Total system JIT outcomes: inventory, organization and financial effects

Abstract

Despite anecdotal evidence of the performance implications of just‐in‐time (JIT) implementation, little empirical research has been conducted. Examines total system JIT’s empirical relationships with a variety of performance outcomes. Total system JIT encompasses JIT purchasing, JIT production, and JIT selling. In a mail survey of 200 logistics executives, total system JIT was found to be: inversely related to weeks of inventory (inclusive of inbound, in‐process, and outbound); inversely related to the number of layers in various functional areas (e.g. marketing); and positively related to three different indicators of financial performance (ROI, profits, and ROS). Results, managerial implications, and further research are discussed.