[Abbreviations] Procurement Just-in-Time (JIT)

Just-in-Time (JIT) in procurement activities, outlining key criteria, benefits, risks, and implementation steps:

JIT Procurement Matrix

(Focused on automotive/manufacturing supply chains)

Criteria	JIT Implementation	Benefits	Risks & Mitigations	Automotive Example
Supplier Relationship	- Long-term contracts with trusted suppliers. - Collaborative forecasting (VMI).	Reduced lead times, lower inventory costs.	Risk: Supplier failure. Mitigation: Dual sourcing.	Toyota’s partnership with Denso.
Lead Time Accuracy	- Real-time tracking (EDI, IoT). - Milk-run deliveries.	Minimizes stockouts/overstocking.	Risk: Transport delays. Mitigation: Buffer stock for critical parts.	Honda’s regional logistics hubs.
Quality Consistency	- Supplier certification (IATF 16949). - Incoming inspection waivers (for certified suppliers).	Zero-defect materials.	Risk: Quality escapes. Mitigation: Statistical sampling.	Bosch’s JIT deliveries to BMW.
Demand Stability	- Kanban/pull signals. - Shared production schedules (ERP integration).	Aligns supply with production needs.	Risk: Demand spikes. Mitigation: Flexible capacity agreements.	Tesla’s daily parts replenishment.
Cost Efficiency	- Bulk discounts waived for frequent small batches. - Reduced warehousing costs.	Lower carrying costs.	Risk: Higher per-unit transport costs. Mitigation: Consolidated shipments.	Ford’s JIT for assembly line seats.

Key JIT Procurement Activities

1. Supplier Selection

   • Criteria: Geographic proximity, proven reliability, IATF 16949 certification.

   • Tool: Supplier scorecards (OTIF, PPM).

2. Order Scheduling

   • Method: Kanban cards, electronic pull signals (ERP/MES).

   • Frequency: Hourly/daily (vs. weekly/monthly).

3. Delivery Execution

   • Mode: Milk runs, cross-docking, sequenced deliveries.

   • Tech: RFID/EDI for real-time tracking.

4. Inventory Control

   • Target: Near-zero raw material inventory.

   • Tool: ABC analysis (prioritize high-value parts).

JIT vs. Traditional Procurement

Factor	JIT Procurement	Traditional Procurement
Order Quantity	Small, frequent orders.	Large, infrequent orders.
Inventory	Minimal (days/hours of supply).	High (weeks/months of supply).
Supplier Role	Strategic partner.	Transactional vendor.
Flexibility	High (adapts to demand changes).	Low (rigid schedules).

Risks & Mitigations

Risk	Mitigation Strategy
Supply Chain Disruption	Dual sourcing, safety stock for critical items.
Quality Failures	Supplier audits, inbound quality gates.
Demand Volatility	Demand sensing tools (AI forecasting).

Automotive Best Practices

1. Toyota Production System (TPS):

   • Heijunka (production leveling) + Kanban for JIT parts flow.

2. Tesla:

   • Gigafactory co-location with suppliers (e.g., Panasonic for batteries).

3. Volkswagen:

   • Modular Consortiums: Suppliers assemble modules on-site (e.g., seats, dashboards).

Implementation Checklist

1. Map all parts to JIT feasibility (ABC analysis).

2. Negotiate VMI (Vendor-Managed Inventory) agreements.

3. Integrate ERP with supplier systems (EDI/API).

4. Train staff on Kanban/pull systems.

5. Pilot JIT with 1-2 high-volume suppliers.

Performance Metrics

KPI	Target	Measurement Tool
Inventory Turns	≥12/year	ERP reports.
OTIF (On-Time In-Full)	≥98%	Supplier scorecards.
Lead Time	≤24 hours for critical parts	IoT/EDI tracking.

Abbreviations with their full forms, associated records/forms, and intended results, optimized for automotive/quality management contexts:

Abbreviation Matrix for Automotive Quality & Procurement

Abbr.	Full Form	Record/Form	Intended Result
JIT	Just-in-Time	JIT Delivery Schedules, Kanban Cards	Minimized inventory, reduced waste, on-time production.
VMI	Vendor-Managed Inventory	VMI Agreements, Stock-Level Reports	Supplier monitors/restocks inventory, reducing buyer workload.
EDI	Electronic Data Interchange	EDI Transaction Logs (e.g., PO/ASN)	Automated, error-free order processing.
OTIF	On-Time In-Full	OTIF Scorecards, Delivery Reports	Reliable supplier performance (e.g., ≥98% compliance).
PPM	Parts Per Million	Defect Logs, Quality Reports	Tracks defect rates (e.g., reduced from 500 PPM to 50 PPM).
COC	Certificate of Conformance	COC Documents (Per Batch)	Ensures materials meet specs (IATF 16949 Clause 8.6.4).
GR&R	Gage Repeatability & Reproducibility	MSA Reports, Calibration Records	Valid measurement systems (GR&R ≤10% for critical dimensions).
FIFO	First-In-First-Out	FIFO Audit Checklists, Storage Labels	Prevents material obsolescence/expiry.
MOQ	Minimum Order Quantity	Supplier Contracts, Purchase Orders	Balances cost efficiency with JIT needs.
ERP	Enterprise Resource Planning	ERP System Logs (SAP/Oracle)	Real-time inventory/production tracking.
RFQ	Request for Quotation	RFQ Documents, Supplier Bids	Competitive pricing, qualified supplier selection.
SLA	Service Level Agreement	SLA Contracts, Performance Dashboards	Defines supplier response times, penalties for delays.
RMA	Return Material Authorization	RMA Forms, Non-Conformance Reports	Streamlines defective material returns/credits.
BOM	Bill of Materials	BOM Sheets (Engineering/Production)	Accurate part lists for procurement/production.
OEE	Overall Equipment Effectiveness	OEE Dashboards, Downtime Logs	Measures production efficiency (e.g., OEE ≥85%).

Key to Records & Results

Category	Example Records	Intended Outcome
Procurement	JIT Schedules, VMI Agreements	Reduced inventory costs, on-time deliveries.
Quality	MSA Reports, PPM Logs	Zero defects, compliance with IATF 16949.
Operations	OEE Dashboards, FIFO Audits	Higher productivity, no material waste.
Supplier Mgmt.	OTIF Scorecards, SLA Contracts	Reliable supply chain, minimized disruptions.

Implementation Tips

1. JIT/VMI: Start with high-volume, predictable parts (e.g., fasteners, packaging).

2. EDI/ERP: Integrate with Tier 1 suppliers first for seamless data flow.

3. PPM/OEE: Track weekly to identify trends and trigger CAPAs.

Automotive Examples

• Toyota: Uses JIT + Kanban to achieve <2 hours of inventory for some parts.

• Tesla: VMI with Panasonic for battery cells (real-time stock updates via EDI).

• Ford: OTIF targets of 99% for critical suppliers (e.g., brake components).

Need template links (e.g., SLA contracts, MSA forms) or sector-specific