Womack Wants To Clear The Record On JIT

Jan. 27, 2006
Jim Womack, president of Brookline, Mass.-based Lean Enterprise Institute, wants to set the record straight about a recent Wall Street Journal report that stated, "Just-In-Time Inventories Make U.S. Vulnerable to a Pandemic." The idea behind JIT, ...

Jim Womack, president of Brookline, Mass.-based Lean Enterprise Institute, wants to set the record straight about a recent Wall Street Journal report that stated, "Just-In-Time Inventories Make U.S. Vulnerable to a Pandemic."

The idea behind JIT, Womack explains, "is to replace complex scheduling systems -- depending on centralized accumulation of information and complicated formulae -- with simple, intuitive systems that work much better while dramatically reducing the amount of inventories along a value stream." This inventory system includes; buffer stock, which is kept to address sudden spikes in demand; safety stock that is maintained to protect again supplier failure and shipping stock.

What is needed in cases of pandemics, according to Womack, are emergency stocks. This type of stock is separate from regular inventory categories and should be held under government control. By their very nature, these inventories must be dealt with outside the framework of JIT, insists Womack.

"The key point to note is that with emergency stocks in place, as we should all hope they will be, JIT works just fine. It helps production systems deal with "normal" variations in commercial demand at the lowest cost with the highest quality with maximum responsiveness to the customer's desire. Indeed, the cost savings from JIT -- which we've only started to achieve across the entire economy -- are a good way for society to afford the cost of emergency stocks."

Lean Enterprise Institute

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