Logistics concept "JUST-IN-TIME" (just in time)

The most widespread logistics concept in the world is the just-in-time (JIT) concept. It appeared in the late 1950s, when Japanese Toyota company Motors, and then other Japanese automakers, began to actively implement the KANBAN micrologistics system. The name of this concept was given a little later by the Americans, who also tried to use this approach in the automotive industry. The original slogan of the just-in-time concept was the potential elimination of inventories of materials, components and semi-finished products in the production process of assembling cars and their main components. The main idea of ​​the JIT concept is as follows: if the production schedule is given (abstracting from demand or orders for now), then the movement of material flows can be organized in such a way that all materials, components and semi-finished products will arrive in the required quantity, to the right place (on the assembly line - conveyor) and exactly on time for production or assembly finished products. At the same time, insurance stocks that immobilize cash companies are not needed.

The ELA Terminology Dictionary defines JIT as an approach to success that is based on the consistent elimination of waste (waste is any activity that does not add value to a product). It is also about delivering materials at the right time and place.

The JIT concept served as the basis for the subsequent introduction of logistics concepts/technologies such as flat or lean production and value-added logistics.

From a logistics perspective, the just-in-time concept assumes that flows material resources carefully synchronized with the need for them, specified by the production schedule for the release of finished products. Such synchronization is nothing more than the coordination of two basic logistics functions: supply and production management. This concept has been successfully applied in distribution, finished product distribution systems and macro-logistics systems. Taking this into account, we can give the following definition.

The concept of "just in time" is a modern concept/technology of construction logistics system in production (operational management), supply and distribution, based on the synchronization of the processes of delivery of material resources and finished products in the required quantities by the time the parts of the logistics system need them, in order to minimize the costs associated with the creation of inventories.

The just-in-time concept is closely related to the components of the logistics cycle. Ideally, material resources or finished products should be delivered to a certain point in the logistics chain (channel) exactly at the moment when they are needed, which eliminates excess inventory, both in production and distribution. Many modern logistics systems based on this approach are focused on short components of logistics cycles, and this requires an adequate response of the logistics system units to changes in demand and, accordingly, production program.

The just-in-time logistics concept is characterized by the following main features:

• * minimal (zero) inventories of material resources, work in progress, finished products;
• * short production (logistics) cycles;
• * small volumes of production of finished products and replenishment of stocks (supplies);
• * relationships for the purchase of material resources with a small number of reliable suppliers and carriers;
• * effective information support;
• * high quality finished products and logistics services.

The introduction and spread of the just-in-time concept throughout the world has led to a change in the traditional management approach to inventory management.

The widespread use of the just-in-time concept in logistics practice is explained by the low level of inventories of material resources, work in progress and finished products; reduction of production space; improving product quality and reducing defects; reduction of production time; increased flexibility when changing the product range; high productivity and efficient use of equipment; active participation of workers in solving production and technological problems; good relations with suppliers, etc.

The goals of just-in-time are similar to the goals of a materials requirements planning system—to provide the required part of a product in a timely manner. right time to the right place, but the ways to achieve these goals and the results are completely different. While the materials requirements planning system is built on calculations, the continuity system is built on industrial engineering. There are many distinctive features of the just-in-time system, which are manifested in practice in any type of activity, in a company of any form of ownership, in the production or non-production sector of the economy.

Implementing the JIT concept begins with answering the questions of how the product will be sold and whether it can be easily manufactured. If these questions are answered positively, attention shifts to developing the process itself.

The operation of a logistics system built on the principles of the just-in-time concept can be represented as a two-bin inventory management system. One bunker is used to meet the demand in production or sales, respectively, for material resources or finished products, the other is replenished as the first one is consumed. The emphasis is on placing equipment in such a way as to ensure a continuous production process. Where possible, automation of both the production process and the processing of raw materials is introduced. Equipment is often placed in a U shape, which helps teamwork, flexibility of work, cyclicality in the processing of raw materials and products. At the same time, product developers strive to standardize time cycles and produce a constant set of products based on monthly production plan throughout the entire system. This practice turns the production process into a cycle of at least a month.

Thus, the production of finished products in small batches over relatively short production cycles determines the duration of the material resource supply cycles.

Theoretically, the ideal order size for a basic JIT system is one unit, but this is typically not realized due to the high costs of marketing and processing each order.

Logistics systems that use the principles of the just-in-time concept are “pull” systems, in which orders for replenishing inventories of material resources or finished products are placed when their quantity in certain links of the logistics system reaches a critical level. . In this case, stocks are “pulled” through distribution channels from suppliers of material resources or logistics intermediaries in the distribution system.

