Rethinking JIT under supply disruptions and erratic growth

A Wall Street Journal article (April 29, 2011) describes companies like Terex and Al-jon Manufacturing and their increased inventories of raw material and finished goods given supply disruptions and increased sales growth.  Whil Just-In-Time inventories enable supply to be maintained synchronized with demand, risk averse suppliers in turn demand order commitments to enable JIT delivery or themsleves switch to JIT manufacturing and thus create erratic supply lead times.  The earthquake in Japan and increased demand in developing countries thus push responsibility to the OEM to build up buffer stocks, per this article.  Are there other schemes to enable supply demand matching without building up buffer stocks ? Could domestic (US) suppliers with shorter delivery lead times enable JIT despite such uncertainties ? Will flexible manufacturing capability or reconfigurable supply chains offer a way out ?

Advertisements

About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues and tagged , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s