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In a recent article, Fry [3] noted that while there are a number of companies which have successfully reduced inventories using Just-in-Time (JIT) systems, ". . . there are an equal or greater number of companies who have been unable to reduce their operating inventories." In the recent survey reported on in this article of plant managers working in plants using a JIT system, the managers reported very positive results in the inventory control area.
Since JIT systems have been in operation in the United States for over a decade, it was time to determine how successful JIT implementing firms have been. A questionnaire was developed and pretested with individuals involved in the production area. After some modifications, it was mailed to 300 plant managers. Since manufacturing firms in the auto, electronic, and machinery fields are the major industries in which JIT has been implemented, questionnaires were sent to 100 managers in each of these fields. After eliminating unusable responses from those not operating under a JIT system, the 48 usable responses of managers are reported here. Due to the relatively small number of respondents limited to three industries, the results may not be generalizable to these and other industries.
INVENTORY MANAGEMENT
One of the most touted advantages of using a JIT system is the improvement of inventory turnover which, if realized, results in numerous advantages to a firm, including improved quality, reduced costs, shorter lead times, and quicker response to customer orders. Contrary to Fry's assertion, and as would be expected when a JIT system is in place, significant improvements were noted by the managers responding to this survey. Ninety-eight percent reported an improvement in work in process (WIP), 96% in inventory turnover, 90% in amount of finished goods and tracking of inventory, and 88% realized an improvement in their inventory records. Table 1 shows the responses to the inventory control questions.(Table 1 omitted) A Likert-type scale was used in the questionnaire (-4 = great deterioration, 0 = no change, 4 = great improvement). The first column in each table shows the mean of the responses and the last column (*) shows the percentage of managers reporting an improvement by utilizing a JIT system.
In the current business environment, a firm's ability to...