THE STUDY OF JUST-IN-TIME INVENTORY

MANAGEMENT

A MINI PROJECT REPORT

Submitted

In Partial Fulfilment of the Requirement

For the Degree of

MASTER OF BUSINESS ADMINISTRATION

In

OPERATIONS MANAGEMENT
By

SHUBHAM BHARDWAJ
Under the Supervision of

DR. SWATI SRIVASTAVA

Department of Business Administration

U.P. INSTITUTE OF DESIGN, NOIDA

Dr. APJ ABDUL KALAM TECHNICAL UNIVERSITY,
LUCKNOW
2021
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 CERTIFICATE

TO WHOM IT MAY CONCERN

This is to certify that SHUBHAM BHARDWAJ, student of MASTERS IN

BUSINESS ADMINISTRATION in U.P. Institute of Design, Noida has successfully
completed her project work entitled "TO STUDY JUST-IN-TIME INVENTORY
MANAGEMENT" for the partial fulfillment of degree. The project report embodies
the result of original work, secondary data collected from various sources and studies
as are carried out by the student herself and the content of the project do not form the
basis for the award to the candidate or to anybody else from this or any other
university.

Dr. Swati Srivastava

Department of Business Administration

Date:

DECLARATION

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I hereby declare that the project work entitled “TO STUDY JUST-IN-TIME
INVENTORY MANAGEMENT” submitted to MBA department of U.P.
Institute of Design Noida is a record of an original work done by me under
the guidance of Dr. Swati Srivastava, Faculty Member, U.P. Institute of
Design Noida, and this project work has not formed the basis for the award of
any degree, associate ship, fellowship or any other similar titles.

SHUBHAM BHARDWAJ

MBA (2nd Semester)

ACKNOWLEDGEMENT

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"I have taken efforts in this project. However, it would not have been possible
without the kind support and help of many individuals. I would like to extend
my sincere thanks to all of them.

I am highly indebted to Dr. Swati Srivastava for their guidance and constant
supervision as well as for providing necessary information regarding the
project & also for their support in completing the project. I would like to
express my gratitude towards all the faculty and staff members of U.P.
Institute of Design, Noida for their kind co-operation and encouragement
which help me in completion of this project.

THANK YOU

SHUBHAM
BHARDWAJ

INDEX
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S. No. TOPICS PAGENO.

1 DECLARATION 3

2 ACKNOWLEDGEMENT 4

3 INTRODUCTION 6-15

4 COMPANY PROFILE 16-24

5 EMERGING TECHNOLOGY USED 25-29

6 LITERATURE REVIEW 30-32

7 OBJECTIVES OF THE STUDY 33

8 RESEARCH METHODOLOGY 34-35

9 CASE STUDY 36-46

10 FINDINGS 47

11 CONCLUSION 48-49

12 SUGGESTIONS &LIMITATIONS 50

13 BIBILIOGRAPHY 51

14 ANNEXURE 52

INTRODUCTION

Inventory management and supply-chain are the foundation of any business

activities. With the advancement of innovation and accessibility of interaction driven
programming applications, inventory management has gone through progressive
changes. In any business or association, all capacities are interlinked and associated
with one another and are regularly covering. Some key angles like production

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 network, the executives, coordination and stock structure are foundation of the
business conveyance work. Thusly these capacities are critical to promoting directors
just as money regulators.

Inventory management is a vital capacity that decides the strength of the production
network just as the effects the monetary wellbeing of the accounting report. Each
association continually endeavors to keep up ideal stock to have the option to meet
its necessities and stay away from over or under stock that can affect the monetary
figures.

Stock is consistently unique. Inventory management requires steady and cautious

assessment of outside and interior factors and control through arranging and audit.
The majority of the associations have a different division or occupation work called
stock organizers who consistently screen, control and survey stock and interface with
creation, acquisition and money offices.

Over the most recent thirty years, different ventures on the planet have gone through
enormous changes. This has brought about exceptional changes in administration
approach, strategies utilized underway and cycle, mentalities of provider, cutthroat
conduct and assumptions for client.

Inventories that are put away in huge amounts bring about space utilization and waste.
Endurance of organizations in the quick changing worldwide commercial center relies
exclusively upon having the option to convey great quality items at a less expensive
rate. Quality improvement and costs control are significant for satisfying clients'
prerequisites and accomplishing the objective of work execution upgrade. Economies
of scale and interior specialization are pivotal for accomplishing upper hand.

