Question

Toyota representatives were impressed with the manufacturing system at the U.S. Ford auto plant, but a trip to the grocery store was what actually spurred the change in the Toyota manufacturing process. The resulting just-in-time inventory system satisfied which of the four pressures for organizational change at Toyota?

Answer 1

The four challenges of organizational change addressed by implementation of just in time inventory system were:

1. Maintaining of optimum invetory space - The stock of inventory maintained became directly linked to current production requirement to satisfy immediate market demand resulting in maintaining reduced warehouse space.

2. Order Customization - Since the orders were now being prepared directly based on demand from market, exact components and materials could be sourced in the correct sequence to be available for production and supply, eliminating manufacture of products that would become surplus holding stock.

3. Maximumizing Capital Availability - The JIT inventory management lead to purchase of only necessary components ensuring capital is not booked in maintaining invetory that will not be utilized in foreseeable future.

4. Manpower Management - Use of JIT inventory management ensured that manpower is not held full time in inventory management and can be delegated inventory management based upon requrirement, thereby maintaining flexibility in assigned duties.

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