UNIVERSITI KUALA LUMPUR
MALAYSIA FRANCE INSTITUTE
PRODUCTION AND OPERATIONS MANAGEMENT
FIB 36402 / FIB 36403
M122D1
PRESENTATION REPORT
JUST-IN-TIME PRODUCTION SYSTEM
Prepared By:
Name
Students ID
MUHAMAD SAHIH BIN JUSO
50213211160
JOLYNN SAMANTHA MARTIN
50213211509
ABDUL SYAHIID BIN MOHD RASIDI
50207211669
MUHAMMAD AWWAB BIN JAILANI
50207211278
AHMAD DANIEL BIN AHMAD IZZUDDIN
50213211392
Date: 26 November 2013
Prepared For: Madam Siti Norhafizah
TABLE OF CONTENTS
Description ................................................................................................................................................ 1
Definition .............................................................................................................................................. 1
What is JIT? .......................................................................................................................................... 1
Philosophy of JIT .................................................................................................................................. 2
Applications .............................................................................................................................................. 3
Total Quality Management ................................................................................................................... 4
Production Management ....................................................................................................................... 5
Inventory Management ......................................................................................................................... 6
Supplier Management ........................................................................................................................... 7
Human Resource Management ............................................................................................................. 8
Examples ................................................................................................................................................... 9
Toyota ................................................................................................................................................... 9
McDonalds ......................................................................................................................................... 10
Ramly Burger (Stall) ........................................................................................................................... 11
Dell ...................................................................................................................................................... 12
Others ...................................................................................................................................................... 13
Advantages of Using a JIT System ..................................................................................................... 13
Disadvantages of Using a JIT System ................................................................................................. 13
Comparison of the Traditional and JIT Production System ................................................................ 14
Conversion from Traditional to JIT Production System ..................................................................... 14
The Toyota Approach ......................................................................................................................... 15
JIT Manufacturing Building Blocks ................................................................................................... 15
TABLE OF FIGURES
Figure 1: What is JIT? ............................................................................................................................... 1
Figure 2: Principles in JIT Manufacturing ................................................................................................ 3
Figure 3: Total Quality Management ........................................................................................................ 4
Figure 4: Production Management ............................................................................................................ 5
Figure 5: Inventory Management .............................................................................................................. 6
Figure 6: Boat Analogy ............................................................................................................................. 6
Figure 7: Supplier Management ................................................................................................................ 7
Figure 8: Human Resource Management.................................................................................................. 8
Figure 9: MRP as Part of a Production Plan ............................................................................................. 9
Figure 10: Food Preparation ................................................................................................................... 10
Figure 11: Sophisticated System for Order Tracking with Stock and Supply Management .................. 10
Figure 12: Ramly Burger Composition ................................................................................................... 11
Figure 13: Dell's Online Ordering System .............................................................................................. 12
Figure 14: Toyota Approach ................................................................................................................... 15
Figure 15: Explanation of the JIT Manufacturing Building Blocks ....................................................... 16
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DESCRIPTION
Definition
The Just-In-Time production system (JIT) is a highly coordinated system in which goods are moved
through the system and services are performed just as they are needed only.
What is JIT?
JIT is a production strategy used to improve a businesss return on investment. Its process relies on
signals or kanban between different points to meet the JIT objectives. The JIT production strategy
reduces both in-process inventory and associated carrying costs to meet its production objectives.
Reduce in-process
inventory
How?
Production Strategy
To improve a business'
return on investment
Sometimes referred to as
adopting a Lean Production
System
Preserve value with less
work
Reduce associated carrying
costs
Process
Relies on signals (kanban)
between different points.
JIT objectives met.
Figure 1: What is JIT?
Philosophy of JIT
In JIT, the storage of unused inventory is a waste of resources. The JIT Inventory System works by
exposing hidden inventory costs. However, it is not a simple solution for companies to adopt. Due to
this, the company must follow an array of new methods to manage the consequences of these changes.
This in turn defines how inventory is viewed and how it relates to the management.
Inventory incurs costs or wastes in contrast with traditional accounting. Therefore, JIT is implemented
with an awareness that removing inventory exposes pre-existing manufacturing issues. These issues are
solved by:
Constantly improving those processes to require less inventory.
