Just-in-Time (JIT)
Dr. Maansi Gupta, PhD
Just-in-Time (JIT)
The Just-in-Time (JIT) system was introduced in Toyota as part of the Toyota
Production System (TPS) in the 1950s.
Its full-scale implementation and global recognition came in the 1970s.
Focus of JIT
Producing what is needed
When it is needed
What quantity is needed
History of JIT
Around 1945, after the second world war, Japanese economy was shattered
by lack of resources, low productivity and poor demand.
The policy makers in Japan realized that a major revolution was essential in
manufacturing industry, to make Japan competitive.
In the automobile industry the demand was too small, with multiple models. It
was realized that they could not get the benefits of large-scale production like
Western countries.
Therefore, their manufacturing strategy had to focus on producing many
models in small numbers.
History of JIT
To meet these challenges, a new type of system was developed known as Just-
in-Time (JIT).
The aim was to maintain smooth production flow with a varied product mix,
and low inventories.
The JIT concepts have deep roots in Japanese culture. The Japanese society is
conservative, with severe restrictions on space and natural resources.
The approach taken was “waste reduction” in all aspects, thereby reducing
costs.
Waste Reduction Program
The waste reduction program was planned on two main pillars:
Just-in-time
Automation
Just-in-Time
Developed from “supermarket” concept in US where the customer gets
what is needed, at the time needed. In the supermarket, stock is
replenished, either through a storeroom or by direct delivery from suppliers.
Just-in-Time
In a production system, material is fed to a workstation from the preceding
(upstream) workstation.
The objective was to ensure that each workstation gets the required
material from the preceding workstation precisely when needed, or just in
time.
Therefore, just-in-time requires a very smooth operating system. If material is
not available when a workstation requires them, the whole system will get
disrupted.
Automation
Automation (with a human touch)
The concept of automation is to avoid disruption. With appropriate automation
of machines, an operator could be responsible for operating multiple machines.
This was necessary to facilitate productivity improvement.
The machines were foolproofed so that they could automatically detect
problems and operator intervention would take place in an automated process
only at the right time. That is what is meant by automation with human touch.
This was found to be necessary to avoid interruption in JIT environment.
Systems and Procedures to Support JIT
To implement waste reduction program, variety of new systems and
procedures were introduced to support JIT concepts and automation. These
included:
Kanban system Vendor relations
Setup reduction Quality control
Worker training and Worker participation in
education improvement process
Many of these were successful and some were not. Today, the Kanban system
of Toyota is among the best for reducing inventory levels.
Seven Zeroes
To achieve the targets of workstations acquiring material just-in-time, a just about
perfect production system environment was required. This was achieved by pushing
and stretching to idealistic situations.
The idealistic situations defined the goals of JIT in terms of aiming for seven zeros, to
achieve near zero inventories.
The seven zeros are as follows:
1. Zero breakdown: Since there is no cushion of excess WIP or inventory in the
system, any breakdown will stop the entire line. Therefore, an ideal JIT situation
can not accept any machine failure or operator unavailability.
Seven Zeroes
2. Zero defect: In a JIT environment, since parts are received at workstations only
when needed, it is essential that parts are of good quality. There is no excess
inventory in the system, therefore a defective part will cause delay. It is
important that every part must be made right the first time. Therefore,
acceptable level is “zero defect”. Further, since it is not possible to wait for
inspection, the quality must be built in at the source itself.
3. Zero (excess) lot size: In JIT system, the objective is to replenish stock, taken by
next downstream workstation, as it is taken. Hence, the goal is to reduce batch
sizes. This goal is often stated as “lot size of one”.
Seven Zeroes
4. Zero setup time: Sometimes it can take hours to change a setup to produce a
different part. Therefore, it makes sense that large batches be produced in
between setups. The goal is to minimize the time between different setups,
thereby reducing lot sizes and enhancing flexibility.
5. Zero lead time: In perfect JIT material flow situation, a downstream workstation
requests parts when required and they are provided immediately by the
upstream workstation. The lot size of one reduces the effective lead time to
produce a part. But actual processing time for part is also important. Therefore,
zero lead time is important to achieve target of zero inventories.
