Chapter 02. Strategic Decision Making{0}
Toyota focuses on the Just-in-Time manufacturing system. ‘Kanban’ concept, which was one of the principles on which Toyota’s JIT was based. The Kanban philosophy is Developed by the Japanese, the JIT production system was one of the most significant production management approaches of the post World War II era. The system comprised a set of activities aimed at increasing production volume through the optimum use of inventories of raw materials, work-in-process, and finished goods. In a JIT production system, a workstation gets a part just in time, completes its work and the part is moved through the system quickly. JIT was based on the principle of producing only what is needed and nothing more than needed. That lead Toyota to first prize in America market.
Although many automobile companies around the world adopted JIT, the system was far from perfect and difficult to implement. It was based on the key assumption that sources and channels of supply were reliable and dependable at all times. Moreover, JIT involved high set up costs and Special training and reorganization of policies and procedures in the company were necessary to implement JIT. The supplier relations of the company also needed to be improved to ensure timely delivery. In the absence of good supplier relations, JIT increased the risk of inventory shortage.
This is very famous manufacturing system. And I actually saw many Toyota cars near my home. I think JIT also based from estimate demands and supplies. And after consider about environmental datas they can decide how many car they will make or how many inventory they need.
Toyota’s JIT Revolution
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