In this paper, we are examining the implementation of Just-In-Time methodology in Ford for its latest small car KA; possibly one of the most interesting manufacturing revolution where companies involved in the production are integrated not only in their business processes moreover in their physical plants. The concept has been successfully developed and implemented in Valencia, Spain and is due to be adopted in other Ford production plants. The case study clearly shows how companies can work together in a harmonic and synchronised system meeting probably the most idealistic manufacturing principles (JIT) to produce the best quality product within the shortest time frame with minimum/no wastage and cost-effective to all parties. Careful production planning, cost-benefit analysis, adequate outsourcing plans and customer orientation are being praises as the key success factors of this amazing Just-In-Time concept.
JIT is one of the examples of early-landed future manufacturing idealism requires continuous collaborated refinements throughout its supply chain elements. It has been used since 1950s by Japanese automotive industries and yet none of the most developed countries would have even considered this methodology until early 1980s (Karlsson, 1994). Researchers tried really hard to explain JIT concept in a short descriptive sentence and none of them were able to come up with a single answer that represents everyone’s definitions. Those who were trying to bring them together were ended up with another new more complex definition. JIT goes beyond ordinary management theory or a company’s manufacturing procedures; it comprises production planning, HRM, material management, distribution, customer services not only involving individual organisation furthermore requires collaborated cross-companies dedication to continuously refine the business process of one and another.
Svensson (2001) in his journal argued that the basic of JIT is “no non-essential activity should be committed prior, during and after any production phases and wherever beneficial outsourcing is regarded as good as in-house production”. JIT is understood as event driven production concept which has been carefully planned and structured to ensure all its components ready whenever needed. It is also known as inventory-less production method which allows minimum stock level only needed for the current manufacturing phase.
Automotive manufacturing industry has become an ideal example on how JIT methodology may improve the efficiency of the whole production processes (Karlsson, 1994). By involving thousands manufacturing steps, there are always chances for refinement. This is to minimise lead times which in turn will boost the production capacity of the industry as well as its flexibility to response to the market needs. Since this industry requires large stock to meet the production needs, a better inventory management system such as JIT will be helpful in reducing costs (Claycomb, 1999).
Most authors agreed that successful JIT implementation requires five key elements to be considered (Ramarapu, 1995).
Waste reduction: this element is aimed to eliminate all non-value-added tasks (Bowen, 1998). The main problem with traditional production method is due to the focus on producing large number of items. With level of competitiveness and flexibility requirements, this is no longer an appropriate method to be performed. Value-adding production oriented: This element bring the terminology of “pull-system” which allow customer order to trigger the production process. Pull system requires immediate respond in order to satisfy customer requirement therefore avoiding “the goal of producing large batches” (Bowen, 1998). By grouping products based on their production process similarity, manufacturer may also add-value to the products by lessening production complexity, shortening travel and...