21.26 JIT production, operating efficiency

Mannklein AG is a major manufacturer of metal-cutting machines. It has plants in Frankfurt and Stuttgart. The managers of these two plants have different manufacturing philosophies.

Liisa Kurunmki, the recently appointed manager of the Frankfurt plant, is a convert to JIT production and had fully implemented JIT by January 2018. Thomas Ahrens, manager of the Stuttgart plant, has adopted a wait-and-see approach to JIT. He commented to Kurunmki : In my time, I have forgotten more manufacturing acronyms than you have read about in your five-year career. In two years time, JIT will join the manufacturing buzzword scrapheap. Ahrens continues with his well-honed traditional approach to manufac- turing at the Stuttgart plant. Summary operating data for the two plants in 2018 are as follows:

	JanuaryMarch	AprilJune	JulySeptember	October December
Manufacturing lead time (days)
Frankfurt	9.2	8.7	7.4	6.2
Stuttgart	8.3	8.2	8.4	8.1
Total set-up time for machines/ Total production time
Frankfurt	52.1%	49.6%	43.8%	39.2%
Stuttgart	47.6%	48.1%	46.7%	47.5%
Number of units requiring rework/ Total number of units started and completed
Frankfurt	64.7%	59.6%	52.1%	35.6%
Stuttgart	53.8%	56.2%	51.6%	52.7%

Required 1. What are the key features of JIT production? 2. Compare the operating performance of the Frankfurt and Stuttgart plants in 2018. Comment on any differences you observe. 3. Kurunmki is concerned about the level of detail on the job-cost records for the cutting machines manufactured at the Frankfurt plant during 2018. What reasons might lead Kurunmki to simplify the job-cost records?