Job lot manufacturing and other intermittent manufacturing concepts

The production is done for stock or according to a customer’s order under the intermittent manufacturing system. When the manufacturing is carried on according to the specification of the customer’s order, it is popularly known as “job-lot manufacturing�. Here the whole product is looked as one job which is to be completed before going on to the next. The “job-lot manufacturing�, signifies that the sales orders from the customers are obtained in advance and then they are translated into manufacturing operations.

Generally, the job-lot production is undertaken by engineering firms who are manufacturing machines and equipment according to the specifications of the customers. The material[s are procured on the basis of bills of materials prepared for each order. The cost of each job is ascertained on the basis of job costing. The orders may be of a repetitive or non-repetitive nature. In case of repetitive orders, the tools, patterns, dies etc, are stored and the product design is preserved for reproduction in the future. As repetitive orders ensure certain cost advantages to the manufacturing firm, a part of them are usually passed over to the customers in the form of reduced price for the jobs.

Advantages of the Intermittent Form:

1. It is a trade-off between flexibility and efficiency. We opt for intermittent form when flexibility is more important than efficiency.

2. It gives us a variety at low cost, since it uses general purpose machines.

3. There is high capacity utilization.

4. There are staff advantages since each worker performs a complete operation giving him pride of workmanship and sense of responsibility.

Disadvantages of the Intermittent Form:

1. It is expensive for high volumes since the variable costs are high for general purpose machines.

2. There is a problem of planning and control of complex jobs. There may be idling of resources.

3. There is a large in-process inventory and there is a heavy build-up of WIP if PPC is not well geared.

4. Material handling equipments are costly and require more space.

New Frontiers of Intermittent Form:

These days we have increasingly adopted Computerized Production and Inventory control Systems to enhance PPC function. There is Integrated Computer-Aided manufacturing where computers are used to plan the operation and also for the execution of operations too. Group Technology where groups are organized in the transaction process is picking up to tide over the demerits of intermittent form. Grouping is made for components, machines, equipment and people. The machines, equipment and groups are called ‘cells’. Volumes through a cell are higher and variety lower. Each group gets the characteristics of continuous form. Besides it is cost effective and time effective since the nature of operations in a group are similar. There is reduced material handling since machines are close in a cell. The waiting period between operations is also reduced. This also results in a reduced WIP inventory.