Question

JIT has also influenced small companies by pushing them to change their planning and systems. In other words, though JIT was originally designed for large manufacturing firms it is applicable to both large and small manufacturing firms. Discuss whether you agree or disagree with the above statement and why. What are the main difficulties of JIT implementation in small firms?

Answer 1

A just in time approach is a collection of ideas that streamline a company’s production process activities to such an extent that wastage of all kinds viz., of time, material, and labour is systematically driven out of the process. JIT has a decisive, positive impact on product costs.JIT system aims at:
• Meeting customer demand in a timely manner
• Providing high quality products and
• Providing products at the lowest possible total cost.

The five main features of JIT production system:
• Organise production in manufacturing cells, a grouping of all the different types of equipment used to make a given product. Materials move from one machine to another where various operations are performed in sequence. Material – handling cost are reduced.
• Hire and retain workers who are multi-skilled so that they are capable of performing a variety of operations, including repairs and maintenance tasks. Thus, labour idle time gets reduced.
• Apply TQM to eliminate defects. As, there are tight link stages in the production line, and minimum inventories at each stage, defect arising in one stage can hamper the other stages. JIT creates urgency for eliminating defects as quickly as possible.
• Place emphasis on reducing set-up time which makes production in smaller batches economical and reducing inventory levels. Thus company can respond to customer demand faster.

However the JIT system may not be suitable for Small firms as the essential pre-requisites of a JIT system are

• Low variety of goods
• Vendor reliability
• Good communication
• Demand stability
• TQM
• Defect free materials
• Preventive maintenance

And the small firms may not be able to afford it.