“A study on impact of just in time on production”

1. OVERVIEW OF THE PROJECT

1.1 Abstract

In competitive world markets most manufacturing companies have learned that survival rests
on a commitment to continual process and product improvement compete with high quality
of product and low price. In today’s rapidly changing marketplace a company must deliver
low cost together with high quality and reliability of product to ensure retaining an adequate
market share. Just in time production system is among the tools that companies can use to
become competitive.

1.2 Introduction

Just in time is a process that produces necessary units in necessary quantities at the right time.
The purpose of JIT is to produce a unit in such a way that there is only one unit of work in
process and a minimum stock of finished goods in inventories. Therefore, unnecessary
inventories will be eliminated with minimum waste. The principle of Just in Time (JIT) is to
eliminate sources of manufacturing waste by getting right quantity of raw material and
processing the right quantity of products in the right place at the right time.
Today JIT system is well known throughout the world. The reason why the system is so
popular today is a result of its advantages realized by the manufacturing companies. The use
of JIT production system leads to better production quantity, less inventory and shorter
product lead time. The company implementing JIT production system develops closer
relationships with suppliers. It is a system that focuses on waste reduction and continuous
improvement to achieve operational excellence.

1.3) Literature Review

 Singhvi (1992) There is reasonable consensus among researchers that Just in Time
(JIT) is a philosophy of continuous improvement in which non-value-adding activities
are identified and removed in order to reduce cost, improve product quality, improve
performance, improve delivery, add manufacturing flexibility and stimulate
innovation in workplace.

 Cheng, Podolsky (1993) JIT production requires that waste be identified and
eliminated in the following areas: waste from overproduction, waste created by
waiting or idle time, waste of motion, transportation waste, processing waste and
waste from product defects.

 Hay (1997) JIT not only provide companies with great increases in quality of their
manufactured goods, but also help a company to cut response time to market by as
much as 90 percent. The most cited JIT benefit is cost reduction. Other benefits
included: inventory reduction, increased quality and productivity levels, improved
relationship with suppliers, improved customer service, reduced lead time, reduced

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 work in process and raw materials, increased inventory turnover, downtime reduction,
workspace reduction

 Lee (2006) summarized that many small manufacturing firms face size-related
difficulties in implementing JIT. The lack of bargaining power with suppliers and lack
of capital are major hindrances encountered by small firms when implementing JIT.
As a result, they focus on internal changes to improve quality, inventory reduction
and increasing employee participation.

 Kaneko and Nojiri (2008) summarized that for JIT to be successfully implemented
both the manufacturer and supplier should share their information through a reliable
electronic information network. Furthermore, successful implementation of JIT
requires long term relationships between manufacturer and suppliers who have been
selected according to the typical criteria such as quality, low-costs and punctual
delivery.

 Pillai (2010) found that proper inventory management practices results in lower
inventory costs. It was further argued that it is appropriate to encourage SMEs to
adopt better inventory management practices because that would enable them to
achieve lower inventory cost per sales and higher inventory turnover ratios.

1.4) RESEARCH GAP

1.5) OBJECTIVES
 A study on impact of just in time on production

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 2. RESEARCH

2.1 Hypothesis

H1: There is a significant impact of just in time on production

H2: There is no significant impact of just in time on production

2.2 Research Model

Dependent variable Independent variable

Elimination of waste

Inventory Reduction

Just in time

Quality Improvement

Preventing over
production

Labour cost reduction

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2.3 Research Methodology

Type of research: Descriptive research

Data collection: Primary
Data collection tool: Standardised questionnaire
Sampling frame:
Sample size:
Sampling Plan:

2.4 Questionnaire