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

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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

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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

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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

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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.

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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

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Figure 15: Explanation of the JIT Manufacturing Building Blocks

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