Insights: Is Just-in-Time Inventory Dead?
September 2024 manufacturing & warehousing
For decades, manufacturers have optimized inventory using the concept of just-in-time inventory. This concept allows companies only keep enough stock on hand to meet immediate production needs or customer demand. The goal is to minimize holding costs and reduce waste by receiving goods only as they are needed in the production process.
Because JIT requires precise coordination with suppliers, it’s vulnerable to disruptions, which has become glaringly apparent the last four years. What’s changed in the JIT landscape?
Inbound Logistics: Is Just-in-Time Dead?
In a recent edition, Inbound Logistics posed this question to logistics leaders – and got a definite answer of “sort of.”
While the JIT concept isn’t dead, the answers seemed to focus on the flaws of JIT in today’s logistics and industrial economies. Its current reality may be very different than in 2019, when international, multi-step supply chains were more reliable…or perceived to be more reliable.
Readers mentioned that hybrid models that focus on agile management with inventory buffers deliver many of the benefits without the natural flaws.
“Precise timing,” said one reader, “makes supply chains vulnerable to disruption.” This causes production delays that aren’t tolerable today. Others mention the over-reliance on China and other nations that give them effective control of American production in a strict JIT inventory strategy.
JIT systems have been prevalent for decades as manufacturers optimized supply chains for cost and flexibility. Stock on hand was scant, so that it was only inducted when needed. Gone were the days of vast warehouses full of inventory. The problem? This reduced reliability. When the Covid pandemic occurred, the system’s flaws where apparent.Â
What are the tradeoffs?
- JIT systems improve cashflow, but restrict customer service when the needed parts aren’t in stock and can’t be quickly acquired.
- It’s arguable that just-in-time offers better flexibility. It does when the system works, but gums up when you can’t acquire stock as you need it.
- The system is extremely vulnerable to supply chain disruptions. These can range from material shortages to international incidents or political/trade wars between countries in your supply chain.
- If prices radically change, you may experience price shocks that would be reduced by stock purchased when costs were lower.
“Super-strict JIT,” said another reader, “is dead. We need more flexibility with extra stock on hand to handle unexpected bumps in the road.”
More: the state of just-in-time
- Harvard Business Review: Don’t Abandon Your Just-In-Time Supply Chain, Revamp It
- Oracle breaks down the advantages and disadvantages of just-in-time
- Did the pandemic really kill just-in-time? Experts weigh in – Supply Chain Dive
Premier Tech: Choosing the Right End-effector
Installing a palletizer involves many decisions, but one of the first should be the end-of-arm tooling. Premier Tech lays out the options and provides guidance on when you should utilize them. The end effector handles your loads – whether bags, cartons, bundles, components or others.
Where to start
Consider your product, how it’s built, what it weighs and how it should be handled. Is it a bundle? A case or carton? What’s it made of? What does it weigh? Are there multiple products on the same line or in the same process? All products will likely need to be handled differently than others. At times, you can swap end effectors for different production cycles that send the robot a different product.
Factors like space also come into focus. Can the palletizer fit into the space you have available? Will it require you to reconfigure other areas? How will it affect upstream and downstream functions?
End effector options
- Vacuum grippers: excellent for products that cannot be clamped. This tends to be products that aren’t rigid, or are picked from areas with little space. These effectors are sensitive to dust and debris, and the surface areas of the product being handled.
- Layer grippers: These grippers don’t handle the product directly. They use servo-driven rollers to gently grip the product opposite sides.
- Clamp grips: These are often called bundle grippers, as that’s a prime application for them. They’re ideal for slip-top cartons and heavy applications.
- Pail grippers: Grasps the top of pails to lift and maneuver them.
- Fork gripper: Also called a lateral finger gripper, ideal for open-top containers or oversized bags. This extremely flexible option is good for products that must be picked up from the bottom.
- Servo-controlled grippers: These “jaws” are controlled by electric input from the robot controller. They don’t require air lines.
- Finger grippers: This hybrid of clamp and fork grippers holds the load from the sides in a very secure grip that is good for fragile items that require extra support.
- Magnetic grippers: Used for metal products (those made of ferrous materials), like cans or other metal loads. You may be able to grip a full layer of products with a magnetic gripper.
- Ring grippers: These grippers are frequently used for drums and barrels by closing around them for handling.
- Pallet and slip sheet grippers: This type of gripper are integrated into pallet and slip sheet handling applications.
- Custom grippers: Many product and handling applications aren’t covered by standard options, so grippers must be customized.
Forbes: Blue Collar Workers Wanted—1.7 Million New Jobs Projected By 2032
Demographics and worldwide trends are reshaping our economy, and one of the clear trends is that blue collar jobs – the kind needed for warehouses and factories – are both on the rise and experiencing worker shortages. By 2032, according to Forbes, over 35% of the fastest growing jobs are blue collar. At the same time, The National Association of Manufacturers projects a 2.1 million worker shortfall by 2030.
Warehouse operators must adapt recruitment and retention policies to the shrinking and changing pool of warehouse labor. Cisco-Eagle’s Jessica Haring covers some of these methods in Give Me a Reason to Stay
Manufacturers are working to deal with the shortages today, but struggle to fill higher paying, entry-level positions. This article focuses on the things younger workers can do to become higher-skilled, higher-earning in their blue-collar careers.
Quick hits
- In the nightmare scenario of a cyberattack or ransomware problem, it’s not only tech and office work that’s at risk. Companies rely on information systems to drive and direct distribution and manufacturing operations. Industry Today lays out strategies to help modernize continuity plans in these instances in 4 Ways to Build Resilience in the Face of Tech Outages.
- In “Today’s Pallets: Leaders of the Stack”, Inbound Logistics discusses the need for strategic approaches to pallet management. Some industries – particularly food and pharmaceutical are moving away from traditional wood pallets. Others are focused on pallets suitable for automation. One discussion is of weight: at scale, the heavier the pallet, the more strain on storage and transport costs. All of this should be considered when pallets are used at scale in your operation.
Scott Stone is Cisco-Eagle's Vice President of Marketing with more than thirty years of experience in material handling, warehousing and industrial operations. His work is published in multiple industry journals an websites on a variety of warehousing topics. He writes about automation, warehousing, safety, manufacturing and other areas of concern for industrial operations and those who operate them.