In the just-in-time concept, demand plays a significant role, determining the further movement of raw materials, materials, components, semi-finished products and finished products. Short components of logistics cycles in systems using this approach contribute to the concentration of the main suppliers of material resources near the company carrying out the process of production or assembly of finished products. The company tries to select a small number of suppliers with a high degree of supply reliability, since any supply disruption could disrupt the production schedule.

In the practical implementation of the just-in-time concept, product quality plays a key role. Japanese automobile manufacturers, having initially introduced the principles of this concept and the KANBAN micrologistics system into production, changed their approach to quality control and management at all stages of the production process and subsequent service. Ultimately, this resulted in the already mentioned philosophy of total quality management. The just-in-time concept helps to strengthen control and maintain the level of product quality across all components of the logistics structure. Micrologistics systems based on this approach, associated with the synchronization of all processes and stages of supply of material resources, production and assembly, delivery of finished products to consumers, require accurate information and forecasting. This explains, in particular, the short components of logistics (production) cycles. For effective implementation of JIT technologies, they must work with reliable telecommunication systems and information and computer support.

The Dell company at one time managed to rise largely due to the competent organization of the just-in-time system. At the beginning of his journey, Michael Dell decided to rely on direct sales, which allowed him to significantly reduce the company's costs. While thousands of components were gathering dust in the warehouses of other computer manufacturers, Dell organized a system that made it possible to have only the necessary goods in stock. Assembly of the computer began only after it was ordered.

As a result, Dell sold the computer cheaper than its competitors and was able to update its line of components much faster. For comparison, Dell began installing the Pentium 4 processor in its computers 85 days before HP came to this. There simply wasn’t such an abundance of unsold P3s in the company’s warehouses.

What's the point?

Dell's success story is probably the most famous and often cited when it comes to the concept of just-in-time delivery. However, this concept did not originate in the USA, but in Japan, like most modern technologies management related to lean manufacturing. Why in Japan? There may be several reasons. Firstly, the Japanese themselves are quite thrifty people. Their country is very limited in terms of natural resources, so these people are not used to wasting materials. Secondly, it is worth paying attention to the culture of Japan. People here are used to trusting their word. If a company must deliver goods every day, then it will do so. There are no such frequent incidents and breakdowns as in the USA and Europe in Japan. And it wasn't. This is a purely cultural aspect.

So, what is the essence of the just-in-time concept? Just-in-time is a product supply system that allows a company to get rid of large inventories. When using a just-in-time delivery system, a special schedule is created that indicates when and how many goods will be delivered. Moreover, deliveries are often made daily. Obviously, the main advantage of such a system is its flexibility (example with Dell and Hewlett-Packard above) and the ability to reduce warehouse costs.

A certain problem immediately arises. It is quite difficult to organize a supply system that will work without failures. After all, it turns out that when using just-in-time deliveries, the company begins to depend on its supplier. In case of any unexpected problems on his side, the company will also suffer. It may even be necessary to temporarily suspend production or sales of products. Finally, rising transportation costs may result in Just-in-time being an ineffective system for a particular application. It is quite possible that it will be more profitable to store goods in a warehouse than to constantly deliver them (here it is immediately worth noting another important point, why just-in-time deliveries originated in Japan - the distances in this country are much shorter than those suppliers from Europe and America are forced to undergo).

Today Just-in-time is used not only in production, where the technology was introduced, but also in retail trade. Moreover, even a small business can easily use this system. True, not always and not everywhere. Everything here is very individual. You always need to calculate whether it is profitable for the company to use such a supply system, or whether it is better to continue storing inventory. For example, in Russia, just-in-time deliveries have many problems, since, according to statistics, our suppliers are not nearly as obligatory as in Japan. However, this does not prevent domestic companies from successfully implementing this supply system.

How it all began?

The just-in-time delivery system was brought to life by Toyota in the middle of the last century. It is believed that there was strong growth in the company's car production at that time. With the growth of production, a significant problem arose. The company's warehouses were accumulating great amount unnecessary details. All the time we had to adjust the next delivery, and they took up space for nothing. The costs of storing parts were rising. One fine day, the Japanese began to think about how this system could be improved? So they came to the conclusion that they completely reorganized the entire supply chain of the company. Now all parts were supplied to each production site, depending on how much the next one, who was the recipient of the manufactured part, required. Deliveries began to be made much more often, but at the same time the warehouse had the minimum amount of goods necessary for current production. And nothing else.

