...are the Just In Time (JIT) and the Lean manufacturing models. Both of these manufacturing models have been used for decades in the manufacturing sector since they have been invented in the 1960s. Currently in the global economy most manufacturing is happening in both South and East Asia, while most of the services for the global economy are happening in the Western Europe and North America (Wild, 2002). There are several factors why it is like this in the world company. For manufacturing industry there are manufacturing models that are being used and for the services there are services models that are being used. The basic concept in manufacturing sector to improve the efficiency of the production is by increasing the production output or decreasing the workforce required (Drury, 2008). Whereas the basic concept in the service sector to improve the efficiency of the services is by adding a new worker that improves the value of the service of the company. That is why when new workers want the join any company they may have to do an interview for that company and explain why the company should chose that worker than any of the others and prove he can improve the company’s service. The JIT manufacturing model has been used a lot in manufacturing and has given Japan manufacturing massive success over the last few decades especially for Toyota (Drury, 2008). The JIT approach model involves continuous commitment to the pursuit of excellence in all phases of the manufacturing system...
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...Abstract Just in Time (JIT) inventory management has its benefits and setbacks which leads to the question on its eligibility to be adopted in organizations. It has some of the benefits of being cost effective and ensuring quality production. However, it faces unpredictability in the supply chain and meeting demand, both setbacks realized in adopting it. The magnitude of the benefits and setbacks can vary depending on the industry. The current study provides details on the advantages and disadvantages of employing the policy in the manufacturing industry with implementation examples specific to the car manufacturing industry. With the policy being pioneered by Toyota, and later used by Ford, the evidence that the two organizations have benefited substantially from the policy are obvious. They have had increased profits, customer satisfaction and the quality of their products. All while reducing costs associated with the storage of excess inventories, defective production, and waste. Strategies maximizing the use of a just in time policy and avoiding some of the disadvantages will also be discussed. Just in Time Just in time production first surfaced just after World War II in Japan’s Toyota Company. Modeled after Henry Ford’s continuous flow manufacturing, it focused on eliminating waste in the postwar Japanese market (Rona, 2013). Today just in time still emphasizes the reduction of waste, but also production and resource efficiency. These efficiencies are gained through...
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... “JUST IN TIME” Just-in-time (or JIT) manufacturing is a way of managing manufacturing systems that could reduce waste, and lower cost, thus increasing profit. Just-in-time can also be defined as a philosophy of manufacturing based on planned elimination of all waste and on continuous improvement of productivity. It has been described as an approach with the objective of producing the right part in the right place at the right time, hence the phrase Just-in-time. JIT should improve profits and return on investment by reducing inventory levels, reducing variability, improving product quality, reducing production and delivery lead times, and reducing other costs, such as those associated with machine setup and equipment breakdown. Just-in-time applies to repetitive manufacturing processes in which the same products and components are produced over and over again. The general idea is to establish flow processes by linking work centers so that there is an even, balanced flow of materials throughout the entire production process, similar to that of an assembly line. JIT can be traced back to the late 1700’s. Eli Whitney contributed his concept of interchangeable parts to the idea of JIT manufacturing in 1799. The basic elements of JIT were developed by a Toyota motor company in Japan in the 1950’s. In order to begin use of JIT manufacturing in Japan, they first researched American production methods focusing on Ford’s practices. In Japan Just-in-time manufacturing is referred...
