The idea of Just In Time originated in Japan. Actually this type of inventory/production was originally known as the "Toyota Production System". A man by the name of Taiichi Ohno is credited as the person who first came up with this system. He looked at the Western industries and found that the manufacturers would set up their manufacturing lines to produce a large quantity of one product before stopping and and switching to a different product. They also would order and stock an overabundance of inventory so that the right parts were always on hand.Ohno did not feel that this would not work in a nation that demanded a smaller quantity but a greater variety to its products. So he came up with an innovative system of production that was based on the idea of eliminating waste. This system eliminated waste by only have items brought to the production line in the amount they needed and only when needed. He also came up with a system that used more machines than people. People were used only when the machines detected an error and then the system would stop until the problem had been corrected. This system is known now as automation. In this system having too much stock was seen as being a waste.A number of things that contribute to waste include:overproduction - waste from producing more than is needed time spent waiting - waste such as that associated with a worker being idle whilst waiting for another worker to pass him an item he needs (e.g. such as may occur in a sequential line production process) transportation/movement - waste such as that associated with transporting/moving items around a factory processing time - waste such as that associated with spending more time than is necessary processing an item on a machine inventory - waste associated with keeping stocks defects - waste associated with defective items At the time car prices in the USA where typically set using selling price = cost plus profit mark-up. However ...
