Just in Time- An Effective Tool to Inventory Control and Productivity

Abstract

The effort all over in present time is to enhance productivity for which each and every aspect of manufacturing and service industry need to be considered. Thus every measure needs to be taken to enhance productive efforts and to minimize wastes. One such area which may be extremely crucial is effective inventory control. Inventories are vital for the existence of an enterprise and also for its competitive edge. A well planned inventory will ensure optimum usage of raw materials, high turnover ratio, less storage time and effective utilization of working capital. A poor inventory management on the other hand will bring the profitability down, excessive inventory in hand and losses due to increasing procurement and holding cost. A number of inventory control measures are adopted by the companies such as ABC (always better control), VED analysis, FSN analysis and other techniques. Just in time philosophy is practiced all over the world which is an effective tool to enhance productivity by minimizing wastes. It is a new unconventional approach which brings down the cost of manufacture down substantially by strategic change as required by the existing system of manufacturing. It can help concreting global competitive position of the company. The present paper highlights the role of JIT in managing inventory effectively.

Keywords: Productivity, Capital Utilization, Flexibility, JIT, ABC Analysis Introduction

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