JIT Manufacturing and Inventory Control System
Since the dawn of human existence evolution in all sectors of society has occurred due to Economic factors. This has mainly happened due to the fact that all technological achievements have occurred in favor of money.
Specifically we can admit that Economy is the main reason for growth and development. By these means it is in our interest to establish strong economies either as societies (macroeconomics) or as individuals (microeconomics). For these reasons several techniques and methods have been initiated in order help modern individuals to develop. Such techniques are usually Accounting or Managerial in their nature. However one of the most important technique is both an Accounting and a Managerial technique and is called "The just in time method".
Just in time manufacturing "was an inventory control approach that was developed by Taiichi Ohno at Toyota Motor Company of Japan. Specifically it requires that "the exact quantity of defect-free raw materials, parts and subassemblies are produced just in time for the next stage of the manufacturing stage" (Ivancevich-Lorenzi-Skinner, p 427). That actually means an inventory is never large and by this way cost is being reduced due to the fact that there are no losses of materials due to bad demand or spoilt. This method is totally a demand - driven process since inventory value represents the exact value of raw materials, parts or subassemblies that must be spent to satisfy orders that have already taken place. By these means the company is never overstocked and that has as an affect that the company will never have a liquidity ...