Just-in-Time Inventory Management
Just-in-Time is an inventory management philosophy that aims to reduce inventories by implementing systems and processes to supply a product or service exactly when it is needed, and how it is needed in the production process. The concept of JIT is widely accepted today by many American manufacturing companies, and it is a means of controlling costs through striving to maintain lean inventories—in fact, the concept of JIT was introduced in the early 1980’s to the U.S. as a concept know as “zero inventories”. This inventory control concept involves close relationships with vendors or suppliers, who are able to provide components of the product direct to the work-in-process area, in a “pull” type fashion, whereby the components are delivered immediately before they are required. Since the introduction of the JIT concept, it has evolved to become a management philosophy that requires a corporate-wide commitment to do a process right the first time, and to reduce non-value added activities in the manufacturing process. Because the concept largely centers on this element of focusing on the elimination of waste in the manufacturing process, the JIT concept emphasizes the need for the supplier and the receiver of goods to never have to wait on the other. Ideally, the concept is beneficial to both supplier and manufacturer in this way, because it allows both companies to reduce their Work In Process (WIP) and finished goods inventory, while reducing inefficiencies and bottlenecks in the system—thus cutting costs and improving profitability. The first article pertaining to JIT discusses practical application of JIT methods in the health care industry, titled “Applying Just-In-Time Systems in Health Care”, from the magazine, IIE Solutions. The article describes the opportunities that exist in health care organizations in general, to implement JIT type practices to help improve profitability and work flow. In general, the opportunities that exist for a service
References: Whitson, D. (1997, August). Applying just-in-time systems in health care. IIE Solutions, 29(8), 32. Retrieved March 16, 2008, from Business Source Premier database. Epps, R. (1995, Fall). Just-in-time inventory management: Implementation of a successful program. Review of Business, 17(1), 40. Retrieved March 16, 2008, from Business Source Premier database. Polito, T., & Watson, K. (2006, March). Just-in-Time Under Fire: The Five Major Constraints Upon JIT Practices. Journal of American Academy of Business, Cambridge, 9(1), 8-13. Retrieved March 16, 2008, from Business Source Premier database.