Case study:

JIT at Selmeniccha Inc. Selmeniccha Inc. has one main plant in the Indian state of Tamil Nadu that makes a range of plactic injection moulded components. These are sold to more than 100 manufacturers. Recently, they have been changing their operations in response to a major customer, The Sunit Instrument Company. Sunit makes parts that are eventually used by car manufacturers. Most of its business is with other Indian companies, but an expansion strategy has led it to deliver more widely, and it recently won a contract to supply a major European company. This means that it has to adapt its own operations, and in particular introduce total. quality management and just-in-time operations.

Although SelMeniccha is several tiers up the supply chain, it is affected and also has to adjust operations to meet more demanding standards. Jaydeep Julami is the production manager at SelMeniccha, and is considering the changes he has to make. The company makes 30 main products and 120 minor ones, and the plant work a single shift for five days a week. Their current production planning is based on a regular six week cycle. The first 15 days of this cycle are spent making the main products, and the next 15 days making minor products. This schedule was designed to reduce the disruption of changing production from one product to another. Each change usually takes less than an hour, but could take up to four hours if things go wrong.

A dashboard instrument panel is typical of SelMenicchas main products. Annual demand is around 200 000 units, which the company makes in batches of 25 000 and sends to a store of finished goods. When customers order the panel there is a minimum order quantity of 10000. Most orders are met from stock, but if SelMeniccha do not have enough stock they occasionally schedule production. This gives a weeks delay, as well as upsetting the schedules of other products.

Transport is arranged by a local company, who pick the parts up from SelMeniccha and deliver them directly to customer, usually within two weeks. Within India, the transport company uses rail and road transport along with their own warehouses to make deliveries in three to four weeks. Export orders are generally shipped from the nearest port of Chennai, with a lead time that depends on the final destination.

Jaydeep was reading an article about Hewlett-Packards introduction of JIT. This said that they introduced JIT in seven stages:

1 design an efficient mass production process,

2 implement total quality management,

3 stabilize production quantities,

4 introduce kanbans

5 work with suppliers,

6 continually reduce stocks,

7 improve product designs.

Hewlett-Packards experience might be useful in SelMenicchas plant. He knew roughly what was involved, but was certainly not confident that he could get JIT to work.

Questions:

1. Describe in detail the steps that Hewlett-Packard used to introduce JIT.

2. Though this short story has limited information, do you think that SelMeniccha should consider JIT? In explanation you can use the steps in the previous answer. What benefits could they get?