Thanks to this system, Toyota increased productivity and was able to reduce warehouse costs. The supply of goods was generally carried out so that the company could vary the scale of production within 10%. In addition, Toyota began to acquire stakes in supplier companies. Of course, Japan is famous for its ability to keep its word and fulfill promises, but it is much better to be safe. That's what they did at Toyota.

After some time, the company further modernized its supply system by introducing the kanban mechanism. My description of Kanban was not the best. I will give an option from the comments to this article from Dmitry Karpich:

"Kanban (canban - card in Japanese) is technological maps production, reflecting the scheme for creating a product or service and actually used in this production. The “card” indicates how much, what and from whom is taken to obtain the “finished” (for a given site) product from the “raw materials” of the “suppliers”. Simply put, this is a cooking recipe. This is not a production or supply plan at all (as I wrote earlier - note by the author of the article).

Kanban is required due to the specificity of the production process - the so-called “pull” production, when both the production task and the responsibility for the availability of resources fall on one shoulder. Compare with the soviet “but they didn’t bring us nuts, so there won’t be any tractors”!”

Needless to say, this implementation was revolutionary. The technology soon spread throughout Japan. And then (closer to the 80s) the USA and Europe will become interested in it. Today, Just-in-time deliveries are common throughout the world and are one of the most well-known concepts in logistics.

Advantages and disadvantages

In general, a just-in-time delivery system avoids the problem of overproduction, reduces inventories to the minimum possible level and eliminates unreasonable warehousing costs. Such a system, among other things, allows you to organize production with a minimum of defects. Finally, when implementing just-in-time deliveries, companies are always striving to increase the quality of production, always looking for new ways that will allow them to work more efficiently. Let us list the advantages and disadvantages of such a supply system point by point for clarity. The benefits include:

— Reducing the production time of the final product;

— Reducing the costs of storing goods;

— Higher flexibility when changing products (remember the Dell example at the beginning of the article);

- Higher productivity; - Reduced preparation time for production;

- Improved quality control; - More uniform production schedule;

— A minimum of optional work that relates to what takes place in the warehouse;

— Minimum production disruptions;

— Low probability of overproduction;

The disadvantages include:

— increasing transportation costs. It may be cheaper to store goods in a warehouse than to constantly deliver them;

- an economic situation, for example, oil price hikes can destroy the entire system overnight;

— dependence on supply partners;

— extra work which must always be carried out during unloading;

— the possibility of downtime among workers. There is a possibility that a situation may arise where the materials are not available and the work is done. Employees will simply be foolish;

- It is not so easy to organize this system. Need good management

One of the most widespread logistics concepts in the world is the concept Just-in-time-JIT(Right on time) . The emergence of this concept dates back to the late 1950s, when the Japanese company Toyota Motors, and then other Japanese automakers, began to actively implement the KANBAN system.

The original slogan of the concept JIT there was an exclusion of potential stocks of materials, components and semi-finished products in the production process of assembling cars and their main units. The original task looked like this: if a production schedule is given, then it is necessary to organize the movement of material flows so that all materials, components and semi-finished products arrive in the right quantity, to the right place (on the assembly line) and exactly on time for the production or assembly of finished products. With this formulation of the problem, large safety stocks, freezing the company's funds, turned out to be unnecessary.

Conceptually JIT-the approach served as the basis for the subsequent introduction of such logistics concepts/technologies as Lean Production (“Flat” or “thin” production) and Value added logistics.

It is necessary to highlight and characterize the fundamental idea of ​​the method, which is based on three premises (their correctness has been repeatedly confirmed empirically).

Firstly, it is assumed that the requests of consumers of finished products should correspond not to their previously accumulated reserves, but production capacity, ready to process raw materials and supplies that come almost “from the wheels.” As a result, the volume of production inventories that qualify as frozen capacity is minimized.

Secondly, in conditions of minimal inventories, continuous rationalization in the organization and management of production is necessary, because a high volume of inventories levels out, in a certain sense, masks errors and shortcomings in this area, production bottlenecks, unsynchronized operations, unused production capacities, unreliable work of suppliers and intermediaries .

Thirdly, to assess the efficiency of the production process, in addition to the level of costs and productivity of funds, one should take into account the implementation period of the application, the so-called duration of the full production cycle. Short time implementation of applications facilitates enterprise management and contributes to increased competitiveness due to the ability to quickly and flexibly respond to changes in external conditions.

In contrast to traditional management methods, according to which the central link in production planning issues production tasks to all departments and industrial units, with the " Right on time» centralized planning concerns only the last link of the logistics chain, i.e., the finished product warehouse. All other production and supply units receive orders directly from the next one located closer to the end of the supply chain. For example, a warehouse finished products gave an application (which is equivalent to issuing a production task) for a certain number of products to the assembly shop, the assembly shop gives orders for the production of subassemblies to the processing shops and the cooperation department, etc.