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...------------------------------------------------- Quality Focus Paper Just-in-Time Production and Lean Manufacturing Keller Graduate School of Management Spring Semester, May 2010 Session GM588: Managing Quality (online) Instructor: Robert Lee 5 June 2010 Table of Contents I. Introduction 3 What is it? 3 Background 5 History 7 II. Literature Review 9 Significance in Practice 9 JIT and Lean Thought Processes 10 JIT & Lean Thinking – General Principles 10 Advantages/Benefits of JIT/lean 10 Major Advantages/Benefits of JIT 11 Major Advantages/Benefits of Lean Productions 11 Relevance of JIT/lean in Today’s Businesses 11 Mistakes of Implementation 13 Additional Challenges 13 III. Demonstrations and Applications in the Business World 16 Survival Strategy for Business 16 List of Companies that use JIT/lean production techniques 18 Best Practices & Successful Implementation 18 IV. Conclusion and Reflection 20 References 22 Introduction * What is it? Just-in-Time (JIT) production is a set of principles applied to manufacturing and inventory to control the purchase of materials to produce units on a need-basis. JIT is set on the philosophy that controlling raw materials purchased for production to bring them into the manufacturing process as they are needed leads to cost savings and production efficiencies. JIT focuses on realizing that holding little or no inventory has economic and quality values for the organization. Manufactures receive...
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...Just in time strategy Introduction the objectives of this presentation is to introduce the concept of “JIT” and its efficiency in cost-effective operation in both product and service manufacturing. This strategy is widely used nowadays due to its ontime delivering of the right product/service at the time of its demand. This is a system that is highly used in many industries. In this essay we will see the example of the most common industry using JIT manufacturing, the automobile industries and explain why this method is so effective and widely accepted. Definition/ General Description Just-in-time method is based on the total elimination of waste, producing goods and services only when needed withought having to store inventory or have the customer waiting for the product/service. In other words, it is based on producing only the necessary parts in the necessary quantities at the right time by matching the production rates with the market demands at that time. Due to the fact that the materials arrive just in time for manufacturing, there is no need for storing inventory as mentioned previously. By these we can see that it operates at low cost and in reality generates profits. The “JIT” method has a positive effect on productivity and work performance and it’s overall cost-effective. The most common industry using JIT manufacturing is the automobile industries. I “JIT” and Toyota Production Systems History The idea of JIT manufacturing goes back to the Toyota...
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...delay is longer than delivery delay, and also to ease the effect of imperfections in the manufacturing process that lower production efficiencies if production capacity stands idle for lack of materials. The reasons for keeping stock All these stock reasons can apply to any owner or product stage. Buffer stock is held in individual workstations against the possibility that the upstream workstation may be a little delayed in providing the next item for processing. Whilst some processes carry very large buffer stocks, Toyota moved to one (or a few items) and has now moved to eliminate this stock type. Safety stock is held against process or machine failure in the hope/belief that the failure can be repaired before the stock runs out. This type of stock can be eliminated by programmes like Total Productive Maintenance Overproduction is held because the forecast and the actual sales did not match. Making to order and JIT eliminates this stock type. Lot delay stock is held because a part of the process is designed to work on a batch basis whilst only processing items individually. Therefore each item of the lot must wait for the whole lot to be processed before moving to the next workstation. This can be eliminated by single piece working or a lot size of one. Demand fluctuation stock is held where production capacity is unable to flex with demand. Therefore a stock is built in times of lower utilisation to be supplied to customers when demand exceeds production capacity...
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...Just-in-time (JIT) is a management philosophy that aimed to eliminate manufacturing wastes by producing only the right amount and combination of parts at the right place at the right time. It is also that JIT enforces ‘Continuous Improvement’ by continual reduction of non-value-added inventory stocks to lower and then further lower levels. It is based on the fact that the wastes result from any activity that adds cost without adding value to the product, such as transferring inventories from one place to another or even the act of storing them. JIT was developed as a way to meet customer demands with minimum delays. Thus, at times, JIT is used to reduce manufacturing waste, but mainly for the manufacture of goods that orders are met exactly when they need the products. JIT manufacturing is a powerful and proven system of producing products efficiently while keeping costs low. Some of the most successful companies in the world have used this philosophy to improve their manufacturing processes and better meet customer demand. Just in Time Manufacturing (JIT) refers to a manufacturing system in which products are not built until the product is ordered and paid for. Some companies that have successfully implemented JIT include Toyota, Dell and Harley Davidson. Dell Dell has used JIT principles to create manufacturing process a success. Dell’s approach to JIT is different in that they utilize their suppliers to achieve the JIT goal. They are also unique in that Dell is able...
