Just in Time

Topics: Supply chain management, Supply chain, Logistics Pages: 10 (3110 words) Published: January 28, 2013
1. Introduction
1.1. Background
The general understanding of the logistics system is primarily connected with the value system and value chain of Porter. The value system describes the distribution channels from the supplier to the manufacturer to the channel and finally to the customer, all of them are in interdependency to each other. Achieving long lasting and effective relationships among all parties are the overall goals of the value system (see figure 2). Taking a deeper look on the manufacturer, one gets the idea of the value chain, which consists of primary and support activities. The primary ones include activities, which have a direct impact on adding value to product or service creation. Secondary activities support these, which means that they have an indirect contribution on establishing this product or service (see figure 2) (Porter, 1985). Figure 1: (Porter, 1985, p. 35)

Figuren 2: (Porter, 1985, p. 37)
As visible in figure 1 above, the first step of the primarily activities is inbound logistics. It consists of “[a]ctivities associated with receiving, storing, and disseminating inputs to the product, such as material handling, warehousing, inventory control, vehicle scheduling and returns to suppliers.” (Porter, 1985, p. 39) The globalization has had a huge impact on logistical systems and because of that companies have to adjust their strategy to be more competitive. In particular the on-time delivery plays a vital role in the world of logistics page 2 of 11

(Wang, 2010). One possibility to realize these aspects in the inbound logistics is the just-intime (JIT) philosophy. “According to the JIT policy, every supplier must deliver the right amount of components, at the right time, and the right place.” (Kim & Kim, 2002, p. 25) Out of this the company achieves various goals like “cost reduction, lead-time reduction, quality assurance, and respect for humanity” (Monden, 2002, p. 147). 1.2. Problem discussion

After having described the background, the following lines should guide the reader towards the main idea of the paper, which results in the research question. According to Lambert, 2004 “supply chain management is the integration of key processes from end user through original suppliers that provides products, services, and information that add value for customers and other stakeholders”. (Jonsson, 2008, p. 5) In order to realize a JIT system all parties along the supply chain need to be linked together. This paper is going to focus on the car manufacturer’s point of view towards a supplier. As a matter of fact a supplier evaluation plays an important role when selecting a supplier for a long term relationship (Jonsson, 2008). When selecting a future supplier companies should take a look at the geographical location of the supplier as transportation costs are minimized through this (Kaneko & Nojiri, 2008). Choosing the suitable articles for JIT and building relationships with suppliers in the company’s closer geographical environment are factors influencing the determination for implementing a JIT philosophy for car producing companies being discussed in this paper. To realize the first one, the demand and value of the articles have to be evaluated through an ABC- and XYZ-analysis. Conducting supplier evaluation is a useful tool in finding the best contractor.

Due to the fact that Toyota, a well-known Japanese car producer, implemented the first JIT system this paper is going to concentrate on car manufacturing companies. 1.3. Research Question
Which criteria are decisive for selecting suitable suppliers and articles in order to enable a successful just-in-time concept in car producing companies?
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1.4. Methodology
Our first impulse when thinking about logistic was just-in-time, because it is a central topic in every company’s way of acting. During the library workshop we learned how to use different databases on the university’s webpage. We focused on LNU OneSearch and Google Scholar....
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