Just-in-time

In this lesson

1. 0:00 Just in time inventory management explained
2. 0:08 What just in time actually means
3. 0:23 Key benefits and efficiency gains
4. 0:55 Supply chain requirements for JIT
5. 1:11 JIT objectives and waste elimination
6. 1:56 JIT procurement versus JIT production
7. 2:40 Working capital and business risks
8. 3:19 When JIT isn't appropriate

About this lesson

This is essential knowledge for Performance Management and Advanced Performance Management papers, where understanding operational efficiency and cost control directly impacts your exam performance. Just-in-time means obtaining and producing materials only as they're needed, eliminating unnecessary inventory holding. The approach works through two distinct strategies: just-in-time procurement, where you source from suppliers at the latest possible moment, and just-in-time production, where you manufacture only when customer orders arrive. Both reduce holding costs, manufacturing lead times, and labour inefficiency by removing waste throughout the production process. However, just-in-time isn't suitable for every business. It requires a strong, reliable supply chain to operate effectively. Industries where demand is unpredictable—like hospitals—or where stock availability is business-critical should avoid this approach, as supply chain disruptions could damage customer relationships and reputation. Understanding these limitations is just as important as knowing the benefits when applying this concept to case study scenarios.

Duration: 4m