JIT as a Business Philosophy

J-I-T (just in time) should not be viewed as a mere production system. It expresses, in fact, an organization’s philosophy of customer orientation. Service to the customer is the focus of J-I-T. The production system is a consequence of this business philosophy. Service includes providing to the customer the product (necessary service) in time, providing him variety of products, allowing him to choose as per his preferences, providing him with quality products, providing him service/ product close to him (space utility), and communicating with him more intensely than before almost including him in your own facility or vice versa and above all providing product/service at a price affordable and perceived as reasonable by the customer. Such service orientation generates the need for an appropriately responsive production system such as a J-I-T system.

As the customers are to be provided a variety of products and in time, the production of the finished goods should be in very small lots. For the same reason, the upstream production processes should also produce equally small lots just to meet the downstream needs. Going upstream in this manner, it is obvious that the vendors too have to supply items in small numbers and just in time.

In order to produce a very small lot, almost a single unit at a time the prerequisites are that there are no defective items produced, which further means:

(1) the workers are motivated to produce defect-free items; they feel more responsible;
(2) the worker, therefore, should be empowered to take his own decisions with respect to the item; that he inspects his own produce; that there should be minimum supervision, limited to guidance and counsel when required;
(3) the worker should be multi-skilled, so that in case of problems they could help each other; and
(4) the vendors must also produce defect-free products, perform self-inspection and certify.

Human relation is therefore, at the core of J-I-T, and these human relations include vendors, employees, dealers and customers i.e. the entire value chain. Thus, J-I-T is about the ‘Time’ dimension because the organization respects and cares for the customer. This ‘care’ is shown in several ways including the timely service.

The Indian Response:

Of late, Indian businesses have also been increasingly realizing the importance of time as a dominant dimension of global competition. Otherwise, the typical Indian reaction to any kind of competition has been to lower prices and not to compete based on quality and time as expected by the customer. It is somewhat heartening to see companies such as Dabur Group Foods Division introducing one new brand on every successive Monday during a span of six weeks. Coates, the Rs 1,600 million ink-makers have set up an on-line computerized system linking every point from which information originates within the value chain: sales offices, depots, factories, transportation hubs and major suppliers. This real time information infrastructure is visualized to be integrated further to include materials ordering, inventory management, production coordination, accounts and billing and also personnel management. Thus, Coates can have a large variety of products along with enhanced speed of order execution. BPL Group designed its new models of color televisions much before the market was ready for them, in anticipation of the customer demand. This gave them the head-start, much ahead of their competitors. Cadbury India, the more than Rs 3,000 million Confectionary Company responded to the challenge of meeting the customer demand which is, generally impulse driven and hence difficult to predict, by streamlining the downstream and upstream activities in the entire value chain so that the system can respond quickly to the changes in customer requirements.

Likewise, participative management and treating the employee as a member of a family can be best benchmarked against the typical Indian family, which has a hierarchy-grandfather, grandmother, parents, uncles, aunts, brothers, sisters, cousins, etc. but they all participate and live together.