CHAPTER 5: JUST IN TIME

PURCHASING OF MODERN
BUSINESS ENVIRONMENT ON
MANAGEMENT ACCOUNTING
LECTURERS NAME: MISS SITI AISYAH BASRI
GROUP: MAC1104B
NO NAMES

MATRIC CARD

NURUL AMIRAH BINTI RUKHADI

2014870864

AINAA NAZURAH BINTI ARBAIN

2014273162

NUR SYAHIDAH BINTI SULONG

2014417968

IZZAH YUHAINAA BINTI YUNUS

2014222172

NIK FATINI AUNI BINTI AZLI

2014801478

DEFINITION
JIT Production : - A production system driven

by demand for finished goods where each

component on a production line is produced
ONLY when needed for the next stage.
JIT Purchasing : - A purchasing system where
material purchase is contracted in such a way
that receipt & usage of material, to maximum
extent possible, COINCIDE.

MODERN BUSINESS VS TRADITIONAL

BUSINESS
Modern Business

Traditional Business

Highly competitive environment Relatively simple

technology
Use of robotics

Mostly manual

Initiate new industries

Little innovation

production

Change
in
focus
towards Concerned
primarily
customer, quality and value
internal matters
Flexible production system

with

Labour and material costs were

easily identifiable

PRINCIPLES

TRADITION
MANUFACTURING

JIT MANUFACTURING

QUALITY

Inspect goods only at critical

points

Workers inspect the goods in

the process. goal is to achieve
0 defects.

PLANNING &
CONTROLLING

Focus on planning. adopts push

system.

Focus is on controlling. adopts

pull system

CAPACITY

Larger batch sizes. highly

utilized

Small batch sizes. moderate

utilized

INVENTORIES

Large wip buffer inventories

Inventory is still maintain small

wip buffers

WORK FORCE

Competitive attitude between

workers & manager

Workers have cooperative

attitude & broadly skill to tackle
the problem

LAYOUT

Job shop manufacturing

Cellular manufacturing

TRANSFORMATION

Longer lead times

Shorter lead times

MAINTENANCE

Corrective measure, repairing a

machine when it break down

Preventive measure, machine

are continuously checked at
regular interval of time

SUPPLIERS

Multiple sourcing & suppliers

are treated as adversaries

Single sourcing & suppliers

become part of the team.