Elimination of non-value added activity
JIT manufacturing can be described as a philosophy of management, dedicate to the elimination of waste. Waste is stated as anything which does not add value to a product.
The cycle time involved in manufacturing and selling a product consist of:
• Process time-add values
• Inspection time
• More time
• Queue time
• Storage time
Of these 5 steps only process time actually adds value to the products. All the other activities add cost and No value to the production and therefore are deemed as non-value within the JIT philosophy.
Usually in many companies, process time is less than 10% of total manufacturing, lead and cycle time. Therefore 90% of the manufacturing lead time disassociated with the product, adds cost but no-value to the product by adapting a JIT philosophy and forecasting, on reducing lead time, it is claimed that total cost can be significantly reduced.
The ultimate products with lead-time = processing time, and eliminating all non-value adding activities.