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 Fig; JUST IN TIME INVENTORY

Just in time (JIT) is a significant automatic activities improvement idea that has
changed the manner in which assembling firms deal with their tasks. It underscores
on killing waste and expanding usefulness. It’s essential components are to have just
that stock which is required; to decrease lead times by diminishing part estimates,
arrangement times and line lengths; to augment the quality by cutting down the
imperfections to nothing; and to limit cost. It will likely streamline methodology and
cycles by persistently seeking after squander decrease.

Just-in-time, which is also known as the JIT is an inventory management technique

in which the work, materials and goods used in the production is to be topped up, or
is planned to arrive at the precise moment when that will be needed in the production
process.

The Just-in-time approach is to be able to apply them in an organization can

significantly increase the organization's competitive position in the market due to the
minimization of waste and the improvement of the production efficiency and the
quality of the product.

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HISTORY OF JIT

JIT is a manufacturing process. It was originally designed and implemented at the

Toyota plant in order to meet the specific needs of the client, with a minimum of
delay.

Taiichi ono of Japan is called the father of the Just-In-Time. Toyota has been able to
meet the demands of the movie, through a management approach that is focused
entirely on the people, systems, and industrial plants.

Toyota and I have come to realize that it is "Just-in-Time" approach will only be
effective if everyone at Toyota is committed to be involved, and as for the plants,
and the processes are well-organized to maximize efficiency and productivity, as
well as the quality of the products produced and the production of the programmes
will be tailored exactly to the requirements.

SIGNIFICANCE OF JIT

The main goal of JIT is to identify and eliminate barriers in the process. This will
show the hidden supply of problems. The main goal of JIT is to increase the revenue,
and the reduction of the road, the cost and any and all associated costs.

The Just-In-Time ' method doesn't allow the use of surplus stocks, and smooth
production operations, if the job takes longer than expected to complete, or of a part
of a fault has been detected in the system. This is one of the main reasons why
companies invest in the maintenance part, or a piece of equipment breaks down, the
whole process stops.

The approach has been applied by the Japanese companies, placing an order for the
material on the same day of the production. The just-in-time approach eliminates the
requirement to hold voluminous inventories and incur heavy carrying other related
costs to the manufacturer.

The use of the services, the Just-in-time system, and an optimum matching of the
production cycle as well as the material supply needs to be ensured. Just-In-Time is
required for a better understanding of the supplier and the manufacturer, in terms of
the quantity and the delivery of the material. In the case of a misunderstanding

8
between the manufacturer and the supplier of that material, the production process is
able to stop it.

An example of a Just-in-time system in an automobile, an automotive manufacturer,

to work with a minimum of supplies, there is a strong reliance on services, the
provision of the spare parts which are needed for the production of the cars. The
parts that are needed to produce the car, not before or after they are used; that is, they
do only when they are needed.

A successful Just-in-time implementation, it is totally depending on the manufacturer

and the management of suppliers. There is a lot of pressure on them, and because the
suppliers of the materials to be prepared by the proper quality of the materials, such
as, for example, a demand will be created.

ELEMENTS INVOLVED IN JIT

1. Continuous improvement:
• Attacking basic problems and anything that does not add value to the product.
• Developing strategies to identify productivity and related problems.
• Simplification: Simple systems are simple and easy to understand, easily
controlled and the chances of failure are very low.
• A structure designed for the product with less time spent on materials and
movement of parts.
• Source quality control to ensure that every employee is solely responsible for
the quality of his or her product made.
2. Eliminating Waste: There are seven types of waste:
• Waste from product errors.
• Waste of time.
• Transport waste.
• Waste disposal.
• Waste from overproduction.
• Waste processing.

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Waste minimization is one of the main goals of the Just In Time program. This
requires effective asset management throughout the supply chain.

Initially, a manufacturing business will want to reduce inventories and improve

performance in its organization. In an effort to reduce waste caused by ineffective
asset management, six principles in terms of JIT have been stated by Schniededans
and are as follows:

• Reduce temporary inventory.

• Try to get zero
• Search for trusted providers.
• Reduce the size and increase the frequency of orders.
• Reduce purchase costs.
• Improve inventory management.

