Just-In-Time production is a philosophy rather than a clearly defined method to control production. What most managers consider to be JIT, originated at Toyota where it is referred to as the Toyota production system. This system is still evolving as computer integrated manufacturing technology and information systems are integrated with it. The details of Toyota’s system are provided by Monden in his book the Toyota Production System: an integrated approach to just-in-time (1993). From 1973 when the Toyota system began to be widely adopted in Japan (due to the oil shock) until 1983, JIT received a limited amount of attention in the United States. With the publication of Robert Hall’s book Zero Inventories (1983), the concepts and practices of JIT received wide acceptance and adoption by many firms. JIT is defined as a philosophy of waste reduction, not a limited set of practices. Schneiderjans (1993) has examined all of the literature about JIT and has determined that there are eight key principles
1. Seek a produce-to-order production schedule.
2. Seek unitary production.
3. Seek to eliminate waste.
4. Seek to continuous product flow improvement.
5. Seek product quality perfection.
6. Respect people.
7. Seek to eliminate contingencies.
8. Maintain long-term emphasis.
At first glance, most of these principles may seem to oppose JIT`s philosophy of waste elimination. But, they actually do promote waste elimination. By seeking a produce-to-order system, a firm is able to eliminate the waste of finished goods inventory, because the product is sold when completed. By seeking unitary production a firm eliminates the waste of both work-in-process and finished goods inventory. A side effect of this is that a firm using unitary production is able to respond to customer changes much more quickly, since the lead times are shorter. Because there is no buffer of inventory in the system, unitary production reveals problems that might be hidden by the inventory. The third principle is to eliminate waste by using only the minimum amount of equipment, materials, and human resources required. Seeking continuous product flow improvement eliminates idle time. Under this principle all activities that are not required for work are eliminated. By seeking perfect quality, JIT eliminates waste by building 100% perfect products. Respect for people involves workers in the production control, giving them the authority to insist on perfect quality. By eliminating contingencies, managers reduce inventory, which reduces waste. A long-term emphasis is required since JIT`s benefits can take a long period of time to mature.
It is important to understand that JIT is not an inventory reduction system. It is a system that focuses on the elimination of waste in all of its forms. It is sometimes thought of as stockless production, because it uses much less inventory than other systems. But, it still requires inventory. The level of inventory does provide a good measurement of how effectively waste is being eliminated. In this way, inventory is analogous to a thermometer. A thermometer tells the temperature, but it does not create the temperature. The level of inventory in a system tells the observer how effectively waste has been eliminated. The reduction of waste did not eliminate the waste. Inventory is often used in a system to hide problems or to hide waste. Inventory is like the level of water in a stream, which allows a boat to float safely over the rocks and other obstacles. If we remove the rocks the boat can safely float in a lot less water.
It was only possible to operate with fewer inventories after the problems creating the waste in the system were eliminated. Inventory is an effective measure of waste in the system, because the level of inventory in the system is the combined outcome of all the system components. If the quality of the system is poor, then there is additional inventory to compensate for the bad quality, so bad parts will not shut the system down. If the process used in the system is defective, then additional inventory is needed to accommodate the problems such as an extended flow time. The product design greatly influences inventory. The design of a product determines how many components there are in a product and also determines how easy it is to manufacture the product. Maintenance certainly influences the level of inventory, as machines, which are not maintained appropriately, break down more frequently and consequently more inventory is needed to protect against breakdowns. The employees` motivation makes a difference in the level of inventory in a shop as the employees can help solve problems if they are motivated to do so.
Total Productive Maintenance
Total productive maintenance (TPM) has evolved over the past 30 years to ensure equipment reliability at low cost. TPM emphasizes zero breakdowns and zero defects. It supports the philosophy of JIT to eliminate waste. TPM uses all the tools that have evolved over the past 100 years to improve equipment reliability, but it organizes the maintenance process so that it becomes a continuous learning process for everyone involved in it. For example, TPM is a set of techniques to manage breakdown maintenance, preventive maintenance, and predictive maintenance. It applies the scientific method to the management of these programs and to the management of equipment. The goal of TPM is to create an environment in which people and equipment can deliver exactly what the customer requires without waste. TPM actually creates a new system for equipment management. It depends on autonomous teams and on cross-functional teams for its employment.