Wednesday, June 6, 2012

Working Smarter: Is Just-in-Time for You?


As a training professional, I've had a lot to do with just-in-time training, the concept of providing training just before it is needed. The main benefit in training was that learners would learn something and then have an opportunity shortly thereafter to reinforce that learning by practising the activity. Far better than learning today and five weeks later struggling to recall what one had learnt.

While just-in-time is useful in training, there are also other applications that are highly suited for application in businesses. Two occasions that come to mind are these:

Payment of Accounts

When paying one's bills, there is no advantage in paying them before the due date. You earn interest on your account balance, which is often calculated on daily balances. When you pay an account early, you reduce the balance of your account and maybe lose the interest benefit.

Now I can hear you saying, "But the interest lost is peanuts, isn't it?"
It very well could be ... for one transaction of a small amount. But if yours is a business with a high cashflow and a lot of expenditure, it could add up to thousands or hundreds of dollars annually.

Just-in-time also means paying your accounts in time to get offers of discounts or avoid penalties for late payment. For example, Telstra, the main communications and information technology company in Australia has a $15 late fee for customers paying their bills after the due date.

Purchase of Consumables

Purchasing consumables just-in-time often means you don't need to have stocks sitting about taking up space, risking shrinkage (a kind accounting term for theft), or spoiling from water leaks, dust, impact etc.

Say for example your firm uses 20 reams of paper per month consistently, month in, month out. You may be able to have 20 reams dropped off monthly instead of storing large supplies somewhere in your office. Provided it doesn't have a higher cost, it could be well worthwhile implementing.

Can you think of other things to which the just-in-time concept can be applied to in businesses?

Robin

1 comment:

  1. I wonder whether you could have JIT maintenance. Probably not.

    ReplyDelete

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