What production methods. This article reports Ford’s and

What is

Inventory is
most commonly known as ‘stock’

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

Inventory or ‘stock’ as its more commonly
called in some countries is defined here as the stored accumulation of
materials resources in a transformation system. Sometimes the term ‘inventory’
is also used to described any capital management Just in time (JIT) inventory
is a management system in which materials or products are produced or acquired
only as demand requires. This approach to managing inventory has become
increasingly popular in the early 21st century as suppliers and retailers
collaborate to try to control inventory costs while still meeting customer
demands it-transforming resource, such as rooms in a hotel or cars in a
vehicle-hire firm, but we will not use that definition here. Usually the term
refers only to transformed resources. So, a manufacturing company will hold
stocks for customers. Note that when it is customers who are being processed we
normally refer to the ‘stocks’ of them as ‘queues’. This chapter will deal practically
with inventories of materials.

JIT inventory

(JIT) production methods were popularized by the excellent results achieved by
Japanese industry. When it became evident during the 1970s that the Japanese
were gaining markets previously dominated by Americans, there was considerable
interest in learning how Japanese industry operates. Then, during the early
1980s, Toyota’s highly effective JIT production system had a particular appeal
to Americans who were trying to understand Japanese production methods. While
Taichi Ohno, creator of Toyota’s production system, credits Henry Ford as the
originator, it is now known that Ernest Kanzler, one of Ford’s subordinates,
played a major role in developing JIT production methods. This article reports
Ford’s and Kanzler’s contributions and explores the possible influence that
Frederick W. Taylor may have had on the development of this approach at the
Ford Motor Company.

Key components of JIT

Elimination of waste (Any thing that doesn’t add
value) time, energy, space and an

A Broadview of operations (everyone responsible)

Simplicity (easy to understand and simple

Continous improvement

Visiblitly (clean and organsized work areas)

Flexibility (Being able to accomedate change in
customer in demand

Respect for people

Focus on consumer needs

Partnerships with key suppliers

Tools of jit

Pull system

Levelling production

Flexible resources

Cell manufacturing

Total quality managemet system


Benefits of JiT

Reduction in inventory

Improved quality

Reduced space requirements

Shorter lead times

Lower production costs

Increased productive

Increases machine utilizations

Greater flexibility


JIT management in ford

Balanced scorecard translate fords mission strategy into a
comprehensive set of performance measures.

Does not focus solely on financial gain

-highlights nonfinical objectives that ford must achieve to
achieve its long-term finicial objectives

The balanced scorecard four key perpectives

Financial (sales,cost ect.)

Customer (market share, growth, satisfaction)

Internal business processes (innovation impr)

Learning and growth (skills, workforce)

Using the balnced scorecard attempts to balance

Their finical and nonfinancial performance measures

Short run and long run performance in a single report, the
balance scorecard allows ford to reduce emphasis on short term financial
performance because; nonfinancial and operational indicators measures
fundamental c hanges

Fincial benefits of these changes may be not appear in
short-run earnings

Nonfincial measures (leading indicators) signal the prospect
of creating economic value in the future.

Translates the companies


Lack of communication as it follow a top-down management

Lack of motivation from employees when implementing this


I'm Morris!

Would you like to get a custom essay? How about receiving a customized one?

Check it out