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...TABLE OF CONTENTS 1.0 INTRODUCTION 2 1.1 The importance of Just In Time (JIT) 2 1.2 The Objectives of the study 3 1.3 The Research Methodology 3 2.0 LITERATURE REVIEW 5 2.1 The Definition of JIT 5 2.2 The Purposes of Just In Time 10 2.3 The Importance Elements In JIT Implementation 12 2.4 Difficulties and Issues Associated with Implementation of JIT Components. 23 2.5 Main Issues and Difficulties of Managerial Nature in JIT 30 2.6 The Benefits of JIT 34 2.7 The Limitation of JIT 36 2.8 The Relationship Model and Supporting Activities of JIT, TQM AND TPM 41 2.9 The Relationship between JIT Production and Manufacturing Strategy and their Impact on JIT Performance 43 3.0 FINDINGS 50 4.0 CONCLUSION AND RECOMMENDATION 59 REFERENCES 61 APPENDIXES 64 INTRODUCTION The Importance of Just In Time (JIT) Nowadays, companies used Just In Time (JIT) systems control work flow by bringing in materials and sending out goods on demand which is ideally, just enough to provide what consumers want. JIT also is a production and inventory control system in which materials are purchased and units are produced only as needed to meet actual customer demand. In just in time manufacturing system inventories are reduced to the minimum and in some cases they are zero. Companies typically hold inventory in three locations which are raw materials, work-in-process inventory of partially worked materials or sub-assemblies for workstations to complete...
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...company’s financial position at any given time and make informed decisions based on the information provided. I chose to take a conservative approach at production capacity out of the gate, beginning the simulation with a capacity of 25 units per day, as the likelihood of sales exceeding that mark would have been highly unlikely and understanding that turning a profit is a tall order in the first quarter of any business. Initial budgeting was focused on directing the company’s limited capital toward the opening of the first two locations, New York and Tokyo. As the simulation moved into the 3rd and 4th quarters, it became imperative to budget for factors outside the realm of manufacturing. Each quarter, the ability to direct advertising, marketing research and human resource dollars was a requirement for success. The need to balance adequate staffing needs in relation to production and product demand required the use of multiple research and demand projection budgets. From the onset, my goal was to turn an overall profit during the first 4 quarters of operation. The pro-forma statements give simple to understand metrics of the financial position of Elite Solutions. Each quarter, I was able to ascertain the financial position, specifically regarding net operating cash flow and the cash balance at the end of each period to determine the relative success of each quarters’ activities. B2 My initial approach to the manufacturing process was based primarily on projections...
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...strong and long lasting value chain all the links within the chain must be prepared to overpass all existing problems. The principle of Just-in-time is to eliminate sources of manufacturing waste by getting right quantity of raw materials and producing the right quantity of products in the right place at the right time. JIT - History and Philosophy JIT is a Japanese management philosophy which has been applied in practice since the early 1970s in many Japanese manufacturing organizations. It was first developed and perfected within the Toyota manufacturing plants. Problems before JIT system were that companies can not properly calculate their material flows. Also, there were problems with warehouses because there were situations that in one moment warehouses are full with stocks, and in other they are almost empty. Because of these problems it was really difficult for engineers and managers to deal with logistics. Moreover, the company would have no goods still in process at the end of the day, and all goods completed during the day would have been shipped immediately to customers. "just-in-time" means that raw materials are received just in time to go into production, manufacturing parts are completed just in time to be assembled into products, and products are completed just in time to be shipped to customers. In Just in time manufacturing, the traditional emphasize of keeping everyone busy is abandoned in favor of producing only what customers actually want. Benefits of...
