Just in Time Case

JUST IN TIME

This paper will introduce and explain the just-in-time concept, a manufacturing production system that was invented by Toyota. It will explain the changes that need to be made to implement the philosophy, the process, and key concepts. Throughout the paper, Toyota Motor Company will be used as the prime example for the implementation of the philosophy especially in the specific elements of JIT Manufacturing, Total Quality management and respect for people.

INTRODUCTION

Just in time is a concept invented by Kiichiro Toyoda but it was Taiichi Ohno ("Ohno") a production engineer at Toyota, who mastered the idea. Just-in-time means to supply to each process what is needed when it is needed and in the quantity needed (Japan Management Association, 1986). Ohno studied the way American supermarkets worked where customers select the types of food they want, place them in their cart, and then pay for them. He thought that the idea of the customer only taking the items needed in the amount needed could work with production. Ohno believed that the total cost of an item is more than what most manufacturers include, such as electricity, labor, and equipment. These are not the true costs.

When a worker produces excess throughput, he creates additional expenses. This excess inventory takes up space in the plant causing the shipping, storage, wage, among other expenses to increase.

Toyota believes that by changing manufacturing methods you would eliminate personnel cost and reduce material cost by only producing what is necessary. This can be done by changing the production flow and by changing the way the plant is arranged. By controlling the throughput alone, managers can control the expenses (Eliyaho M. Goldratt).

ELIMINATE WASTE

One of the concepts that Toyota created was eliminating all waste. This concept instructs to eliminate waste in every aspect of manufacturing, which involves overproducing, time on hand, transportation, the process, unnecessary stock, and producing defective items. Their idea of eliminating waste starts with people. At Toyota work means that they make an advance in the process, and enhance the added value (Japan Management Association, 1986). In order to do this all waste created by personnel is eliminated. Toyota begins by eliminating the wasted motion an employee makes. For example, if there is an idle employee, train that employee on another job that may need an additional worker.

Toyota found that the excessive progression of work creates waste due to overproduction (Japan Management Association, 1986). In order to eliminate this waste the production line must be rearranged, there must be rules so that employees do not overproduce, and machines must be equipped with features to stop it. By doing this, managers will be able to see if there is any wasted time by workers waiting for a machine to process. Managers will also notice which parts are not being delivered in an efficient manner, because a worker is idle waiting for parts. Once managers are able to see the wasted time a worker has, they can put the employee to work on two or more machines at a time if the machine is automated. There is also the wasted time that a worker has in transporting an item from one machine to another. By rearranging the plant and the equipment, this waste can be eliminated. All workers must adhere to the operations and not be allowed any deviation to cause overproduction.

Toyota believes that companies must improve the workers before improving the equipment because if refining the workers proves successful, there is no need to buy expensive equipment. The introduction of expensive automated machines would be a waste of money. This issue was also discussed in The Goal, where the company's new automated equipment became inefficient because the company did not implement a proper production process. Furthermore, If automated equipment is installed, it needs to reduce a full worker, not a percentage. A percentage of a worker means a full worker is still needed (Eliyaho M. Goldratt).

Inventory is considered a waste because it needs storage, additional manpower and can become obsolete. Traditional inventory levels supposed to absorb troubles and smooth fluctuation. However, excessive inventory is considered to be a problem. It is a waste because it hides the actual problems in the plant such as "poor quality, slow delivery, inefficacy, lack of coordination, and demand uncertainty (Reid and Sanders 237)." According to Toyota's concept, by eliminating inventory, the managers will be able to identify problems and work to eliminate them.

LOAD SMOOTHING SYSTEM

There are many peaks and valleys in manufacturing and what Toyota set out to do is to level out the peaks and by doing this they were able to reduce the number of people working. The company was able to achieve this by equalizing the quantity and the type of cars they produced. This is called load smoothing (heijunka) (Japan Management Association, 1986). To create load smoothing, Toyota calculated the cycle time which is determined by the customer. Doing this improved the production process. An example of load smoothing goes like this: you can have one worker go to 16 different machines in five minutes and produce one gear in five minutes or have 16 workers produce one gear every 18 seconds, but you only need one gear every five minutes so you need only one worker. By knowing the cycle time for the production of each component, the load smoothing system can be implemented. The cycle time is calculated as follows:

Cycle time =Daily operating time / required quantify per day (unit)

As the diagraph shows, unit A is assembled in 2 minutes intervals and unit E is assembled in 16 minute intervals. When the separate lines are merged in the second section, the flow is smooth, leaving no peaks or valleys. These lines can be any item in manufacturing, when all the lines are equalized, then every line can have adequate work, and work can also become equalized (Japan Management Association, 1986). The Plan for the productions must also be equalized even if more of the units are required. If the company is required to produce too many units at once then there will be a problem. Additional units needed must be built gradually.

All operations must be standardized in order for load smoothing to work. Bottlenecks are often created because of the change of time. By changing the operation, having tools kept by the machines in the proper order, reduced the time. Workers are allowed to use their own ingenuity