Scribd
Upload
323 views

Just in Time Philosophy

1) Just-in-time (JIT) logistics is the application of JIT management philosophy to the key components of logistics: customer service, order processing, inventory management, and transportation. 2) JIT aims to work with zero inventory and ensure materials are received when needed. It has been shown to increase productivity, quality and efficiency while decreasing costs and waste. 3) For firms to fully realize the benefits of JIT logistics, it must be implemented across inbound logistics, intraplant logistics, and outbound logistics. This allows changes in one area to positively impact other areas.

Uploaded by

Alexander Ovsiy
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
323 views

Just in Time Philosophy

1) Just-in-time (JIT) logistics is the application of JIT management philosophy to the key components of logistics: customer service, order processing, inventory management, and transportation. 2) JIT aims to work with zero inventory and ensure materials are received when needed. It has been shown to increase productivity, quality and efficiency while decreasing costs and waste. 3) For firms to fully realize the benefits of JIT logistics, it must be implemented across inbound logistics, intraplant logistics, and outbound logistics. This allows changes in one area to positively impact other areas.

Uploaded by

Alexander Ovsiy
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 11

JUST-IN-TIME PHILOSOPHY OF LOGISTICS

Performed by: Alexander Ovsiy Group: 013-a

INTRODUCTION
- The globalization is forcing firms to be more careful about customer satisfaction and profit maximization. Therefore, firms must use different tools to develop loyal customers who are less sensitive to the product price increases and help the firms to make profit maximization. Logistics is one of the key tools that builds cost and service advantages to the firms. - On the other hand, Just-in-Time (JIT) management approach, which is effective in the manufacturing sector in particular might be applied to the firms as a chance to achieve cost and service advantages through logistics. When the firms focus on the JIT for business processes but not products, the management principles of the JIT can be applied to logistics.

THE CONCEPT OF JUST-IN-TIME


Just-in-time (JIT) is a materials management system which aims to work with zero inventory and to ensure materials when they are required. JIT has been written about since the early 1970s. If one search would be made on the researches, dissertations, papers and manuscripts that were written about JIT, it is clear that a significant amount of study will be noticed over the past three decades. JIT takes advantages of minimum resources and responses in minimum time to the customers with having minimum waste and using all the factors of production. JIT management approach has been proven effective in the manufacturing sector in increasing productivty, quality and efficency, decreasing costs and waste and improving communication. JIT also started to grow in the service sector around the mid-1990s.

THE CONCEPT OF JUST-IN-TIME (CONTINUED)


Firms are forced to implement a wide variety of innovative managerial tools and philosophies to react to external and internal pressures. Over the past three decades just in time has been one of the most popular business revitalization for the firms. The early development of JIT was initiated by Taiichi Ohno in Toyotas manufacturing plants in an attempt to meet customer demands precisely with minimum delays. A recent research has shown that the successful implementation of JIT philosophy can produce significant benefits for manufacturing firms; such as, improving quality that consistently and continually meets customers requirements; minimizing levels of inventory and improving relationship with suppliers, reducing the labor turn over rate; reducing manufacturing lead times; reducing set-up time, reducing operations and materials handling costs; and maximizing the use of space. Moreover JIT can also ensure the on-time receipt of material from suppliers; improving purchasing function, improving preventive maintenance, increasing worker participation, improving the quality and timing of received material; full utalization of people, equipment, materials and parts; and improving competition while reducing paper work.

JUST-IN-TIME LOGISTICS MANAGEMENT


As a new concept, Just In Time Logistics (JIT-L) can be defined as the application of JIT management philosophy to four main components of the logistics including:

- Customer service
- Order processing - Inventory management - Transportation transfers The role of each component in logistics can be summarized as follows

JIT-L MANAGEMENT (CONTINUED)


There are three logistics activities in a firms logistics supply chain. These three stages of logistics activities are inbound logistics, intraplant logistics and outbound logistics. As mentioned above there are four main components of the logistics and each component takes a place in a different logistics stage. While transportation management is placed in inbound logistics, order processing and inventory management are placed in intraplant logistics and finally customer service is placed in outbound logistics. To reach the full benefits of JIT, it should be implemented at all three logistics activities.

JIT-L MANAGEMENT (CONTINUED)


Changes in inbound logistics with implementation of JIT will of course affect the outbound logistics outcomes such as cost and per cent of on-time delivery. It may also have a direct impact on the inefficiencies associated with suppliers shipping smaller lot-sizes that increases inbound logistics cost. Another benefit could be increasing levels of preventive maintenance that may reduce raw material and workin-process inventory levels, and in addition improved information flows may promote the on-time delivery of parts. The relationship between JIT and inbound logistics outcomes is shown below.

Customer service that is related to final output is a critical element for outbound logistics. Final output can be a physical product (for example, a sofa), a service (for example, travel service) or a combination of both (for example, a fast food restaurant). Customer service is not only about good service levels but also the financial costs incurred from providing quality customer services because minimizing costs is key to survival and prosperity in a competitive marketplace. The definition of JIT with customers could be made like the use of the integrated, problem solving initiatives of a just-in-time philosophy concentrating on improving quality and facilitating timeliness in supply and distribution to external customers. As a part of JIT-L, JIT with customers fundamental objective is very simple: to satisfy the customer by delivering the right goods or services in the right quantities at the right times while minimizing total process cost by eliminating waste of all kinds from the supply chain.

There are three main factors that are associated with JIT with customers: Organizational design, firm performance and control variables as shown in Figure below.

CONCLUSION
JIT logistics is a management approach for the firms that gives them an opportunity to have a competition advantage. However, there are some essential elements for JIT-Ls success. For example, management support is the most important matter to make the implementation efforts sustainable. Employee involvement and cooperation are certainly another important factor for the success in JIT-L. Empowerment of employees improves the procurement leadtime performance. In the organization, creation of quality awareness is also necessary for the full benefits of JIT-L. A number of managerial, operational, and organizational changes in purchasing should also be made. Firms that would like to apply JIT-L will reduce wastes and improve services in their logistics activities.

THANK YOU FOR YOUR ATTENTION

You might also like