Question

A motorcycle manufacturer is currently using a conventional production and inventory management system. Recently work-in-process inventory has been piling up at two workstations along the production line. These machines have limited capacity and are bottlenecks. Inventory is backing up all the way back to the stockroom so that you are out of warehouse space and have a hard time unloading trucks from your suppliers. The company is unsure what is causing the issue even without placing much emphasis on sales forecasting they have had significant sales growth in recent years. In the past they have just made production schedule adjustments as needed to meet unexpected demand from arriving customer orders. To eliminate this problem, and possibly somewhat due to the fact that the president and founder’s daughter has just returned to the company after completing her MBA at Edgewood, management is discussing the possibility of implementing just-in-time (JIT) manufacturing.

1. Is that the best solution to this issue for this company at this time, why or why not?

2. What are some fundamental requirements for successful implementation of just-in-time?

3. What is the role of suppliers in successful implementation of JIT and how might you provide incentives for them to work with you? This is of course after fixing their sales forecasting problems.

Answer 1

Just In Time manufacturing is a workflow methodology aimed @ reducing flow times within production systems as well as response times from suppliers to customers. JIT manufacturing helps organizations control variability in their processes allowing them to increase productivity while lowering costs.

1. This is the best solution to the issues for the above company because customers schedule is not in place & the machines have limited capacity of performance. There are lot of tangles between production, customer orders and inventory process. Therefore, JIT will help the company to fix the issues.

2. Here the 3 elements required is: It helps the company to eliminate waste. By focusing on value added processes, JIT is able to achieve high volume production of high quality, low cost products, & meeting precise customer needs. JIT focuses directly, on the production system to make this possible. a. Just In Time manufacturing, b. total quality management, c. respect for people. Some of the other requirements include: top management commitments, culture of an organization, employee's involvement & committment, suppliers coordination & relationship, inventory levels, product variety, etc...

3. Role of suppliers: Production runs are short which means that manufactures can quickly move from one product to another. Companies also spend less money on raw materials because they buy just enough resources to make the ordered products & no more.