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Just-in-time manufacturing is a strategy of production that increases process efficiency by cutting out excess inventory that does not provide some form of value to the customer. In production, this generally means producing each part only at the time when it is needed, rather than stockpiling it for later use, as this requires costly storage space and inventory management. The greatest benefit of properly-implemented just-in-time manufacturing is a reduction in wasted resources and an overall increase in efficiency. Disadvantages include the costs associated with constantly transporting rather than storing parts, potential difficulties in procuring product components at the exact time needed, and instability of price and quality of necessary components over time.
The most significant advantages of just-in-time manufacturing involve increased efficiency, inventory reduction, and decreased cost. Producing all components exactly when they are needed, or "just in time," prevents inventory buildup. The space, time, and personnel required for inventory storage and management is largely unnecessary when just-in-time manufacturing is implemented properly, as there should be little or no excess inventory buildup. Furthermore, reducing inventory can reduce the organizational difficulties of inventory management, thereby minimizing the risk that certain necessary components could be misplaced and could slow down the production process.
Many potential disadvantages of just-in-time manufacturing exist, which can, in some cases, lead to an overall decrease in efficiency and cost-effectiveness. Avoiding inventory storage often necessitates frequent transportation of necessary components and finished products to and from the manufacturing space. This frequent transportation has the potential to be both costly and environmentally damaging, particularly if transportation over a significant distance is necessary. When material transportation on a daily basis is necessary, problems such as road blocks, storms, and other unpredictable obstacles can cause substantial delays and interruptions in production. Maintaining at least a small emergency inventory can ensure short-term productivity even in the face of delivery delays.
Price and quality volatility are also important factors affecting the viability and practicality of just-in-time manufacturing. Some products rely on components that can vary significantly in price and quality over time. Purchasing a significant stockpile of certain components of a certain quality level at a certain price can allow for the manufacturing of goods of consistent quality and price for an extended period of time. Just-in-time manufacturing methods, on the other hand, make a company highly susceptible to short-term price and quality changes. As such, end products produced through just-in-time manufacturing may also vary in price and in quality.
I think a "just in time" or lean manufacturing system works well for certain products, but not for others. When I started working at a fast food restaurant as a teen, we would be told to start making hamburgers and not stop until a manager gave the order. There were times when hamburgers would be piling up on trays and the manager watching the serving bin would have to yell "Stop all burgers!" and try to get them wrapped and sold.
Needless to say, there were a lot of hamburgers and other products that couldn't be served because they were too old. It was a very wasteful system, but it worked when we were extremely busy. The company later
switched to a "just in time" system. We would prepare the hamburgers and store them in a heated cabinet, then when a customer ordered one, someone would assemble it and send it out.
There was very little waste under this system, but sometimes the service time was very slow. Someone had to be in place at all times to make the products, even if the hamburger cookers were already gone. If a large group came in and asked for 75 hamburgers to go, a manager would have to recall the grill cooks or produce the hamburgers himself. Orders that size didn't come in all the time, but it was one example of the problems with a "just in time" production system.
I worked in a factory with a lean manufacturing system, very similar to a "just in time" strategy. There were some advantages to working in an environment without warehouses and constant inventories to worry about, but I could see a lot of disadvantages, too.
When I worked in a traditional factory, my job was to assemble electric motors 8 hours a day for five days a week. It didn't really matter if the company actually sold that many motors to customers during that week. I stayed busy making the motors, and someone else stayed busy stacking them on shelves. Hopefully, someone else also stayed busy selling and shipping those motors to customers.
However, when I worked at a
"Just in time" electric motor factory, there were times my supervisor would tell me to find something else to do just to keep busy. Sometimes, he would just call me at home and tell me to stay there. There simply wasn't a need for my kind of electric motors that day. Other weeks, I would be asked to work overtime just to keep up with a large order. "Just in time" manufacturing can lead to a feast or famine situation for the people who actually make the products.
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