Just-In-Time Inventory System
Just-in-Time Inventory System Xingyu Wang ACCT-518 Kettering University Just-In-Time Inventory System Due to the changing economic flows that are happening around the globe, management is certainly looking for a way that their business can adopt to it. Customer preferences is not the only determining factor that management consider nowadays, but also the development that caused by climate change and the increasing cost of raw materials. These factors urge managers to look for a better way of managing inventory in a practical way without sacrificing the turn-around period of delivering customer demands. One way of inventory control is the just-in-time inventory system. Overview Just-in-time inventory system was first introduced and tested in Japan by Taiichi Ohno, who is referred as the father of JIT system, during the 1970s. JIT was perfectly applied in Toyotas manufacturing system of delivering products with minimal delays (Cheng and Podolsky, p3). In Toyotas application, JIT focused on three important aspects of the production process namely the people, plants, and system. The system acknowledges the importance of having committed people involved in the production process, having a plant and equipment in working and efficient level, and production time-frame that is well scheduled to meet deadlines. Nowadays, JIT has evolved and became a famous inventory strategy employed by various industries believing in the capacity of the system to strengthen their competitiveness with improved product quality and reduced waste materials. In addition, JIT helps manufacturing business maximize scarce resources by manufacturing the number of products needed during a specific period. In using the just in time inventory system, management believes that there is no need to carry huge amount of items in the inventory, rather, they produced goods that they believe customer will need for the next few months. JITs Advantages and Disadvantages The main objective of the just in time