Seven Zeroes
6. Zero handling: Since the number of parts that are made are exactly as per
requirements, then material should not be handled more than necessary. No
extra movement to stores is acceptable. The ideal is to feed material from one
workstation to the next.
7. Zero surging: In JIT environment, when parts are produced only when needed,
then production in plant will be smooth only when production plan is smooth
and does not have too many fluctuations, both in numbers and model mix,
since there is no inventory in the system to take care of these fluctuations.
Therefore, a level production plan and uniform product mix is important for
achieving JIT. Essentially, it means no spikes across days, no spikes within a day.
Seven Zeroes
Are so many zeros achievable or feasible? Obviously, no. They are like zero
inventory.
Zero lead time with nil inventory is like instant production, which is not feasible.
The real purpose of these objectives is to make use of them to inspire operating
people to an environment of “continuous improvement”.
Whatever your production system is, there is always room for “continuous
improvement”.
Environment as Control
The Japanese production management systems focus holistically on the
production environment rather than on individual aspects like scheduling,
quality, setup time, and suppliers.
A typical example of focusing on individual aspects is taking the setup time as
fixed, and then optimizing the lot size, by various mathematical algorithms.
In contrast, the Japanese focused on reducing the setup time itself, aiming for
zero.
Environment as Control
Japanese took a holistic approach, and systems view of entire manufacturing
operations.
Suitable policies were developed to cut across traditional functions, and
wherever required develop suitable interface between them.
There is a continuous attention to detail, and often the Japanese approach is
to ask “why” five times to go into depth and fully understand the root cause.
Overall, the Japanese focus is always on root cause elimination and not so
much on the apparent symptoms.
Implementation of JIT
JIT is a conceptual framework carefully developed by Japanese companies for
restructuring the entire manufacturing operations.
We will discuss the implementation of JIT under the following sub-heads:
Production smoothening
Capacity buffers
Setup reduction
Cross training and plant layout
Total Quality Management
Production Smoothening
As discussed under zero surging, JIT requires a relatively smooth production plan.
Therefore, if either the product mix or the volume changes significantly, it will be
difficult for the workstation to replenish the stocks just in time.
Manufacturing plants make use of Master Production Schedule (MPS), that specifies
what products to make in what time schedule.
It is important that MPS is reasonably balanced over time.
MPS generally specifies what products to make over a weekly/ monthly schedule.
Toyota and many other manufacturers make use of a final assembly schedule (FAS)
for managing day to day schedule.
Production Smoothening
Making a FAS from MPS consists of :
Smoothening aggregate production requirements
Sequence final assembly
If MPS requires 10000 units in a month, considering 25 working days in a month, this
means 400 units a day on a single shift basis or 200 units per shift on a 2-shift basis.
Once aggregate requirements of MPS are converted to daily requirements, next
step is to define product specific requirements to a production sequence. This is
done by breaking down daily requirements according to product proportion from
MPS.
Production Smoothening
In previous example of production of 10,000 units in a month to be produced, if 50%
(5000 units) comprise of product type A, 25% (2500 units) of product type B, and 25%
(2500 units) of product type C, then it means that daily production of 400 units
should include:
0.50 x 400 = 200 units of A
0.25 x 400 = 100 units of B
0.25 x 400 = 100 units of C
Production Smoothening
These products should be sequenced on the line such that proportions (50-25-25)
are maintained as uniformly as possible. Therefore, sequence would be:
A-B-A-C-A-B-A-C-A-B-A-C-A-B-A-C-A-B-A-C- OR
A-A-B-C-A-A-B-C-A-A-B-C-A-A-B-C-A-A-B-C-
The line as well as the rest of the plant should be flexible enough to support this type
of production mix. This is possible only when setup between products are very short
or almost zero.
The objective in JIT is to maintain level as much as possible rather than making large
batches between setups.
Capacity Buffers
A major problem occurs with JIT when there are unexpected disruptions,
breakdowns, order cancellations or changes in product configurations.
Since JIT does not permit any WIP cushions, capacity buffer is kept so that
subsequent downstream stations do not suffer.
