Shifting the blame for shortages to JIT is a pretty lazy rhetorical trick. Even if they had 3 months, 6 months, or 12 months inventory, they would still be under fire for not withstanding an 18 month market upheaval. Were businesses not planning conservatively enough? Probably. But risk tolerance is not an on/off switch.
Furthermore, this article completely misses the entire point of Just In Time. Sure, you save time and money on inventory. That's just peanuts. The main purpose is to eliminate manufacturing defects early.
If you are running a 3 month backstock of inventory, it will take 3 months for improvements to show up in the assembly line. Multiply this across several levels of assembly, and it ended up being more cost effective to slap poorly built pieces together with some expensive hand finishing than to improve anything. Or, worse case scenario, you have to toss out the entire inventory and start again. (I've heard a few stories from Tesla where this was a pretty common occurrence).
And it's not like JIT actually slows manufacturing! You are literally making the same amount of products! With less waste! So blaming manufacturers for not making enough in a shortage because they made it all too quickly beforehand is, frankly, a dumb way of looking at the problem.
Just In Time has led to much, much higher quality products that last a lot longer with less waste. Even in a shortage of new cars, affordable cars that regularly exceed 300k miles is worth the tradeoff. Another way to look at it is we are trading the manufacturers' ability to withstand a shortage for the customers'.
I haven’t read the article but I find the hyperbolic headline pretty distasteful.
Some countries are experiencing degraded supply chain performance which impacts affordability of goods, and availability as well. The arbitrary, instant gratification SLA that some have come to expect is showing cracks but we certainly haven’t run out of everything.
Furthermore, this article completely misses the entire point of Just In Time. Sure, you save time and money on inventory. That's just peanuts. The main purpose is to eliminate manufacturing defects early.
If you are running a 3 month backstock of inventory, it will take 3 months for improvements to show up in the assembly line. Multiply this across several levels of assembly, and it ended up being more cost effective to slap poorly built pieces together with some expensive hand finishing than to improve anything. Or, worse case scenario, you have to toss out the entire inventory and start again. (I've heard a few stories from Tesla where this was a pretty common occurrence).
And it's not like JIT actually slows manufacturing! You are literally making the same amount of products! With less waste! So blaming manufacturers for not making enough in a shortage because they made it all too quickly beforehand is, frankly, a dumb way of looking at the problem.
Just In Time has led to much, much higher quality products that last a lot longer with less waste. Even in a shortage of new cars, affordable cars that regularly exceed 300k miles is worth the tradeoff. Another way to look at it is we are trading the manufacturers' ability to withstand a shortage for the customers'.