ADVANTAGES AND DISADVANTAGES OF JUST-IN-TIME SYSTEMS

The advantages of Just-In-Time include:

• The timely entry method keeps the cost of holding the stock low. The amount
issued leads to better utilization of space and has a positive impact on
insurance premiums and rent that would otherwise need to be made.
• A timely relief plan helps eliminate waste. Chances of expiration or product
expiration; don't wake up at all.
• As under this management approach, only significant stocks required for
production are available, so minimal operating costs are required.
• Under this method, a lower re-order rate is set, and only when that level has
been reached, new stock purchases are made and therefore this is beneficial
to asset management.
• Due to the low level of stocks held above, the ROI (Return On Investment) of
organizations is generally higher.
• As this method works with deductible demand, all manufactured goods will
be sold, and thus incorporates changes in unexpected demands. This makes
JIT attractive today, when market demand is consistent and volatile.

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 • JIT emphasizes the concept of 'first time', so that repetitive costs and test
costs are reduced.
• Following JIT high efficiency and high quality products can be obtained.
• Better relationships are encouraged in the production chain under the JIT
program.
• High customer satisfaction due to continuous customer contact.
• Just-In-Time adoption results in the removal of overproduction.

The disadvantages of obtaining JIT Systems

The JIT method states zero tolerance of errors, which makes recycling difficult to
operate, as imports are kept to a minimum.

• Successful use of JIT requires high reliability of suppliers, their performance

outside the manufacturer's view.
• Due to the lack of buffers in JIT, production line production and downtime
are likely to have a negative impact on the production process and finances.
• Very high risk of non-compliance with unforeseen increases in orders as
there will be no over-enumeration of finished goods.
• Work costs can be high compared to the number of jobs.
• JIT may have some adverse environmental effects due to frequent deliveries
as the same can lead to high consumption and travel costs, which can also
consume a lot of fuel.

INVENTORY MANAGEMENT TECHNIQUES AND RATIOS

There are a variety of inventory management techniques that can lead to effective
inventory management. They are as follows:

1. ABC Analysis:

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ABC analysis is a method of sorting items that are present in 3 categories. The
classification of inventory under ABC analysis is done based on how the inventory
can sell and how much it will cost to hold. The Always Better Control technique
(ABC) analysis divides the list into three categories namely: A, B, and C.

This innovative management approach helps an organization to keep operating costs

low because it identifies linear items that need to be redesigned more often and do not
require more maintenance. The results of expired assets and increasing the rate of
inventory profit.

2. JIT Method:

Just-in-time is a Japanese method of asset management, in this process the company

retains the same amount of innovation as it needs during the production / production
process. It means that there is no excessive use on hand and saves on storage costs,
shipping, insurance and other related expenses. Additional collections in orders when

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old stock is close enough to be replenished. However, this is a slightly risky
management approach because a slight delay can lead to a loss of sales that may not
be possible. This approach therefore requires good planning, efficient supplier and
timely delivery of goods so that new orders can be placed on time.

3. Safety Stock Inventory

This method of emphasizing keeping a small stock of goods in hand to protect against
any unexpected market demands and the time difference between the start and end of
the production process (lead time). This innovative management approach plays an
important role in the smooth operation of the supply chain in a variety of ways. Like:

• Be aware of unexpected market needs

• Preventing stocks c. Compensate in the event of inaccurate market forecasts

Also the longevity of the lead times than expected without the security stock assets an
organization may receive:

• Lost customers
• Loss of income
• Loss of market share.

4. Material Resource Planning (MRP)

Material Resource Planning (MRP) is an innovative management approach. Under

this process, manufacturers / producers order inventory after checking the sales
forecast. The Material Requirement Plan (MRP) incorporates data from various
business areas where inventory is used. After looking at the data and market demand,
an order for new items is placed.

5. Drop Shipping

Pull-ups are business models, allowing for the sale and export of goods without
owning and maintaining them. This method of asset management eliminates the cost
of assets holding it all together. Shipping process is very simple:

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The following are the benefits of subtraction:

• Low start-up costs,

• Low cost of installation,
• Low cost of filling orders,
• Sell and test multiple products with minimal risk

6. Economic Order Quantity (EOQ) model

In this innovative management approach, a company focuses on a decision about how

much goods should be ordered and when an order should be placed. In this way,
inventory stock is re-ordered when we reach a minimum order level. This innovative
management approach saves shipping and order costs incurred during the ordering
process.

