9.4 Just-In-Time (JIT) Systems

Just-In-Time (JIT) is a management philosophy that emerged in the 1970s, pioneered by Taiichi Ohno and perfected for Toyota’s manufacturing plants in Japan. The primary objective of JIT is to eliminate any activity that does not add value from the customer’s perspective. Activities that do not contribute value are referred to as “waste” within the JIT framework.

The JIT philosophy aims to eliminate these forms of waste by producing only what is needed when it is needed and in the exact quantity required. This approach minimizes inventory levels, reduces lead times, and enhances overall operational efficiency.

By adopting JIT principles, organizations can streamline their processes, reduce waste, and improve responsiveness to customer demand. JIT systems emphasize continuous improvement, flexibility, and the involvement of all employees in identifying and eliminating non-value-added activities.

Successful implementation of JIT requires a cultural shift within the organization, fostering a mindset of continuous improvement, waste elimination, and a relentless pursuit of perfection in meeting customer needs. By embracing the JIT philosophy, companies can achieve significant improvements in quality, productivity, and competitiveness, ultimately driving long-term business success.

JIT manufacturing principles

There are several JIT principles that are applied in a manufacturing setting.

Inventory Reduction to Expose Waste

Excess inventory can mask wasteful practices like poor equipment, weak vendors, bad quality, and long setup times. Gradually reducing inventory exposes these weaknesses, allowing organizations to address them systematically.

As inventory levels decrease, organizations can replace or maintain equipment, improve vendor quality and delivery, streamline setups, implement robust quality practices, and optimize labour/equipment layout.

Inventory reduction exposes waste, creates urgency for improvement, and fosters a continuous improvement mindset. Organizations can streamline processes, enhance efficiency, reduce costs, improve responsiveness, and deliver greater customer value by using it as a tool to identify and eliminate non-value-added activities.

Pull Production System

Traditional manufacturing management approaches emphasize maximizing machine and labour utilization, assuming that keeping workers and machines constantly busy will lead to productivity and efficiency. This approach is known as the “push” system, where raw materials and work-in-process are continuously pushed through the factory in pursuit of high utilization. However, this method often results in high inventory levels, long lead times, overtime costs, increased rework potential, and a competitive rather than cooperative workforce.

In contrast, Just-In-Time (JIT) employs a “pull” system, where workflows to a work centre only when that centre needs more work. If a work centre is already occupied, the upstream work centre should stop production until the downstream centre communicates a need for more material. The emphasis on maintaining high utilization is removed in a JIT environment. Instead, the focus shifts to addressing challenges that affect the factory’s overall effectiveness in meeting its strategic goals, such as setup time reduction, quality improvement, enhanced production techniques, and waste elimination, rather than allowing excess inventory to cover up inefficiencies that reduce competitiveness.

One of the tools used in JIT systems to facilitate the pull system and coordinate activities (such as picking up new raw materials, work-in-process, or production itself) between different workstations is called Kanban. Kanban is a signal or ticket that is passed from one part of the process to another, indicating that they are allowed to start their next activity. This supports the concept of pull production and avoids waste by preventing activities from occurring when they are not needed. Kanban is also a visual signboard used to organize and display what needs to be done, what is in progress, and what is completed, a concept adopted in Agile workflow management systems.

In section 9.2 we learned that Value Stream Mapping is a process used for eliminating waste, and the most costly waste, inventory. Value stream mapping intends to turn a push production system into a pull system. Two key tools used in this process are Kanban, and Supermarket.

By implementing a demand-pull production system and leveraging tools like Kanban, organizations can streamline their operations, reduce waste, and enhance responsiveness to customer demand, ultimately improving overall efficiency and competitiveness.

Watch the following videos to get a better sense of how the Kanban system works:

In section 9.2 we learned that Value Stream Mapping (VSM) is a process used for eliminating waste, and the costliest waste, inventory. Value stream mapping intends to turn a push production system into a pull system. Two key tools used in this process are Kanban, and Supermarket. Watch the following video to gain a better insight into how VSM uses these two tools to transition a traditional push production into a pull production system.

Quick Setups to Reduce Lot Sizes

Traditional production management philosophies promoted the notion that long production runs of the same item were key to driving down unit costs. However, the problem with this approach was that large production runs created excessive quantities of work-in-process (WIP) and finished goods inventory, far exceeding actual demand. Consequently, these excess inventories led to high inventory costs, long lead times, increased potential for rework, and low flexibility in responding to customer needs.

In a Just-In-Time (JIT) environment, reducing setup costs and setup times is crucial for dramatically improving factory competitiveness. In the 1980s, 3M transformed a factory that produced a few adhesive products in long production runs into a facility that manufactured over 500 adhesive products in small production runs. To maintain low unit production costs, 3M focused on optimizing the setups on its coating machines.

