What is Just in Time? Definition, benefits and conditions apply

In today's climate, the ability to organize information and resources effectively is more important than ever. At this time, the Just in time method has emerged as a management approach that helps optimize production and supply. In the content below, 1C Vietnam will analyze how to properly understand what Just in time is as well as the benefits and conditions for applying JIT.

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1. What is Just in time?

Just in time (JIT) is a production and supply management method based on producing the right product, in the right quantity, and at the right time. The main goal of JIT is to reduce waste, optimize inventory and increase efficiency.

JIT refers to the fact that the flows of materials, goods and products during production and distribution are planned in detail step by step so that the next process can be started immediately after the current process. end. This ensures that there are no stages in the production process that are delayed, pending or require workers and equipment to wait for operations. The JIT system helps optimize production activities and avoid waste.

Just in time refers to producing the right product, in the right quantity and in the required time

2. What are the benefits of Just in time (JIT)?

Besides learning what Just in time is, understanding the benefits of JIT allows businesses to apply and deploy this method more effectively. The main benefits Just in time can bring to manufacturing operations include:

2.1 Minimize waste

JIT helps reduce waste in the manufacturing process by ensuring that only components and products are produced in the quantities needed. This avoids having to stock too much and the risk of loss due to damage or product defects.

Just in time model helps reduce waste in production

2.2 Increase production efficiency

Instead of waiting for inventory to build up, Just in time focuses on production based on real demand. This results in a more flexible manufacturing process, which optimizes resource usage and increases overall performance.

Just in time increases overall performance

2.3 Increase product quality

When applying Just in time in the production process, businesses can focus on improving product quality and eliminating errors and omissions right from the early stages. This allows businesses to provide better products to the market, thereby bringing customer satisfaction.

2.4 Giving manufacturers control

In the JIT model, the manufacturer has complete control over the production process, operating on the principle of demand response. Businesses can respond to customer demand by quickly increasing production for products that are in demand and reducing production for slow-moving items. This makes the JIT model flexible and capable of meeting constantly changing market demands.

JIT gives manufacturers greater control

2.5 Optimize investment costs

By adjusting production and supply activities according to actual needs, JIT helps achieve the goal of optimizing investment costs clearly and specifically as follows:

• Minimize inventory: In the JIT model, only the necessary inventory is kept. Due to reduced inventory, lower costs allow businesses to increase profits from product sales.
• Reduce storage costs: By keeping inventory low, businesses will not need to invest in large space to store inventory. From there, businesses can save storage costs for goods.
• Reduce financial costs: Businesses can save a financial amount tied up in maintaining large inventories. Instead, businesses can use their finances for other activities such as upgrading infrastructure, investing in research and development or business expansion.
• Reduce investment costs for production: The JIT model promotes continuous improvement and optimization of production processes. Thanks to that, businesses have the ability to increase productivity and reduce waste, thereby helping to save production costs.

Applying Just in time helps businesses spend less on investment and gain higher profits

3. Conditions for applying JIT

To apply Just in time (JIT) appropriately and effectively for production activities, businesses need to meet the following conditions:

• Enterprises should have repetitive production characteristics.
• Produce small batches of nearly the same scale and receive materials throughout the production process instead of producing large batches of goods for inventory and capital stagnation.
• The production and distribution process of goods is organized in detail, ensuring that the next step in the process can be performed immediately after the previous step is completed, without waiting for input products. of any labor or equipment.
• Each production stage only produces a quantity of product/finished product exactly equal to the quantity required by the next production stage.
• The workers in the next process are considered customers of the previous process, they need to inspect and accept the delivered products before proceeding with the work. If the products do not meet the requirements, these products will be removed from the production process and the entire system will be notified to adjust the plan in a timely manner.
• Close coordination between manufacturers and suppliers.

To apply Just in time to production activities, necessary conditions must be met

4. Some basic principles that Just in time follows

The Just in time (JIT) model follows some important principles below.

• Only produced when there is an order from the customer.
• JIT needs to optimize customer requirements to help all resources stabilize throughout the entire factory system.
• Every step must be connected together with a simple visual management tool.
• JIT requires maximum flexibility in production resources and machinery.

Just in time needs to follow certain principles

Above, 1C Vietnam has shared the correct understanding of what Just in time is as well as the benefits of JIT for businesses. To apply the JIT model, businesses also need to understand the conditions and principles of JIT. In addition, if you want to manage production smartly and quickly, 1C:Company Management software will be a comprehensive solution for businesses. For detailed information about products and businesses, please contact 1C Vietnam for support.