RATIOS

An inventory management measure is also called efficiency or a performance measure

indicates the return made on a particular type of asset using sales, cost and asset data.
This measure helps the business to identify the effective use of assets and thus
facilitates good management. The value of an asset is one of the most important
measurements of the asset management of a business that sells tangible assets.
Estimates related to the establishment are given below:

1. Inventory turnover ratio

Inventory turnover ratio is used to determine the rate at which a company's inventory
is converted into cash. A company with a high value of materials is considered an
effective marketing strategy. It is usually measured using the inventory period which
is the calculated by the average inventory divided by average cost of the goods sold.
A high inventory turnover ratio indicates efficient management of inventory and
goods are fast moving.

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2. Inventory Outstanding Days

Inventory outstanding days are the average number of days it takes for a company to
sell inventory. This is the number of days the stock has been stored in the warehouse
before being delivered to the customer.

3. Operating cycle

The operating cycle is the number of days a company takes to sell inventory, and
receive the money from the customers. This is termed as operating cycle, because it is
the process of acquiring goods and selling them and receive cash from the customers,
with the help of this money in order to buy the shares, and so on.

MARUTI SUZUKI

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Maruti Suzuki India Limited, formerly known as Maruti Udyog Limited, is a
subsidiary company of Japanese automaker Suzuki. The company was founded in and
was part of the Government of India, and from 1981 to 2003. It was sold to the
Government of India by the Suzuki Motor Corporation, 2003. As of July 2018, its
market share in the Indian passenger car market, there are 53 percent of the time.

Maruti Suzuki has been one of the leading automobile manufacturers in India, and
will be the automotive sector in terms of the number of vehicles sold, as well as the
sales. The company has been established in February 1981. However, the actual
production commenced in 1983 with the Maruti 800, based on the Japanese Suzuki
Alto, car and machine building, which was the only modern car available in India at
that time. Earlier, the Government of India has undertaken 18.28% of the outstanding
shares of the company owned by the Japanese Suzuki, and 54.2% of the Japanese
Suzuki. However, in June 2003, the Government of India, held an initial public
offering of 25% of the shares outstanding. On May 10, 2007 the company has
completely sold its stake in the Indian financial institutions.

In 2004, Maruti Suzuki has produced over 5 million vehicles. Now, the company has
an export of more than 50,000 cars annually and has a large domestic market in India
selling more than 730,000 cars annually. The Maruti 800 remains the India's largest
selling compact car in 2004, and since its inception in 1983. To date, there are more
than one million units of this car have been sold worldwide. Currently, Maruti Suzuki
Alto tops the sales list, and Maruti Suzuki Swift is the largest company in sales in the
A2 segment of the industry. More than half of the cars sold in India are Maruti
Maruti Suzukis are sold in India and other countries, depending on the export orders.
Models like the Maruti Suzukis (but not manufactured by Maruti Udyog) sold by the
Suzuki Motor Corporation and manufactured in Pakistan and other southern states of

16
the Asian countries. During 2007-08, Maruti Suzuki sold 764,842 vehicles, of which
53,024 were to be put on sale.
Since the release of first car on 14 December 1983, more than six million Maruti
Suzuki vehicles on the Indian roads alone.

Maruti Suzuki has two state-of-the-art manufacturing sites in India. The first item that
can be found at: what stretches over an area of over 300 hectares, while the other area
is, in itself, that extends over an area of more than 600 acres of land. In the Northern
part of India, the factory is located in Gurgaon Maruti Suzuki's plant in Gurgoan is
comprised of three full integrated units. While the total installed capacity of the three
plants is 350,000 vehicles per year, a number of improvements in productivity or in
the shop, instagram, over the years, have allowed the company produces nearly
700,000 vehicles per year, the gurgaon central mall and plants. The entire property is
equipped with more than 150 robots, and 71 were developed independently of one
another. For more than 50% of our staff are fully trained in Japan.

COMPANY PROFILE

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Mission Statement:

"To be The Leader in the Indian Automobile Industry, Creating Customer Delight
and Shareholder's Wealth; A pride of India"

The current version of the Suzuki logo is in red and blue color. The red color S Suzuki
is a symbol of passion, integrity, and tradition, and blue M, Maruti is the symbol
depicting perfection and grandeur.

