Just-In-Time Working

Just In Time Benefits

Just In Time aims to reduce waste and improve quality, bringing a whole range of benefits to manufacturing businesses of any size, as well as retailers with complex supply chains. These benefits include:

Reduced costs

Just In Time can minimise storage costs. Many businesses find that purchasing only the raw materials or components they need for their current jobs, improves cashflow and minimises the amount of money tied up in stock. Likewise, storing less work-in-progress and fewer finished goods reduces space requirements. For example, using just-in-time working in a circuit board plant, computer manufacturer Hewlett Packard reduced the value of the inventory held from $670,000 to $20,0001. In retail too, getting your suppliers signed up to deliver just in time, can reduce the need for costly storage space – you may no longer need an expensive warehouse.

Higher productivity

It may seem a daunting prospect, but reorganising production to make Just In Time work is excellent discipline for any business. It forces you to consider how every part of the production process works and to look for ways of streamlining working practices. In the above example from Hewlett Packard, as well as reduced stock holdings, the company was able to cut the assembly time by over 95%2.

While in the UK, thanks to a brainstorming session led by the Department for Business, Innovation and Skills’ Manufacturing Advisory Service (MAS), Cheshire-based Advanced Medical Solutions realised long changeover times were holding up their production line. The company rehearsed quicker changeovers and is now more flexible and reactive to customer requirements. To see the full case study, see the Advanced Medical Solutions Case Study Advanced Medical Solutions Case Study .

Competitive advantage

Lean manufacturing helps create a more flexible business that has better communication with customers and suppliers, and can react more quickly to market demands. Many businesses find greater customer loyalty is a welcome by-product of adopting this new way of working. Implementing JIT working will help your business move towards industry best practice and keep up with competitors.

Improved job satisfaction

JIT demands active participation in the production process from employees. It increases their skills, gives them greater responsibility and fosters an interest in the performance of the whole company, rather than just their department or team. You may find this raises morale and helps reduce staff turnover, thereby cutting recruitment costs. Read more about the cultural impact of JIT on the JIT Considerations page.

1 2 Source: 1000ventures.com

Just In Time (JIT) Business Advice: Crown Copyright © 2005-2014
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