Having the right material, at the right time, at the right place, and in the exact amount, without the
safety net of inventory.
Encouraging businesses to eliminate inventory that does not compensate for manufacturing process
issues.
APPLICATIONS
There are 5 principles in JIT manufacturing, namely:
1.
2.
3.
4.
5.
Total Quality Management
Production Management
Inventory Management
Supplier Management
Human Resource Management
Total Quality
Management
Human
Resource
Management
Supplier
Management
Production
Management
Inventory
Management
Figure 2: Principles in JIT Manufacturing
Total Quality Management
Figure 3: Total Quality Management
Production Management
Figure 4: Production Management
Inventory Management
Eliminate
safety
stock = 0
inventory
JIT
Inventory
control
system
Inventory
Management
Inventory
hides
problems
in process
Reduce
inventory
= More
space
Figure 5: Inventory Management
Water level = Inventory
Rocks = System Problems
Boat = Company Operations
Figure 6: Boat Analogy
Supplier Management
When needed
Supplier Management
Delivery of 100% defect-free
parts
Where needed
Establish long-term
relationships with few
suppliers
Exact quantity
Eliminate inspection of parts
Communicate problems to
suppliers positively
Work together
Figure 7: Supplier Management
Human Resource Management
Motivation for continuous
improvement
Company-wide
involvement
Problem-solving
High employee
interaction
Absenteeism
Human Resource
Management
Diversified
employees
Eliminate boredom in process
Management support &
empowerment of workforce
Self-inspection of work
Build pride in
workmanship
Figure 8: Human Resource Management
EXAMPLES
Toyota
Pioneers the JIT approach
Only what is needed, when it is needed, and in the amount needed.
Efficient Car production, consist of many parts, follows detailed production plan including
procurement.
Eliminate waste, inconsistencies, and unreasonable requirements.
Improved productivity.
Figure 9: MRP as Part of a Production Plan
McDonalds
Prepare, cook or reheat food when order placed.
Receive scheduled stocks from supplier when inventory is expected to be low.
Study customer preference and order supply accordingly.
Reduce storage cost, lowering material cost and better profit margin.
Figure 10: Food Preparation
Figure 11: Sophisticated System for Order
Tracking with Stock and Supply Management
10
Ramly Burger (Stall)
Limitation of storage space, food preparation area and the absence of a freezer to store burger patty.
Operation running on limited budget.
Restock supply that lasts during the nightly operation. Naive forecasting applies.
Prepare, cook or reheat food when order placed.
Figure 12: Ramly Burger Composition
11
Dell
Dell leverages their suppliers to achieve the JIT goal.
Forcing their suppliers to carry inventory
Demand and receive short lead times on components
Products assembled by Dell and then shipped to the customer.
Provide short lead times to their customers
Figure 13: Dell's Online Ordering System
12
OTHERS
Advantages of Using a JIT System
Greater flexibility
Improved workforce participation
Increased productivity
Shorter lead-times
Simplified scheduling and control
Increased capacity (efficiency)
Better utilisation of personnel
More product variety
Reduced paperwork
Disadvantages of Using a JIT System
Less effective for use in consumer goods production especially in the food industry
Increased transportation costs
Requires a very high level of commitment for continuous system improvement
13
Comparison of the Traditional and JIT Production System
Factor
Traditional
JIT
Inventory
Much, to offset forecast errors, late
deliveries
Minimal necessary to operate
Deliveries
Few, Large
Many, Small
Lot Sizes
Large
Small
Few, long runs
Many, Short Runs
Vendors
Long term relationship
Partners
Workers
Necessary to do the work
Assets
Setup, Runs
Conversion from Traditional to JIT Production System
The Success of JIT Systems in Japan has attracted interest among other traditional manufacturers
around the world. However there are some problems in performing such a conversion.
Management may not be totally committed.
Workers or management may not show cooperative spirit.
Very difficult to change the culture of the organization to one that consist with JIT Philosophy.
Suppliers may resist.
14
The Toyota Approach
Figure 14: Toyota Approach
JIT Manufacturing Building Blocks
There are four basic elements in the JIT manufacturing building blocks:
1. Product Design
2. Process Design
3. Personnel/Organisational Elements
4. Manufacturing Planning and Control
15
16
Figure 15: Explanation of the JIT Manufacturing Building Blocks
17
