Just in time - JIT and Kanban systems

Just in time or JIT as it is known, is a system which adopts the idea of improving output without having a large number of inventory at any stage of the supply chain or production process. It aims to produce and deliver on time and in full all customer orders only after these orders are placed on demand by the customer instead of producing/purchasing parts and finish goods to stock. It is an essential component of a lean or lean manufacturing enterprise.

Inventory is the accumulation of raw materials, work in progress or resources used in an operation. There are costs that need to be taken into account in holding a certain amount of stock/inventory. The inventory costs include the costs for handling, breakage, depreciation, taxes, storage facilities, insurance, and pilferage and obsolescence. All these costs can be reduced and are considered a form of waste, but arise by having high levels of inventories and this is where the JIT system can be implemented to reduce these costs substantially.

Just-in-time (JIT) Manufacturing, is a manufacturing strategy, that aims to achieve a high-volume production using a minimal volume of inventories. The trick in this method is to deliver the inventories of parts to the each workstation exactly when they are needed. It is advisable to combine JIT philosophy with TQM (total quality control) which constantly checks for the causes of defects and eliminate them all together. Just-in-time (JIT) delivery is considered a pull system delivery, as products will only be delivered whenever there is an order or Kanban signal.