Mapusao,Jinky D._POm_project_ Booklet

Jinky Dela Rosa Mapusao Author 1|Page

FOREWORD This booklet provides knowledge and benefits that can be adopted by the service sector in enhancing customer service. It also tackled the eight waste of production processes that can help the service sector identify the same waste they encounter and arrive at a plan to minimize and eliminate them. The purpose of this booklet is to integrate the principles of the Just in Time system (JIT) in the service sector to uncover quality problems and solve them. 2|Page

TABLE OF CONTENTS Contents Page Title Page i Foreword ii Table of Contents iii Introduction 1 Principles of JIT 2 1. Total Quality Management 2 2. Production Management 2 3. Supplier Management 3 4. Inventory Management 3 5. Human Resource Management 4 Seven Waste of Production 4-8 JIT in Manufacturing 8-9 Areas of Greatest Potential in Improving Performance 10-14 References 15 Certification 16 About the Author 17 3|Page

INTRODUCTION Expanding global competition, emerging new technologies and improved communications have increased customer expectations for full satisfaction with the products and services they purchased. Consequently, in recent years, many manufacturing and service companies have been challenged to increase their focus on customer satisfaction and the quality of products and services. Confronting the challenges of global competition, companies worldwide are forced to find ways to reduce cost and improve quality and meet the everchanging needs of their customers. One successful solution has been the adaptation of Just in Time (JIT) manufacturing systems, which involve many functional areas of a company such as manufacturing, engineering, marketing, and purchasing. Just in Time was developed in Japan in the 1950s and subsequently achieved considerable success at Toyota. JIT can be defined as an operating concept designed to eliminate waste. Waste is defined as anything other than the minimum amount of equipment, materials, parts, space, and workers’ time, which are absolutely essential to add value to the product or service. The JIT process has been primarily applied to the manufacturing industry. Its obvious and measurable applications for manufacturing make it relatively easy to employ in a manufacturing environment. A more elusive area for the application of JIT is the service industry. Service environments with repetitive operations with high volumes, and with tangible items such as mail, checks, or bills are expected to benefit more from the application of JIT principles. Services are much like manufacturing, in that both employ processes that add value to the basic inputs used to create the final product. JIT focuses on the process, not the product. It can, therefore, be applied to any group of processes, whether manufacturing or service. The philosophy behind JIT is to continuously seek ways to make processes more efficient. The ultimate goal of JIT is to produce a good or service without waste. This goal is approached by testing each step in a process 4|Page

to determine if it adds value to the product or to the service. If the step does not add value, then, it is examined closely to determine possible alternatives. In this way, each process gradually and continually improves. Thus, one of the key requirements of JIT is the constant and continual testing of processes, whether they are in manufacturing or in services. PRINCIPLES OF JUST IN TIME (JIT) Total Quality Management Total quality management (TQM) is the continual process of detecting and reducing or eliminating errors in manufacturing, streamlining supply chain management, improving the customer experience, and ensuring that the employees are up to speed with training. PRODUCTION MANAGEMENT Just-in-time manufacturing is a workflow methodology aimed at reducing flow times within production systems, as well as response times from suppliers to customers. 5|Page

SUPPLIER MANAGEMENT JIT is a form of inventory management that requires working closely with suppliers so that raw materials arrive as production is scheduled to begin, but no sooner. The goal is to have the minimum amount of inventory on hand to meet demand. INVENTORY MANAGEMENT Just-in-time (or JIT) is an inventory management method in which you keep as little inventory on hand as possible. That means you don’t stockpile products and raw materials just in case you need them—you simply reorder products to replace those you’ve already sold. 6|Page

HUMAN RESOURCE MANAGEMENT Successful just-in- time (JIT) implementation requires a multiskilled group-oriented and self-disciplined workforce with good quantitative skills. EIGHT (8) WASTE OF PRODUCTION Excessive Transportation Excessive movement of people, information, or goods resulting in wasted time, effort, and cost 7|Page

Unnecessary Inventory Excessive storage and delay of information or product, resulting in excessive cost and poor customer service Unnecessary Motion Poor workplace organization results in poor ergonomics. e.g. excessive bending or stretching and frequently lost items. 8|Page

Waiting Long periods of inactivity for people, information or goods, resulting in poor flow and long lead times. Overproduction Producing too much or too soon, results in a poor flow of information or goods and excess inventory. 9|Page

Inappropriate processing Going about work processes using the wrong set of tools, procedures, or systems, often when a simpler approach may be more effective. Defects Frequent errors in paperwork, product quality problems or poor delivery performance. 10 | P a g e

Skills The waste of unused mental capacity of employees. JIT IN MANUFACTURING Owing to its relatively small geographical area, Japan was forced to find ways to efficiently use its scarce resources. The Japanese have turned these disadvantages into advantages by successfully developing and implementing JIT production systems. They view the manufacturing process as a network of linked work centers where the optimal arrangements enable each worker to finish his or her task and deliver it to the next worker exactly when it is needed. The ultimate goal is to completely eliminate all waiting time so that inventory investment can be minimized, production lead time can be shortened, demand changes can be quickly addressed, and quality problems can be uncovered and solved. JIT can be seen as a new way of thinking, planning, and performing with respect to manufacturing. JIT is simple, efficient, and has minimum waste. The basic principle of JIT is to eliminate all forms of waste, defined as anything that does not add value to the product. The first step is to identify activities that are waste-producing. 11 | P a g e