A commonly used capacity buffer is scheduling the plant for less than 24-hour
utilization.
This helps in providing extra capacity if line is falling short.
If production is ahead, the workers may be redeployed, additional improvement
activities may be carried out or preventive maintenance may be done.
Capacity Buffers
Another way is by two shifting. In this method factory work is planned on 2 shift basis
8-4-8-4 basis.
In this way two 8-hour shifts are separated by 4-hour gap, which provides for some
cushions for contingency planning.
Another option is capacity buffer by overtime.
In MRP system, capacity buffer is provided by WIP at various workstations or by
overtime.
Setup Reduction
A work sequence suggested earlier, A-B-A-C-A-B-A-C-A-B-A-C-A-B-A-C-A-B-A-C-
may not be feasible if setup times from one product to other are significant.
Internal setup operations are those operations performed when the machine is
stopped.
External setup operations are those operations performed when the machine is
running.
It is the internal setup which is disruptive to the production process and deserves
more attention so that it can be reduced to as low as possible.
Setup Reduction
Steps to reduce setup time:
Separate the internal setup from the external setup.
Separate as much as possible of the internal setup to external setup.
Try to abolish the setup itself.
Cross Training and Plant Layout
To achieve JIT objectives and for productivity improvement, it was observed
that the system is better served by a multifunctional workforce who can move
wherever required to maintain the workflow.
This approach increased worker productivity and gave more flexibility.
A multifunctional workforce served following purposes: kept multiple skills
active, reduced boredom and fatigue, fostered a holistic approach about the
overall task, and increased the potential for new ideas for the job in hand,
where multiple people will be looking at a problem.
Cross Training and Plant Layout
They also considered a revised layout of machines, so that
machines could be laid out close to each other in a sequential
manner to perform successive operations, so that job flows from
one to another workstation.
A linear layout helps in easy workflow but does not permit a
convenient worker movement.
Therefore, a ‘U’ shaped layout was considered.
This can also be called a ‘U’ shaped cell or line or module.
Total Quality Management
Although basic quality management systems were developed in America, but
Japanese adapted them and took them to new heights.
JIT requires a very high level of quality to be successful, since there is no excess WIP
in the system or any other cushions.
In brief, the Japanese Total Quality Management systems comprise of the following
seven principles:
1. Process control: Workers were educated to use quality control tools including
process control charts and be responsible for the quality of products made by
them.
Total Quality Management
2. Easy to see quality: Japanese made extensive use of visual displays of quality
measures.
3. Insistence on compliance: Workers were trained to demand quality standards at
every level in the system. The approach was quality first and production second.
4. Line stop: Japanese practiced “Quality first” to such an extent that each
workstation was given a red button to stop the line to correct a quality problem.
5. Correcting one’s own errors: Workers or a group who produced a defective part
were encouraged to correct it and set up methods such that similar defects do
not occur again. This gave workers full responsibility for quality.
Total Quality Management
6. The 100 percent check: Objective was to inspect every part, not just random
sampling. So automatic continuous inspection techniques were developed.
However, in situations, where, this was not feasible, the first and last part in the
same setup was inspected.
7. Continuous Improvement: The ideal target was always zero. So, the Japanese
workers were always encouraged to practice further improvements in what
ever task they were performing.
Kanban System
Kanban system has been developed and practiced by Toyota to perfection.
It is a two-card system.
When a workstation becomes available for a new task, the operator takes a next
production card from a box.
This card tells him that a particular part is required at a downstream workstation. He
looks to the inbound stock point for the material required to make that part. If the
material is there, the operator removes the move card attached to the material
and places it in another box.
If the material is not there, the operator moves to the next production card.
Kanban System
Whenever the operator finds both production card and necessary material, he
processes the part, attaches the production card and places it in the outbound
stock point.
Periodically a mover will check the box containing move cards and will pick up the
cards. He will get the material indicated by the cards from their respective
outbound stock points, replace their production cards with the move cards and
move them to appropriate inbound stock points. The removed production cards will
be deposited in in the boxes of the workstations from where they came, as a signal
to replenish the inventory in the outbound stock points.
