Glossary

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Just In Time Manufacturing

Just In Time Manufacturing

Just-in-time manufacturing, or just-in-time production as it is also known, is a system that involves only placing orders for raw materials when the orders are placed by customers. The philosophy behind this strategy is that rather than storing stock in bulk based on predictions of customer demand, the company will produce when the customer actually places the order. 

This practice was first implemented by Toyota after World War 2 in an attempt to conserve scarce resources. They could not afford to produce something that could potentially not be sold, so they only replenished stock when there was an explicit need for it. 

Some of the processes that are included in a just-in-time system are - elimination of defects, small lot sizes, employing multi-functional workers with skill diversity, streamlining the movement of material, establishing a pull system, and Kanban. 

Advantages of Just-in-time Manufacturing

  • The biggest advantage of employing just-in-time manufacturing is it requires lower storage, warehousing, and investment costs for inventories while maintaining the same level of production. 
  • It leads to higher returns on investments and profitability for the company. 
  • The system helps to reduce various types of waste such as waste from overproduction, inventory waste, time waste, and processing waste. 
  • It will help the company establish a smooth workflow. 
  • It leads to a reduction in work-in-progress. 
  • The just-in-time system places a big emphasis on the quality of output and there is an objective to get things done right the first time.
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Just-in-time manufacturing, or just-in-time production as it is also known, is a system that involves only placing orders for raw materials when the orders are placed by customers. The philosophy behind this strategy is that rather than storing stock in bulk based on predictions of customer demand, the company will produce when the customer actually places the order. 

This practice was first implemented by Toyota after World War 2 in an attempt to conserve scarce resources. They could not afford to produce something that could potentially not be sold, so they only replenished stock when there was an explicit need for it. 

Some of the processes that are included in a just-in-time system are - elimination of defects, small lot sizes, employing multi-functional workers with skill diversity, streamlining the movement of material, establishing a pull system, and Kanban. 

Advantages of Just-in-time Manufacturing

  • The biggest advantage of employing just-in-time manufacturing is it requires lower storage, warehousing, and investment costs for inventories while maintaining the same level of production. 
  • It leads to higher returns on investments and profitability for the company. 
  • The system helps to reduce various types of waste such as waste from overproduction, inventory waste, time waste, and processing waste. 
  • It will help the company establish a smooth workflow. 
  • It leads to a reduction in work-in-progress. 
  • The just-in-time system places a big emphasis on the quality of output and there is an objective to get things done right the first time.
FA CC Banner