Just in time (or JIT according to AbbreviationFinder) is known for being a business management philosophy for planning and controlling operations with a focus on maximum quality and waste reduction.
JIT is related to the lean production approach, aiming at a production that flows with more intensity, avoiding the creation of stocks.
In just in time, in order to keep inventories to a minimum, the “pulled production” system is used, where the customer’s request is who initiates the manufacture. Otherwise, more traditional production performs “pushed production”.
Pull and push production systems
The following diagram represents, in a simple way, the differences between the two production systems. The just in time system makes a stage of production a type of “customer” who asks the previous stage for only what is necessary.
It is possible to notice that pushed production accumulates stocks as the product changes, which is minimized in the just in time system.
Meaning of Just in Time
In the Portuguese translation, the expression just in time has the meaning “right on time”, as it indicates that goods or services must be produced only when they are requested.
JIT means to produce at the exact moment necessary, that is, without being ahead of time so that it does not produce stocks or afterwards so that customers do not wait for the finished product.
Origins of Just in Time
Japanese carmaker Toyota is a pioneer in using the just in time approach, which became popular in the second half of the 20th century. Along with the kanban control system, just in time is one of the foundations of the production model that became known as toyotismo.
Currently, the use of just in time is not restricted to the auto industry only. Among the examples of companies from other sectors that adopt the method is the multinational cosmetics company Avon.
How does just in time work ?
According to the just in time philosophy, demand is driven by production. In other words, the company seeks to create a flow that meets the quantity of orders without missing or remaining finished products, semi-finished products and raw materials.
For this to be possible, perfect coordination with suppliers and accurate knowledge of the consumer market are required.
The relationship with suppliers must be close and reliable, as they need to be able not only to meet deadlines, but also to guarantee the quality of the orders they deliver. Any failure in this logistics can stop production.
In addition, just in time requires a perfect definition of the quantities to be produced. If demand is overestimated, stocks will remain. If underestimated, the lack of products could cause sales opportunities to be lost, damaging revenues.
Due to these characteristics, just in time is more suitable for sectors whose consumer demand is stable or where it is possible to reliably predict variations caused by seasonality.
In the just in time production model, quality control is the responsibility of all workers and is carried out at each stage of the process.
For this reason, just in time requires greater qualification from workers, who need to be prepared to identify failures and defects, instead of this responsibility being restricted to a technician or supervisor. Workers must also have greater autonomy to take the necessary measures to correct problems.
That is why, unlike Fordism and Taylorism, which are characterized by specialization and alienation of the workforce, in Toyotism the worker must have a greater awareness of the whole process and more flexibility in his functions.
Advantages and disadvantages of just in time
Among the main advantages of the just in time method is the reduction in inventory costs. This is because, if storage is minimal, a smaller physical space is required for the industrial plant. The leaner infrastructure reduces maintenance costs.
Keeping stocks to a minimum also reduces the risk of loss, deterioration and theft, which means less material waste and greater control. Internal transportation costs are also lower, since production is designed so that the accumulation of semi-finished products is avoided.
On the other hand, as it has no stocks, the company is more vulnerable in case of failures with the supply chain. If any supplier delays a delivery, production may be completely stopped. The same can happen in case of problems with any of the stages of the production process.
Another disadvantage of just in time is its little flexibility to adapt to extraordinary demands. As it does not have stocked products, the company will not be able to immediately serve an order larger than normal.