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02 Business

The Just in Time Method

Working as a manager at the Toyota Motor Company in the 19503, mechanical engineer Taiichi Ohno was the head of a machine shop that produced parts used on Toyota’s vehicle assembly lines.

Ohno felt the need to develop a more cost-efficient way to store inventory before the parts were used on the assembly lines.

He also wanted to improve the quality of the parts used on Toyota automobiles.

By meeting these goals, Mr. Ohno transformed the way that Toyota and other companies inventoried their products with his Just in Time (JIT) method.

Daring the 19503, companies like Toyota retained several large warehouses as space where their inventory could be stored before it was needed on the assembly line.

Parts that were used to build their products sat on a shelf in the warehouse for months at a time before being sent to the production area.

If a part had a detect, it was not discovered until the parts were at the assembly line ready to be used.

Parts were produced in mass numbers on large machines, and it was possible that an entire shipment might consist of defective parts.

As the assembly line worked on a rigid schedule, there was no time to look for defects or correct them.

As a result, the company would often not notice that it had defective parts until after the-products were already assembled.

To fix these defective products, companies sometimes had to disassemble the entire finished unit, resulting in huge amounts of lost time and money for the company.

Taiichi Ohno believed that the company could avoid these defects by introducing parts to the assembly process as they were needed instead of letting them remain in storage for months.

Not only would this make it easier to spot defects, but it would also save the company money on storage space.

Mr. Ohno developed a system that was able to reduce component assembly times from hours to minutes.

In doing so, he then sent only the parts that were needed at the assembly line out in a small, wheeled cart called a Kanban.

Since employees were now working with one part at a time, they were able to recognize any defective parts more easily.

If a defect or problem was discovered, the workers were taught to recognize it and repair it quickly, rather than using several defective parts before realizing it.

Production workers used the parts and sent the cart back empty.

This alerted others that more parts were needed on the production floor.

Another full cart would then be sent out just in time for assembly.

The system, dubbed the Kanban system, saved the company a huge amount of time and money in the long run.

Eventually, Ohno was able to get rid of the warehouses in which parts had previously been stored.

As intended, his system identified defects much more quickly and improved the quality of the parts that were produced.

The process was formally called the Just in Time method and led to widespread changes in the production methods of industries across the world.

Taiichi Ohno revolutionized product inventories with his innovative JIT method.

Not only did Toyota benefit, but many other companies adopted similar practices as well.

Ohno’s vision transformed the way products were made in these industries.