Just In Time

Written by Elisabeth Forsythe
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If you've heard the phrase "just in time" floating around your manufacturing plant, it's not just a common idiom anymore. Just in Time, or JIT, is a sophisticated strategy created by the Toyota Motor Corporation of Japan--part of their Toyota Production System. It is a methodology that can increase efficiency and reduce the costs related to inventory.

Back in the early part of the 20th century, Japan was dismissed as a major manufacturing power for one simple reason: the country was small, and land was expensive. That means that companies simply couldn't afford to have large warehouses holding thousands of parts, and their economic lot size (the number of identical products that could be made) was small. The mindset back then was more "just in case"--keep as much inventory on hand just in case demand increased.

But in the 1950s, a new idea was born. Rather than keeping huge inventories, Toyota could receive the parts they needed "just in time," or right when they were needed. In many cases, only one part was kept in stock per assembly station--when it was taken off the shelf, a new part was ordered. Not only did this require far less expensive space for the company, but it forced their suppliers to adopt strict quality controls. Each part had to work perfectly, as there wouldn't be another available.

Improve Customer Satisfaction Just in Time

With JIT in place, Toyota soon found that their response time was reduced to just one day, which improved customer satisfaction. Cars were built to order, which means they weren't producing hundreds of vehicles that might never be sold. In short, JIT was so successful that it was adopted by thousands of different companies, and is widely practiced today.

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