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19
20
INVENTORY MANAGEMENT SYSTEM IN MARUTI SUZUKI

Suzuki came up with a brand new production of culture, which included participation
in management, teamwork, communication, and the sharing of information, open
office, Kaizen (continuous improvement) system, a multi-skilled operators, and a flat
hierarchy, and, above all, the concept of " just-in-time manufacturing. Many of them
were in India, is seen as being in a relationship with a Japanese production of culture,
but that Maruti was the first Indian company to which such practices have been
properly carried out, from the top to the bottom. The Maruti factory in Gurgaon, close
to Delhi, it can be a culture shock for the audience. No wet or oily stains, no chips, no
factories are scattered all over the floor, all of the tools, parts and equipment are in
place, sensors, dust, pipelines, no-leak liner, all in one place, there is no peeling of the
paint on the machine, the contours are clearly marked as such, good lighting, and a
clean atmosphere.

Maruti perform the task in a typical Japanese methodological function of Plan, Do,
Check and Act. At first, the top management fixes the common goals, which are then
sub-divided into elements, and these elements is developed in mini-projects that can
be realized. The eight typical wastages at each operational points (over-production,
human movement, material movement, idle time of operator, work-in-progress,
availability of machines, waiting time and unnecessary processing) measured by the
observation, and even videography. The bottlenecks have been identified, and much
of the work had been done to optimize the process. In 2005, near Maruti service 6,700
people, it is made of 1200 vehicles per day. Today, with about 4,500 employees, the
factory is producing 2,000 cars per day.

At the same time, the supply chain will be improved. The delivery of instructions to
the system to place orders to suppliers on the next business day. Now Maruti is
working with an inventory of more than four hours of local goods, as well as a mean
of six days and imported materials. The global inventory-to-sales ratio of up to 100%
in 2014-2015, it is now reduced to 41. Maruti has also started to work with the
suppliers who are in their lower cost of production, so as to reduce the acquisition

21
cost. In addition, the company has recently released a plan for the improvement of the
quality, and it has the Quality Gate system level.

With the advent of so many of MNCs in the Indian automotive market, there will be a
push for lean manufacturing. Maruti has been implemented JITs for some of its most
important suppliers. Some of the others are in the process of doing so. In this highly
competitive sector, with a special attention has been paid to the quality. However, the
success of a JIT, it is not only due to the efforts of the technicians, but also on behalf
of the seller, as well as on the institutional and cultural factors. The bargaining power
of the suppliers of the components is high, due to the limited production capacity.
This will force them to accept a statement by you, and that is why it is more difficult
for the engineers to implement JIT.

The challenges of the Indian automotive industry in implementing JIT:

A number of Indian companies have taken steps to implement NEW, or claim to have
many of the features of the NEW. However, the Indian automotive industry has to
face a number of challenges in the implementation of JIT production systems:

• In comparison with other international organizations, the size of the industry

in India has been medium and small. Therefore, it is of the nature of the
problem, and the nature of the activities can vary.
• The Indian economy is characterized by the surveillance, and disruption, as
well as a lack of long-term stability, and public policy.
• The design element of JIT and other similar manufacturing methods are well-
known in Indian companies. However, there is a lack of internalization of
these concepts, which leads to a lack of transparency in the process of
implementation.
• To set up a system for the extraction of resources for the production to be
organized in a timely manner. The implementation of this system will be
substantial and the reconstruction of the facilities, and demand greater
managerial efforts.

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 • The Indian auto manufacturers have not made significant progress in the
development of the supplier.
• The concept of the quality of the discs was introduced in India in the early
80's. Even though it started out with great fanfare, it did not bring the expected
results, as has been reported in Japan. Therefore, in the Indian car companies
were sceptical about the implementation.
• Indian car companies are failing to notice is that the importance of the review
of the supply chain as a whole. They need to make their supply chains and
implementing a NEW effective way.
• The implementation of JIT in situations where you need to improve the
management of the store in the shortest amount of time possible, with a great
deal of uncertainty in the system.
• Supply uncertainty is difficult, carrier relationships, the influence on the
successful implementation of JIT.
• Indian car manufacturers have a tendency to maintain a centralized
management style. As a local and a professionally managed company, it
would have a better chance of implementing JIT.
• The lack of efficient transport services to the non-availability of the suppliers,
major problems in the transport and communications infrastructure.

