April 18, 2010

JIT– Just in time

This is a methodology that I am really interested in . Just in Time is a way of managing manufcaturing system that could reduce waste, and lower cost, thus increasing profit. Every component in the manufacturing system arrives just in time for it to be used, so, there is no need for stock holding facilities of any kind.

This methodology plays a big role when companies fall into overproduction for many reasons, companies don't pay too much attention on what is happening between processes, for example Work In Process Queues or an employee being idle.

For the WaveRiders case, we first proposed the application of workcells, this is a work unit which has between 3-12 people at 5-15 workstation in a compact arrangement. For waveriders we can build 4 assebly workcells of 5 people each to work more effectively when building a boat, communication will be very easy as every operator is close to the others, improving quality and coordination. Then, to apply JIT, we need a good flow of information for not incurring in delays. For this flow, I believe the ERP system would be the best fit for the entire communication system, from placing the order to the delivery of the final goods. But for SME's this system is highly coslty so we cant implement this. Instead, we agreed to use KANBAN card system, which is just a basic way to organize activities and cost no money.

ERP and KANBAN seem to be pretty useful when utilizing JIT procedures. But, I would like to have a deeper understanding of these both,  I guess for now I will just have to settle with reading books and  blogs. I would have also liked having some debate in class on how effective is JIT, because it is not only benefits, there are risks such as the bargaining power, one of the Porter's 5 strenghs (barriers with suppliers). SMEs like WaveRiders would probably lose the capacity to obtain good prices from its suppliers as they are only buying "just in time" and not big amounts like other large organizations, therefore, the boats may be offered on a high price.

I hope to apply these methodologies if I ever work in the manufacturing sector, I am sure I could bring a lot of new ideas for the business.


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