Answer to Question #269637 in Management for Cheena

Question

2. 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 manufacture 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

MG Motors should use just-in-time (JIT) inventory, which is a strategy used by manufacturers to boost efficiency and reduce waste by receiving products just when they are required in the manufacturing process. As a result, inventory costs will be reduced. Importantly, MG Motors producers must precisely predict their needs. JIT eliminates the waste associated with overproduction, waiting for materials, and stockpiling extra inventory. Just-in-Time manufacturing entails a producer producing just what is required, only when it is required, and only in the amount required. Manufacturers may cut overhead costs by using the just-in-time inventory strategy, which ensures that parts are constantly accessible to make their goods. This enables the organization to better serve its clients while also cutting the cost of doing business. Excess inventory storage may be highly costly. Reducing inventory might help you save money on carrying costs. By utilizing the just-in-time inventory strategy, MG Motors may be able to minimize the number of warehouses they own or possibly remove those warehouses entirely.