Inventory Control of Purchased Materials When It's Not Quite JIT

The qualification of "not quite JIT" is used to clarify the fact that a JIT environment, in its purest theoretical form, will have materials pulled through the entire pipeline without any need for inventory; the pull originating from customers, through one's own production, to supplie...

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Bibliographic Details
Published inProduction and inventory management journal Vol. 33; no. 3; p. 14
Main Author Chua, Richard C H
Format Journal Article
LanguageEnglish
Published Alexandria American Production & Inventory Control Society, Inc 01.07.1992
Subjects
Consumption
Cost control
Factories
Implications
Inventory
Inventory control
Just in time
Manufacturing
Order quantity
Philosophy
Pipelines
Product lines
Production planning
Schedules
Suppliers
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Summary:The qualification of "not quite JIT" is used to clarify the fact that a JIT environment, in its purest theoretical form, will have materials pulled through the entire pipeline without any need for inventory; the pull originating from customers, through one's own production, to suppliers (and their suppliers) in very small lot sizes, and use of the pulled materials is almost immediate. Three scenarios are presented to illustrate how a not quite JIT environment can exist. In the scenarios, an inventory model based on the philosophy of replenishment should be used to manage the purchased materials. Two basic inventory models are: 1. order point, order quantity (R,Q), and 2. order up to target (P,T). For companies that are just starting out on the JIT journey, and even for those that are in the midst of converting to JIT, this basic inventory model is an excellent analytical tool, not only in determining the total number of kanban cards required, but also in providing motivation for migrating from a not quite JIT to a truly JIT environment in one's internal operations.
ISSN:0897-8336