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MRPII-JIT-TQM Integration
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TQM/JIT Chain Reaction

Figure 5, TQM/JIT Chain Reaction illustrates how power­ful are the synergetic benefits of integrating total quality and JIT strategies throughout an organization. It is based on the theory that only taking four tactical actions can result in several strategic benefits as a chain reaction of events ultimately leading to larger market share, faster customer response and higher profits. The first action starts with the process improvements which lead to im­proved quality. Reducing set up leads to reduced lot sizes which in turn leads to reduced lead times. The second action of JIT delivery from suppliers reduces component lead time and inventory. The third action is the leveling of production schedules which improves productivity beside reducing lead time. The fourth action is to invest in productivity by modernizing plant and equipment where it is cost effective. All these actions finally lead to improved quality, reduced costs, improved profits and in the long term, a larger market share.

Benefits

An integrated approach to MRP II, JIT and TQM initiatives provides a powerful tool for a company to take advantage of the synergetic benefits of these initiatives and their direct impact on improving quality and productivity, re­ducing cycle time and costs and thereby providing an immediate and on going competitive advantage. In particu­lar, the integrated approach can lead to as much as 60 to 70% reduction in material planning, kitting, material handling and expediting activities and 30 to 40% reduction in stores and manufacturing space. The streamlining of material flow and availability of parts for first use reduces obsolescence, reduces work in process inventory by 50 to 70% and improves inventory turns by many folds.

The virtually linear production and material flow elimi­nates redundant operations like inspection and cleaning right at the outset of implementation. The streamlined flow managed by work teams can provide initial results of 40 to 50% reduction in the manufacturing cycle time, 20 to 30% improvement in productivity and throughput and 50 to 60% reduction in scrap and rework. While actual results will vary from company to company the integrated approach will definitely provide an opportunity for considerable improve­ments in quality, price, delivery and customer satisfaction.

Conclusions

The proposed integrated framework consists of a reliable, well disciplined planning system like MRP II driving the JIT manufacturing processes that are managed and con­tinuously improved by the work teams trained on quality improvement techniques. The approach not only satisfies the day to day operating needs of a company, but it also provides for an immediate tangible result oriented imple­mentation strategy.

The approach provides a method to leverage the synergy among these and other technologies or initiatives to im­prove business performance substantially. In addition, this approach provides the opportunity for creating and internalizing world class culture inside the company before expanding it to the suppliers and customers. Following this initial implementation phase that provides credibility and a strong foundation for building a world class environment, an organization may proceed to implement subsequent phases of the initial initiatives and new initiatives or technologies as it continues on its journey for excellence.
 

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