This means that the production order is always issued to the department using (or processing) the part. Thus, the flow of material from the “source” to the “consumer” is preceded by the flow of information in the opposite direction, i.e. production " Right on time» preceded by information « Right on time».

This concept is based on the belief that inventories arise due to poor management, poor coordination of work, and therefore problems are hidden in inventories. From this follows the conclusion that it is necessary to find the reasons causing the difference between supply and demand, improve the execution of operations, after which the stocks will disappear. Concept Just-in-time (Right on time) leads to a change in views in the following areas:

· Inventories. Organizations must identify and solve problems that lead to inventory, striving for minimum (zero inventory) material resources, work in progress, finished goods.

· Quality. It is necessary to achieve not an acceptable level of defects, but its complete absence on the basis of integrated quality management.

· Suppliers. Customers must rely entirely on their suppliers, so they need to establish long-term partnerships with a small number of reliable suppliers and carriers.

· Volume of batches. It is necessary to look for ways to reduce the volume of production batches, to achieve short production cycles so that excess production does not accumulate in finished product inventories.

· Order fulfillment time. It is necessary to reduce lead times to reduce uncertainties that can change the situation during long delivery times.

· Reliability. All operations must be performed continuously without failures, i.e. there should be no equipment breakdowns, defects, absenteeism, etc.

· Employees. A spirit of cooperation is necessary, both between workers and between managers and workers, because... the well-being of everyone depends on overall success at work; all employees should be treated equally and fairly. Any creative initiative expressed by any employee regarding possible improvements in work.

· Information support should allow for the rapid exchange of information and synchronization of all processes of supply of material resources, production and assembly, and delivery of finished products.

Thus, JIT- This is not only a way to minimize inventories, but also to eliminate waste of any type of resource, improve coordination and increase operational efficiency.

One of the first attempts to practically implement the JIT concept just in time was developed by Toyota Motors Corporation. system KANBAN (translated from Japanese as “map”). System KANBAN represents the first “pulling” JIC in production, the implementation of which took Toyota about 10 years from the start of development. Such a long period is due to the fact that the system itself KANBAN could not operate without an appropriate logistics environment.

The key elements of this environment were:

· rational organization and balance of production;

· comprehensive quality management at all stages of the production process and the quality of initial material resources from suppliers;

· partnership only with reliable suppliers and carriers;

· increased professional responsibility and high work morale of all personnel.

System KANBAN, first introduced by Toyota Motors Corporation in 1972. at the Takahama plant (Nagoya), is a system for organizing continuous production, which allows you to quickly rebuild production and practically does not require safety stocks. Essence of the system KANBAN lies in the fact that all production divisions of the plant, including final assembly lines, are supplied with material resources only in the quantity and within the time period necessary to fulfill the order placed by the consumer division. Thus, in contrast to the traditional approach, the structural unit-manufacturer does not have a general rigid operational production schedule, but optimizes its work in the order volume that follows the production and technological cycle of the company unit.

Micrologistic system KANBAN originated from assembly line production, but its principles can be applied throughout the supply chain and in any type of production. KANBAN is a “pull” system that is driven by demand at the “rightmost” point of the supply chain.

The main goal is to produce only the required quantity of products in accordance with the demand of the final or intermediate (subsequent) consumer. For example, when components are needed on an assembly line, they are supplied from the previous production site along the chain in the right quantity and at the time when they are needed. And so on throughout the entire production logistics chain.

System KANBAN significantly reduces inventories of material resources at the input and unfinished products at the output, allowing one to identify bottlenecks in the production process. Management can direct attention to these bottlenecks to solve problems through the most beneficial means. Once the problem is resolved, the buffer stock is reduced again until the next bottleneck is discovered. Thus, the system KANBAN allows you to establish balance in the supply chain by minimizing inventories at each stage. The ultimate goal is “optimal batch of one delivery.”

The means of transmitting information in the system is a special card KANBAN in a plastic envelope. Two types of cards are common: selection and production order. The selection card indicates the number of parts (components, semi-finished products) that must be taken at the previous processing (assembly) site, while the production order card indicates the number of parts that must be manufactured (assembled) at the previous production site. These cards circulate both within Toyota enterprises and between the corporation and companies interacting with it, as well as at affiliated enterprises. So the cards KANBAN carry information about consumed and produced quantities of products.

