Just-In-Time
[JIT]
Is
a production & inventory control system in which materials are purchased
& units are produced only as needed to meet actual customer demand.
First
developed & perfected within the Toyota manufacturing plant by Taiichi
Ohno. Concept based on the pull pull approach viz the flow of
goods is controlled by a pull approach.
Concept
states that an activity should take place only when there is a need for it
Hence
inventory should be brought into the system only when it is required
JIT is supported by concepts such as Kanban, Jidoka, Poka Yoke and
Vendor Managed Inventory.
When Companies use JIT manufacturing & inventory control system,
they purchase materials and produce units only as needed to meet actual
customers demand. In JIT manufacturing system inventories are reduced to the
minimum and in some cases are zero zero JIT approach can be used
in both manufacturing and merchandising companies. It is ideally suited for operations
of manufacturing companies which maintain three class of inventories- raw
materials, work-in-progress, and finished goods.
Several
Indian firms have successfully implemented or are in the process of
implementing JIT.
Toyota
Kirloskar Motors Ltd. has successfully implemented JIT in India through a new
company Trans system Logistics International Ltd. which provides complete
logistics solutions. Maruti Udyog Ltd inventories vary from 2 hours stock for items
like car seats, bumpers & steering systems to a two-month level for nuts
& bolts
For
manufacture of Nano, Tata Motors moved out of Singur in West Bengal and
selected Sanand in Gujarat, where a significant chunk of land has been set
aside for over 35 odd vendors who work very closely to implement JIT.