Kanban System
The two-card system followed by Toyota is valid when the workstations are located
some distance away. It is not possible to move parts instantaneously from one
station to next.
Therefore, in-process inventory must be in two places: at outbound stock points,
where workstation has just finished processing and at inbound stock points where it
has been moved for next processing. The move cards serve as signals to movers that
material needs to be transferred.
Kanban System
If the workstations are located close by, the WIP can effectively be handed from
one process to the next. In such a situation, two inventory points are not required
and two-card system can be replaced with one-card system.
In this system also, the operator still requires a production card and material to start
with. However, in this case instead of removing the move card from the incoming
bin, he removes the production card from the upstream operation and sends it
back to upstream station.
Push vs Pull System
In a push system, production and inventory decisions are made based on
forecasted demand. For example, in MRP, the decisions regarding scheduling
of procurement and production are made based on forecasted demand and
then inventory is pushed through the system.
In a pull system, production and inventory decisions are driven by actual
customer demand. Nothing is made or moved until a customer order triggers
the process. For example, in Kanban system, the movement of material from
an upstream workstation is driven by demand from a downstream workstation.
Difference between MRP and JIT
MRP Paradigm JIT Paradigm
• Takes some inefficiency for • Kaizen: continuous
granted and optimizes improvement
resources based on that
• Reductionist approach • Holistic or systems
approach
Examples of Differences between MRP
and JIT
MRP JIT
Setup cost Setup time and cost is given, optimize Reduce the setup cost or setup time.
and time resources based on that. For example, reduce time for die
change from 3 hours to 3 mins.
Delivery Fixed due dates and elaborate Negotiate with suppliers and make
schedules delivery schedules. arrangements for frequent deliveries,
of small batches.
Quality Some quality defects will be present. Zero defects policy. Raise frequent
Optimize resources based on given awareness of quality issues both in-
level of quality. house and with vendors and together
find ways to overcome these issues.
Design Over-the-wall Team effort, concurrent engineering
JIT and Lean Manufacturing
Lean manufacturing is called 'lean' because it produces products using far lesser
input resources than traditional 'job shop' and 'mass production' methods.
Like JIT, the focus of lean manufacturing is on cost reduction through waste
reduction. It involves removal of all unnecessary costs or 'waste‘ in the system. This
advantage of waste elimination is translated into customer satisfaction in terms of
improved performance, better quality, lower cost, and faster delivery.
The difference between JIT and lean manufacturing is that the lean manufacturing
encompasses the whole business rather than just manufacturing. It includes product
development, production, supply chain, distribution and customer service.
Key Learnings from JIT System
Just-in-time is not a strategy, or management tool, but a combination of attitudes,
philosophies, priorities and methodologies, that have been collectively called as JIT.
Toyota has successfully demonstrated to the world, its advantages in practice.
Some of the inherent advantages are summed up below:
1. Operation details matter strategically: Small details can give big advantage.
Focus of JIT is on manufacturing cost reduction and on seemingly unimportant
issue of manufacturing process waste reduction.
Key Learnings from JIT System
2. The production environment itself is a control: Strategies and plans that aim for
reducing inventory, reduce setup change times, leveling production schedules
can have great effect on efficiency of production process.
3. Controlling WIP is important: Most significant benefits of JIT are through low WIP,
and consequential benefits of low WIP levels. There is faster throughput, short
cycle times, low change over times, high quality levels, etc.
4. Flexibility offers strategic advantage: Flexibility offers a steady production rate
and a mix of different type of production. Flexibility is built in the system as part
of design by capacity buffers, multi-skilled workforce, cellular plant layouts, etc.
Key Learnings from JIT System
5. Quality comes first is important: Most significant part of quality first is that quality
is built in the system at the time of manufacture, and not by inspection. All
quality techniques are practiced during manufacture of components and
products. Quality takes a precedence over production numbers.
6. Continuous Improvement is essential for growth: Practice of JIT requires that
manufacturing process and systems are continuously challenged for
improvements. Standards and practices of yesterday, considered as best, are
not adequate for tomorrow. Therefore, continuous improvement is essential for
survival.
