C. Inventory Management
This section explains how the case company can (or
cannot) achieve ‘zero inventory’ through implementing JIT
system (and hence some barriers of achieving ‘zero
inventory’). The interviewees pointed out that the production
process for JIT as mentioned in previous section has been
implemented quite successfully. This means that production
planning and material preparation are stable with respect to
the end consumption. In other words inventory can be
maintained at a reasonably low level.
Most interviewees, however, believed that ‘zero
inventory’ is just a kind of ideal condition subject to the
existing logistics and supply chain paradigm. Although
inventory level for most of the components or parts is
minimized by the implementation of JIT, and some parts
could achieve zero stock in the case company but not all. In
the mean time, some safety inventory cannot be eliminated
completely from the system.
According to the interviews, there is a concern about
safety inventory in Company X. Most of the interviewees
pointed out that only a few spare parts could achieve ‘zero
inventory’ after the implementation of JIT. That means most
of the interviewees do not believe that ‘zero inventory’ can
be achieved realistically in the case company. For example,
Mr. D commented that:
“Zero stock is just a kind of ideal
condition … It is nearly impossible to
reach zero stock.”
D. Quality Management
The interviewees considered that quality is a very
important factor to assure successful JIT implementation.
The concept of quality management is extended to all
workers. In addition, to ensure the JIT systems can be
implemented effectively, supplier quality management is of
vital importance. Performance indicators have been
employed to examine the achievement of suppliers in
quality, on-time delivery etc., in order to encourage
suppliers to participate in the JIT program.
E. Suppliers Management
This section discusses the relationship between the case
company and its suppliers and how the case company
manages its suppliers. Some interviewees explained that
choosing and evaluating the case company’s suppliers
objectively in JIT production system is crucial for the
development. There are about 100 major suppliers in the
case company and most of them (forty suppliers) have built
their production facilities near the case company. Thus,
(a) 3-lamp signaling system
(b) Display panel
Fig. 3. Electronic Kanban System in Company BH
Proceedings of the World Congress on Engineering 2011 Vol I
WCE 2011, July 6 - 8, 2011, London, U.K.
ISBN: 978-988-18210-6-5
ISSN: 2078-0958 (Print); ISSN: 2078-0966 (Online)
WCE 2011
suppliers can reduce the time spent in distribution and can
coordinate with the company tightly so that accurate
information can be passed to the company quickly, and
integrated JIT system could be achieved by the case
company and its suppliers.
However, there are some barriers regarding choosing and
evaluating suppliers. For instance, some interviewees
pointed out that some selection criteria cannot be enforced
because of subjective judgment of the top management, who
gave preferences to the suppliers from their own country.
A problem has been put forward by the interviewees
regarding supplier selection process. Because Company X is
an international joint-venture company, some conflicts have
occurred because of this during the supplier sele