Important elements of the system KANBAN

System implementation KANBAN, and then its modified versions allows:

1. significantly improve the quality of products;

2. reduce the duration of logistics cycles, thereby significantly increasing turnover working capital firms;

3. reduce production costs;

4. practically eliminate safety stocks and significantly reduce work-in-progress inventories.

Analysis of world experience in using the system KANBAN many well-known engineering companies show that it makes it possible to reduce production inventories by 50%, inventory by 8% with a significant acceleration of turnover working capital and improving the quality of finished products.

An example illustrating the operation of the system KANBAN

The diagram shows two machining centers (MCs): MC1, which uses parts A to produce semi-finished products B, and MC2, which uses semi-finished products B to produce products C. First of all, a decision must be made regarding the types of containers that should be used for each position A, B , C, and their sizes, i.e. how many units of each product can fit in the container.

There is no on-site storage in the system; containers are moved from one center to another using technological transport.

Each fully filled container has a card KANBAN with the following information:

1. product code (semi-finished product, NP);

2. description;

3. products (final, intermediate), where these components are used;

4. number of the workplace (worker code) where the product is produced;

5. OC number (worker code) that uses this component;

6. number of products in a given container;

7. number of containers (cards KANBAN) next to the OC.

Cards KANBAN come in two colors: white and black. White cards are located on the containers at the entrance (in) for OC 1 and OC2 and are intended for transportation. Black cards KANBAN are located on containers at the exit position (out) and indicate permission for processing.

The information on the cards attached to the containers is specific to the specific container.

The black card of product C is the output of an empty container. In this case, it denotes a decision for OC2 (the worker behind this center) to produce as many units of product C as are required to fill an empty container. To do this, OC2 uses a whole container of parts B, where they were stored at the input of OC2, and releases the white card KANBAN(Scheme 2).

This card gives permission to transport another container with parts B from OT1 (from the exit) to the entrance of OT2. A worker on a forklift with an empty container and a white card arrives at OC1, where he removes the black card from the container filled with parts B and leaves it next to the empty container, while he attaches a white card to the filled container with parts B and transports it to OC2. Free black card B is an order for OC1 to produce the next full container of parts B. During the manufacturing process, a container with parts A is released, and the white card serves as a signal to the supplier to replenish the stock of parts A for one container, etc.

The considered example is a typical scheme of a “pull” intra-production logistics system, where containers with parts (constituting the production inventory) are moved only after the parts are consumed in subsequent areas.

Important elements of the system KANBAN are Information support, which includes not only cards, but also production, transport and supply schedules, technological maps, information light boards, etc.; system for regulating the need and professional rotation of personnel; system of integrated (TQM) and selective (“Jidoka”) product quality control; production leveling system and a number of others.

Slide 2

Features: Basic Foundation production system Toyota, production organization method; During the production process, the parts needed for assembly are on the production line exactly at the moment when they are needed, and in strictly required quantities. Results: downtime is eliminated and minimized stocks, or are reduced to zero. Key Features: Only the necessary supplies are available when needed; quality improves to “zero defects”; the duration of the production cycle is reduced; the size of the queue and the size of the production batch are reduced; operations are gradually modified; costs are minimized. 2

Slide 3

The just-in-time method was invented in 1954 at the Toyota Corporation Traditional production organization scheme Production organization scheme using the just-in-time system 3

Slide 4

Areas of application of JIT 4

Slide 5

Movement of raw materials, materials, semi-finished products, finished products using the “just in time” method 5

Slide 6

System components: production leveling; pull production; Kanban system (labels or signs); order in the workplace; production in small batches; reduction in repositioning time; end-to-end scheduled preventative maintenance; end-to-end quality control; procurement using the “Just in time” system; balanced production lines; flexible manufacturing; small group activities; Personnel training in the Just-in-Time system is carried out in short sessions (several hours a week) to avoid information overload; Just-in-Time production is preceded by a Just-in-Time information flow. 6

Slide 7

Kaizen, kaizen- (Japanese 改善 kaizen, romaji Kaizen) is a Japanese philosophy or practice that focuses on continuous improvement of production processes, development, supporting business processes and management, as well as all aspects of life. "Kaizen" in business - continuous improvement, starting with production and ending with senior management, from the director to the ordinary worker. The goal of kaizen is production without losses. 7

Slide 8

Kaizen principles: System of pulling production (pull principle); Continuous flow production; Takt time. Japanese management achieves the just-in-time principle by systematically preventing three undesirable components: MURI - surplus; MUDA – losses; MURA – imbalance. 8

Slide 9

Just-in-time. Losses (Muda)