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JIT & Lean Implementation: Uses & Drawbacks

JIT & Lean Implementation: Uses & Drawbacks
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  • 0:01 Manufacturing
  • 0:49 JIT & Lean
  • 2:21 Drawbacks
  • 4:01 Lesson Summary
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Lesson Transcript
Instructor: Natalie Boyd

Natalie is a teacher and holds an MA in English Education and is in progress on her PhD in psychology.

Manufacturing companies sometimes face challenges storing materials for production, but there are solutions to this issue. In this lesson, we'll look at how lean implementation and just-in-time manufacturing can help.

Manufacturing

Jinn has just been promoted to CEO of a company that makes lotions, soaps, and hair products. He's happy to be in charge but wonders if the company is running as smoothly as it can. For example, he's noticed that they have a warehouse full of raw ingredients and materials that they use to make their products. Do they really need to keep all those materials on hand?

Manufacturing is the process of making a product on a large scale. Jinn's company makes money from making bottles of lotion, so they are a manufacturing business. Like Jinn, many manufacturers worry about whether they are working efficiently or not. To help Jinn and others answer their questions, let's take a look at two related concepts in manufacturing: lean and JIT manufacturing.

JIT and Lean

Jinn wants to know if his warehouse of ingredients and materials is really useful for his company's manufacturing. Is there a better way to keep these things?

Lean manufacturing focuses on eliminating waste in production of products. For example, Jinn's company buys ingredients for their lotions and soaps in bulk and stores them in a warehouse. But if some of those ingredients aren't as potent after being stored for a while, then Jinn's company might need to use more of those ingredients to get the same result. That's wasteful! Instead, Jinn might want to buy less of certain ingredients and use them faster, rather than storing them.

Related to lean manufacturing is a concept called just-in-time manufacturing, or JIT for short. In JIT, companies order materials to arrive just as they are needed. If Jinn knows, for example, that they need a certain amount of an ingredient in order to produce 1,000 bottles of lotion, and if he knows that his company sells 1,000 bottles of lotion every month, then he would order only the amount of the ingredient necessary to make those 1,000 bottles.

Because JIT is about not keeping too many materials on hand, it is one way to implement lean manufacturing. With JIT, Jinn will get rid of the warehouse. Storing ingredients and materials for future use is the antithesis of JIT. Instead, Jinn will order just what he needs, when he needs it. That way, there's never anything extra lying around. He will get the materials 'just in time' for his manufacturing, hence the name of the system.

Drawbacks

Jinn can easily see the benefits of choosing just-in-time manufacturing. His company will save money and space by not having to use a warehouse. But, he wonders if there's a catch. What are the drawbacks to JIT?

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