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...improve in their market segment. Question One Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions): 1. Cost a) Cost of Production: Cost of production of the two types of anchors they manufacture are as follows: A) Freshwater Mushroom/Bell Anchors: $8.00 per pound B) Saltwater Snag Hook Anchors: $11.00 per pound As Albatross Anchors price per unit are on scale with their competitors, concerns need to be address as to the issues of profit margin being under 35% on some of their products. Outdated technologies as well as inefficient manufacturing practices need to be revised and implemented to make the manufacturing process more efficient. b) Economies of Scale in material purchasing: Due to the size and scope of the plant space, as well limited area for storage of raw materials, Albatross Anchors will be hard pressed to meet capacity utilization. According to The Economist, “Economies of scale are factors that cause the average cost of producing something to fall as the volume of its output increases”, (The Economist, 2008). As...
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...company manufactures two types of anchors in different sizes. The types are the mushroom/bell anchor and the snap hook anchor. Albatross Anchor has many manufacturing problems which are the cause of the company not doing as well as it should be. The company build old, worn and does not meet government guidelines. Albatross can be a company of the future with the application of much need upgrades and expansions. Question One Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions): 1. Cost and Production: Albatross Anchor‘s competitiveness in relations to cost below their competitors. They are 35% lower than their competitors. The cause of this is all the operation inefficiencies. They need to correct all of their problems in order to get in line with the competitors. The cost to manufacture is the same as the competitors $8.00 per/lb. for mushroom/bell anchors and $11.00 per /lb. for snag hook anchors. But, with the high price of shipping raw materials in finished goods not shipping out, and the cost of raw material, these are just some of the problems causing the company to lose money. The cost of the manufacturing process is hurting Albatross. The down time in between set up of the different anchors is a downfall of the company. They are paying workers to be there to wait for work to begin. The cost of...
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...White Paper Lean Manufacturing Lean Manufacturing Table of Contents Executive Summary.......................................................................................................................................................................................2 Introduction .......................................................................................................................................................................................................4 Lean Manufacturing—So What? .................................................................................................................................................4 Objectives .................................................................................................................................................................................................6 The Manufacturing Challenge .................................................................................................................................................................7 Globalization and Competitive Pressure ................................................................................................................................7 Mass Production to Mass Customization ...............................................................................................................................7 Shortening Product Life Cycles........................................................................
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...concept of just in time is to have exactly the right amount of inventory on hand at any given time, no more or no less. Just in time is a production and inventory and planning control system which takes a disciplined approach to achieving and maintaining continuous improvement in performance. It is centered on the elimination of waste from raw materials stage throughout the shipping stage. Just in time is defined as” the production of the minimum number of different units in the smallest possible quantities at the latest possible time, thereby eliminating the need to stockpile inventory. This manufacturing technique attempts to achieve a standard of excellence within the company by promoting respect for people in the workplace along with eliminating sources of waste by ordering only the needed amount of product at the times which they are needed. Just in time requires efficiency and stimulates improvement in quality and productivity throughout a company as whole. Taiichi Ohno is considered to be the father of the just-in-time philosophy. He developed this technique during the 1970s while he was working at a Toyota manufacturing plant. Even before he was allowed to implement this new philosophy he could see the benefits of constructing a lean system. Ohno often inquired about why it was necessary to stockpile large amounts of inventory in warehouses as opposed to receiving smaller more frequent deliveries from suppliers. He understood that in order to implement just in time...
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...QUESTION ONE The success of an organization depends not just in production and operations, but the interrelationship between this function and other functions of the organization such marketing, finance and human resources. As a company grows, no one person can do everything. There are different areas of activity that take different styles or knowledge. Production and operations will not be complete without successful mobilization and application of financial resources towards the production activity. At the same time, organizations must also ensure that the output of production is conveyed successfully to the target customer through effective marketing. Finance ties all departments together with monetary measurements that tell whether the organization is making money. They also regulate the acquisition of funds to keep the business going on, and investing money received wisely. Sales and Marketing are usually lumped together into a group that focuses on maintaining and attracting customers to the company's products and services. Other functional areas that might interface with production and operations to make the organization successful include the following sections: Research and Development, Transportation, Information Services, Security, Medical, Government Relations and Training. QUESTION TWO: a) Operations strategy Operations strategy is the development of a long-term plan for using the major resources of the firm for a high degree of compatibility between...
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