the retailers with little inventory and the approach to the issue becomes a challenge. Another challenge is the communication breakdown and the company finds it hard to get the right number of supplies needed. Conclusion In today’s competitive environment, organizations and businesses are struggling to employ all possible mechanisms so as to be able to put up with the high competition in the markets. Implementation of the JIT systems will help most organizations to remain competitive and this will result in radical changes both to the organization and the employees’ skills. Cost accounting will be made transparent as it will be affected by JIT systems. References Pilkington, A. (1998). Manufacturing Strategy Regained: Evidence for the Demise of Best-Practice. California Management Review. Vol. 41, (1), pp.31–42. Liker, J. (2003). The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer. New York, NY: McGraw-Hill. Womack, J. P. & Jones, D. T. (2003). Lean Thinking: Banish Waste and Create Wealth in Your Corporation. London: Harper Business. Womack, J. P., Jones, D. T. & Roos, D. (2003). The Machine That Changed the World: The Story of Lean Production. London: Harper Business. Read More