Answer to Question #249690 in Management for sagar

Question

MG Motors have been having a tough time from the time of their launch in India. They feel that there have been a lot of pilferages and wastage in their production and they need to sort it out as soon as possible. Also, the time taken to manufacturer one unit of their cars is extremely high as compared to global benchmarks. They have hired you as a consultant for the same? Can you explain the concepts of JIT and Lean Production to them and help them apply the same in order to reduce their troubles?

Answer 1

Lean production is a production methodology focused on eliminating waste, where waste is defined as anything that does not add value for the customer. Although Lean's heritage is manufacturing, it is applicable to all types of organisation and all an organisation's processes. While JIT is an inventory management method in which goods are received from suppliers only as they are needed. The main objective of this method is to reduce inventory holding costs and increase inventory turnover.