Just In Time Production System definition – Just In Time or often abbreviated as JIT is a production system that is used to meet customer needs at the right time in accordance with the amount desired by the customer.
The purpose of the Just In Time (JIT) production system is to avoid the occurrence of excess quantity / amount in production (overproduction), excess inventory (excess inventory), and also wastefulness in waiting times (waiting).
The term “Just In Time” If translated directly into English is Timely, so the Just In Time Production System or JIT in English is often referred to as the Timely Production System.
On-time here means that all supplies of raw materials that will be processed into finished goods must arrive on time with the right amount too.
All finished goods must also be ready to be produced according to the amount needed by the customer at the right time too. Thus the Stock Level or supply level of raw materials, supporting materials, components, semi-finished materials (WIP or Work In Progress), and also finished goods will be maintained at the level or the minimum amount.
Please to also read Understanding Inventory Management and Costs on Inventory.
In carrying out the Just In Time production system or JIT production system, it is necessary to carefully plan production schedules, starting from the purchase schedule of production materials, the schedule for receiving production materials, the production schedule, the product readiness schedule to the delivery schedule for finished goods.
Please to also read what is scheduling in the production process.
In general, modern manufacturing companies are currently using a variety of sophisticated software in planning production schedules which also includes issuing purchase orders and controlling inventory quantities.
The Production Software can also exchange information from suppliers (vendors) to customers (Customers) through Electronic Data Interchange (EDI) to ensure the accuracy of the most detailed data (details).
The accuracy and timeliness of delivery of production materials are needed in this JIT Production System. For example, in a cellphone manufacturing company, the company must be able to receive the correct number and model of LCD displays needed for one day of production, the LCD Display supplier is expected to be able to ship and arrive at the production warehouse in a very short time limit. Such a system of requesting for Production materials is usually called a “Pull System” or “Pull System”.
Advantages of Just In Time Production System (JIT)
Many advantages can be enjoyed in implementing the JIT production system, including the following:
- Low inventory level or stock level thus saving storage space and related costs such as rental fees and insurance costs.
- Production materials are only obtained when needed so that only requires low working capital.
- With a low level of supply, the possibility of waste due to outdated expired and damaged or obsolete products will be even lower.
- Avoid the buildup of unsold products due to sudden changes in demand.
- Requires an emphasis on the quality of production materials supplied by the Supplier so that it can reduce inspection and rework times.
Weaknesses of the Just In Time (JIT) production system
Although there are many advantages to be had, this Just In Time Production System still has weaknesses, namely:
- The Just In Time Production System has no tolerance for mistakes or “Zero Tolerance for mistakes” so it will be very difficult to make repairs / rework on production materials or finished products that have defects. This is because the level of inventory of production materials and finished products is very minimum.
- Very high dependence on Suppliers both in quality and on-time delivery which is generally outside the scope of the manufacturing company concerned. Late delivery by one supplier will result in delays in all planned production schedules.
- Transaction costs will be relatively high due to the high frequency of transactions.
- The manufacturing company concerned will find it difficult to meet the sudden high demand because in reality there are no more finished products.
Many Manufacturing Companies that implement the Just In Time production system enjoy significant benefits such as Toyota and several Japanese manufacturing companies that have implemented it since the 1950s. But the success of the Just In Time Production System is highly dependent on the commitment of all company employees from the lowest furniture to the highest level.