Just in Time (JIT) Analysis
Just in Time (JIT) is a philosophy that defines how a business develops its supply chain strategies. A company’s JIT philosophy influences its relationships with its suppliers, customers, and employees. In its simplest form, JIT means getting the right amount of goods in the right place at the right time (Reid and Sanders, 2016). It aims to maximize production volume while minimizing waste and maintaining continuous improvement. Zara employs various strategies that contribute to its JIT philosophy. This paper seeks to perform a JIT analysis and evaluate the Zara supply chain management.
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Zara’s Use of JIT
Zara’s operations are managed in a lean production system based on the concepts of the JIT philosophy. The company has developed a controlled and integrated operations process that enables them to minimize waste in the production process. The company’s primary focus in its production is on the teams that do the actual production and quality management. The company designs and produces all its products internally. The design is based on customer preferences and trends at a given time. Hence, the design and production process involves team effort with the designers, market specialists, procurement, and production teams. It uses several strategies in the manufacturing process to ensure that the products are delivered to the customers just in time.
First, the company integrates the entire supply chain with the help of information technology. The communication and internet systems, such as the company’s website and the internal information systems for the employees, ensure that all the critical stakeholders are connected. Through these systems, the company collects information on the customers. They check data on the sales trends and fashion trends required at a given time. With this information, the company can ascertain the types of products demanded in the market and estimate the quantities they can sell. As a result, the company can produce the right amounts of clothing on average to minimize wastage through surplus production. The market data also enables them to make the type of quality demanded in the market. Zara also minimizes waste and ensures quality through a specific production process. The production process uses the same techniques to ensure minimal development of product defects. The company can maintain quality at a maximum level with minimal defective products while minimizing wastage.
Supply Chain Management
Zara has also developed some supply chain management strategies to support its JIT production philosophy. Supply chain management is a vital business function that coordinates all the activities in the supply chain (Christopher, 2016). Supply chain management activities correspond to the movement of goods from the suppliers to the manufacturers, then to the distributors and the consumers.
The first step of the Zara supply chain is sourcing raw materials. The primary raw materials for the company are the fabrics used for making fashion designs. Zara sources for its suppliers strategically to ensure that it acquires the best quality but cost-effective fabrics. To achieve this, the company has external suppliers. With external suppliers, Zara can evaluate various options for the best possible rate.
Regarding production, the company has set up its manufacturing plants. Zara has thousands of manufacturing plants located in various parts of the world. However, these plants are mainly located in regions where labor costs are minimized to reduce production costs. The many manufacturing plants allow the company to meet the high demand for new products every few months when a new fashion season emerges. Every season, the company frees up to 80% of its production plants to facilitate the production of the latest fashion. For distribution, the company has formed supply chain relationships with distributors who ensure the products are delivered to tens of thousands of stores in time. Lastly, Zara uses various strategies to retail its products to customers. The three min retailing strategies that the company uses include franchising, its retail stores, and e-commerce. Zara offers franchise opportunities for businesspeople wanting to operate its business model. It also has its retail stores that the company wholly owns. Most importantly, the company has embraced the recent development of online businesses. Zara has online stores where buyers from almost all countries can purchase the products.
Effective management of the supply chain is essential for a business’s success. A company must ensure the smooth movement of products from the suppliers to the customers. Zara uses a JIT philosophy to ensure that the right supplies are available to consumers in time. The company minimizes waste and maintains the best possible quality at a given time.
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Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Reid, R. D., & Sanders, N. R. (2016). Operations Management, Binder Ready Version: An Integrated Approach. John Wiley & Sons.
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[u05a2] Unit 5 Assignment 2 Project – Just in Time JIT Analysis
Part four of your course project focuses on analanalyzescompany’s use of JI and supply chain management.
For more information on JIT and Supply Chain Management, refer to Chapters 4 and 7 in your textbook. Your submission should be approximately three pages and should be submitted as an attachment to this assignment.
Project – JIT Analysis Scoring Guide
Due Date: Unit 5
Percentage of Course Grade: 5%.
|Describe how a company receives components and materials for a product or service.
|Describes how a company receives components and materials for a product or service and how they are integrated into the production and business processes.|
|Describe a company’s alliances or partnerships with other companies and how they are integrated into the production process.
|Analyzes alliances or partnerships a company has with other companies and how they are integrated into the production and business processes.|
|Analyze JIT programs currently in use or indicate no JIT programs are in use and analyze how they could be used.
|Analyzes JIT programs currently in use, including their effectiveness, or indicate no JIT programs are in use and explore how they could be effectively used, including specific, relevant examples.|
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