JIT also emphasizes simplifying the manufacturing process in order to quickly detect problems and force immediate solutions. Several researchers recognize JIT as a system-wide approach to manufacturing that focuses on the timely delivery of quality products sought by the customer and the elimination of waste. The implementation of a JIT system yields minimum inventories by having each part delivered when it is needed, where it is needed and, in the quantity, needed to produce the product. A JIT system enables companies to operate efficiently with the least amount of resources, and thus, improves quality, reduces inventory levels, and provides maximum motivation to solve problems as soon as they occur. In summary, the objective of JIT can be simply stated as “produce the right item, at the right time, in the right quantities”. By achieving this objective, companies work toward the elimination of waste in their manufacturing processes and realize the following benefits. 1. Lower raw material, work-in-process, and finished goods inventories. 2. Higher level of product quality. 3. Increased flexibility and ability to meet customer demands. 4. Lower overall manufacturing cost. 5. Increased employee involvement. JIT principles, if successfully applied in the service sector, should yield similar benefits to those found in manufacturing. JIT has been applied successfully to job shops, which typically produce a wide variety of custom products in varying amounts. If the principles of JIT can be utilized successfully in these diverse environments, it seems reasonable to conclude that this principle can be applied to non-manufacturing activities that are repetitive in nature. 12 | P a g e

AREAS OF GREATEST POTENTIAL FOR IMPROVING PERFORMANCE The following activities would likely demonstrate the greatest potential for improving performance in services and achieving the successful implementation of the JIT themes stated earlier. Training of Employees As the expectations of the customers from the service businesses increase, companies have started to value investments in the people as much as in investments in machines. The largest portion of service employees includes receptionists, waiters, telephone operators, insurance company claims processors, flight attendants, sales clerks, and others with low pay and little input in their companies. Companies need recruitment and training as important for service employees as for managers. Service employees who are well trained and fairly compensated provide better service, need less supervision, and are much more likely to stay on the job. Consequently, customers who are in contact with well-trained service employees are likely to be more satisfied, return more often, and perhaps even purchased more than they otherwise would. Training provides service employees the ability to identify and 13 | P a g e

resolve problems and operational weaknesses hindering organizational effectiveness and efficiency. Training service employees to perform a variety of service activities will also provide an organization with a great deal of flexibility. Proper training and empowerment will allow these workers to resolve any perceived conflicts before they become a negative service encounter for the customer. Hotel desk clerks or airline counter employees, for example, should have the training and authority to make a decision whether a customer should be given some form of restitution to ensure a positive service interaction. Lay-out Another applicable JIT technique involves re-layout and merger of operations. Service employees should tasks are interrelated should be physically close together, which facilitates better information flows and reduces throughput time. Layout changes should be allowed in order to improve operations. Service companies must strive to remove communication barriers and facilitate effective communication by proper layouts. 14 | P a g e

Quality One of the basic requirements for successful implementation of JIT is the existence of total quality management (TQM) principles. One simple way to achieve quality in service is the establishment of processing consistency. Employees must perform their task for correctly for the first time, which requires adequate education of employees as to the proper way to perform their tasks. The use of “quality circle” concept can be helpful in-service companies. The employee’s ideas for improving the quality of the services and increasing the satisfaction of customer should be carefully analyzed and implemented. In order to improved the quality of the services being provided, the existence of a mechanism to identify the individuals who are responsible for the performance of the different tasks enables the individuals to perform their task properly. Another benefit of this mechanism would be the identification of quality related problems and solutions for this problem. 15 | P a g e

Standardization The emphasis on the standardization of activities arises from balancing between processes, which is expected to improve operational effectiveness and efficiency. By standardizing job activities, resources can be focused on only few areas. The resulting impact on productivity can be significantly higher if one standardizes activities and concentrates organizational efforts and resources on those limited activities. Standardization of activities also reduces the time and cost of cross-training workers, but the “flexibility” theme has to be maintained in order to serve those customers with different needs. 16 | P a g e

Service Delivery One of the desired outcomes of JIT is reduced lead time for delivering the product or the service. The effort for lead time reduction begins with order entry and setting due dates. Simplifying the procedures for any other paperwork relating to this transaction will help considerably reduce the order processing time. 17 | P a g e

REFERENCES: Just In Time (JIT) Production (n.d.) Retrieve from Lean Manufacturing Tools: https://leanmanufacturingtools.org/just-in- time-jit-production/ Skhmot, Nawras (2017, August 5th ) The 8 Waste of Lean Retrieve from https://theleanway.net/The-8-Wastes-of-Lean Duclos, Leslie K.,et al.JIT in Services Retrieve from Researchgate: https://www.researchgate.net/publication/235259449_JIT_in_Servi ces_A_Review_of_Current_Practices_and_Future_Directions_for_ Research 18 | P a g e

CERTIFICATION This is to certify that this booklet entitled “Just in Time: Principles and Benefits in Service Sector” written by Jinky Dela Rosa Mapusao has been examined and found to be in accordance with the suggestions/ recommendations of the editor. This booklet was edited by the undersigned on structure and grammar only and not with the content. PONCIANO J. PUSE Editor 19 | P a g e

About the Author Jinky D. Mapusao is a Master in Business Administration Student at the Camarines Norte State College and a holder degree of a Bachelor of Science in Accountancy in the same institution. She is currently working as Administrative Assistant I in the same institution in one of its satellite campuses, the College of Trades and Technology as a campus Bookkeeper. Her experience in a public and private agency made this booklet more relevant and useful to readers. 20 | P a g e

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