Since the cost of chemical waste disposal was a significant factor in the cost of changing over a coating machine to produce another product, 3M took several steps to shorten setup times:

As a result of these efforts, 3M could maintain low unit costs on its coating machines while producing small lots of hundreds of products to meet market demand quickly and efficiently.

By embracing quick setup practices and reducing lot sizes, organizations can minimize excess inventory, shorten lead times, increase flexibility in responding to customer needs, and ultimately enhance their competitiveness in the market. Quick setups enable companies to produce the right products in the right quantities at the right time, aligning with the core principles of the Just-In-Time philosophy.

Flexible Resources

The enemy of Just-In-Time (JIT) is uncertainty. A JIT environment thrives on predictability in customer demand, production processes, supplier performance, and worker availability. However, complete elimination of uncertainty is often unrealistic in most organizational environments.

To defend against unavoidable uncertainty, implementing Flexible Resources that can adapt easily to changing circumstances is crucial. One way to improve flexibility is through the use of general-purpose, movable equipment that can fulfill a wide variety of production requirements. For example, drilling machines with quick-change bits that can be wheeled into position to form new work cells allow the factory to maximize efficiency while producing exactly what is needed to satisfy immediate demand. Another example is Toyota’s use of paint canisters that attach to paint sprayers, enabling any car to be painted any colour without the need to purge hoses when switching from one colour to another.

Multifunctional workers are another way to bring flexibility to the work environment. At Honeywell’s heating and cooling controls plant, workers are trained to operate all the machines on their work line. The flexibility that comes from multifunctional workers changes the nature of how work gets done. Instead of workers being trained on a single machine and working independently, multifunctional workers have a “big picture” view of the production line, understanding all aspects of the line and how to work together to meet quality and schedule goals regardless of the circumstances.

By implementing flexible resources, such as general-purpose equipment and multifunctional workers, organizations can better adapt to changing circumstances and mitigate the impact of uncertainty. This flexibility enables them to respond quickly to fluctuations in demand, production disruptions, or other unforeseen events, ensuring that they can continue to meet customer needs efficiently and effectively within the JIT.

Cellular Flow Layouts

Cellular flow layouts promote JIT goals through unidirectional product flows, high visibility, and fast throughput times. Multifunctional workers are assigned to cells and have responsibility over products from raw materials to finished goods.

This “big picture” view gives workers greater ownership and pride. Their deeper process understanding increases opportunities to contribute ideas for improvement.

Cellular layouts create an environment supporting JIT principles like waste reduction, lead time reduction, and continuous improvement while empowering workers.

Total Quality Management

Total Quality Management (TQM) goes hand in hand with the Just-In-Time (JIT) philosophy. Poor quality is a major source of uncertainty and non-value-added activities that disrupt JIT flow.

TQM promotes continuous improvement, doing things right the first time, designing quality into products/processes, and focusing on prevention – aligning with JIT’s waste elimination goals.

Integrating TQM principles into JIT environments mitigates quality-related disruptions, enabling more efficient JIT implementation. This synergistic approach enhances operational excellence and drives continuous improvement.

Employee Empowerment

Front-line employees play a pivotal role in the successful implementation of Just-In-Time (JIT) practices. They work in partnership with management and each other to continuously pursue excellence. Front-line employees contribute to JIT success in several ways:

1. Problem-solving teams: Employees work together in teams to gather data and build consensus on improving work processes, fostering a collaborative approach to continuous improvement.
2. Quality responsibility: Employees are responsible for understanding the quality measures of their work and what they need to do to meet the needs of internal and external customers, promoting accountability and customer focus.
3. Empowerment to take action: Each employee is empowered to take action to correct problems, enabling swift resolution of issues and minimizing disruptions to the flow of operations.
4. Cross-functional skill sets: Employees possess cross-functional skill sets that allow them to be assigned to areas that need support, helping them adopt a broader (“big picture”) view of the production process.
5. Interconnectedness through demand-pull: Unlike traditional “push” environments where line workers operate independently, JIT employees are connected by the “demand-pull” discipline, where work is produced only when the downstream work centre needs it, promoting interconnectedness and collaboration.
6. Basic maintenance responsibilities: Front-line employees are responsible for the basic maintenance of their machines, fostering a better understanding of equipment conditions and their ability to meet quality and production requirements.
7. Coaching and facilitation: Management works with employees as coaches and facilitators rather than authoritative supervisors, creating an environment that encourages proactive teamwork and continuous improvement.

By empowering front-line employees and fostering a culture of collaboration, accountability, and continuous improvement, organizations can harness the full potential of their workforce in support of JIT principles. This approach not only enhances operational efficiency but also promotes employee engagement and ownership, driving sustained success in a JIT environment.

“Just-In-Time and Lean Systems” from Introduction to Operations Management Copyright © by Hamid Faramarzi and Mary Drane is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.—Modifications: used section Just-In-Time (JIT) Systems, used section JIT manufacturing principles, used section Total Quality Management, some paragraphs rewritten or in some cases removed; added additional explanations; videos removed; videos added.