Transition to a JIT production system through ERP implementation: a case from the automotive industry

Abstract

ERP systems provide important benefits to institutions, such as improved processes, improved data, supplier–customer integration, better planning and control, as well as real-time insight and just-in-time (JIT) management that can put a business organisation in front of the competition. In this study, the change and transformation experienced by establishing an ERP system are explained for an automotive supplier that was not using an integrated ERP system for a real-world problem. The pre-implementation situation, the problems of the existing system, the necessary reasons for such an application, the determined deficiencies of the installed system and the post-implementation situation are explained in detail. Thanks to the real-time information and integrated data generated by the reports, along with a more sophisticated business understanding, the risk to employees was lowered. As a result of a changeover to real-time Materials Requirement Planning, the decrease in inventory levels, stabilisation in delivery time and efficiency of control over the production processes were increased in addition to real-time tracking and reporting advantages. As a result of this work, the production processes were transformed into JIT. The inventory level was reduced to zero and a formerly used warehouse was no longer required.