Suggestions for the implementation of the JIT:

Taking into account the above-mentioned problems, it is recommended that you use a
3-step approach that can be used for the performance of a production, JUST-in-time
system. The first step is to change the attitude of the purchase and the implementation
of improvements that will help you to prepare for the impact of the dramatic changes
that are to come. The next step is to start with a pilot study of a program in which
multiple suppliers, and component suppliers. This step is focused on the identification
of the problems and how to fix them. The third and final step is to change the
structure of the organization, so that there are separate departments to deal with the
logistics, service and inspection, as well as the grade of other suppliers.

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• The first and most important step is to get the support of senior management, as
well as the support and active participation of all employees in the program.
• The Indian automotive industry to take steps to improve the efficiency of the
supply chain as a whole.
• The Indian automotive industry will need to understand that some of the changes
to the structure of the system are inevitable, which may include the
implementation of a Kanban to reduce the setup time.
• To manage the continuous fine-tuning and optimization of supply and demand.
• It ranges from the more efficient use of materials, and other resources.
• How to manage the demands of the customer and are expected to be.
• The technology and infrastructure to the scale of it.
• Investment in education and human resource development.
• Maintain good working relationships with vendors and suppliers
• Encourage automation.

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 EMERGING TECHNOLOGY USED IN MARUTI SUZUKI
UDYOG LTD.

Warehouse Management System (WMS)

Storage house management systems come in a variety of types and methods of

implementation, and the type depends on the size and size of the organization. They
can be stand-alone systems or modules in a large operating system (ERP) system or a
chain-of-the-line suite.

They can vary greatly in difficulty. Some smaller organizations may use simple series
of hard copies or spreadsheet files, but larger organizations - from small to medium-
sized enterprises (SMBs) to corporate entities - use sophisticated WMS software.
Some WMS settings are designed for the size of the organization, and many vendors
have a variety of WMS products that can measure the size of a different organization.
Some organizations build their WMS from scratch, but it is more common to use
WMS on a trusted vendor.

The WMS can also be designed or tailored to specific needs of the organization; for
example, an e-commerce merchant could use WMS with different functions than a
brick and mortar dealer. In addition, the WMS may also be designed or tailored to the
type of goods the organization sells.

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Radio Frequency Identification (RFID) Technology

RFID belongs to a technology group called Automatic Identification and Data

Capture (AIDC). AIDC methods automatically identify objects, collect data about
them, and then enter that data directly into computer systems without little or no
human intervention. RFID methods use radio waves to achieve this.

At the simplest level, RFID systems consist of three components: an RFID tag or
smart label, an RFID reader, and an antenna. RFID tags consist of an integrated
circuit and antenna, which are used to transmit data to an RFID reader (also called an
investigator). The reader then converts the radio waves into a data-based method.
Information is collected from tags and transferred through a communication interface
to a computer system, where data can be stored in a database and analyzed over time.

26
Light Fidelity (Li-Fi) Technology

LiFi is a technology for wireless communication between devices that use light to
transmit data and positions. LED lights can be used to transmit visible light. Providing
a wireless network of a large number of robots and power tools is a challenging
challenge in warehouses and factories.

The image in the next page shows LiFi technology connected to the drone and robots
to perform storage operations.

LiFi offers greater benefits than WiFi in those areas and can be used as a reliable
wireless communication system in those indoor areas. In addition, bright visual
connections can provide accurate 3D shapes of robots, drones and other devices in
warehouses and factories, where placement and navigation are of paramount
importance.

27
Barcode System

You see barcodes everywhere – from identification cards, to mail, to goods you
purchase in a store. The small image of lines, or bars, and spaces are affixed to nearly
everything you can imagine, for identification purposes. Specifically, barcodes use a
sequence of vertical bars and spaces that represent numbers and other symbols;
typically, a barcode consists of five parts – a quiet zone, a start character, data
characters (often including an optional check character), a stop character, and another
quiet zone.

Bar-coding increases efficiency and productivity in a number of industries when

paired with barcode readers. Barcode readers use laser beams to read the barcodes and
translate the reflected light into data that is then transferred to a computer for action or
storage. Most people are familiar with barcodes and barcode readers in supermarkets
and retail stores. However, barcodes are useful in several other applications, from
taking inventory to checking out books, to tracking bees for research. Barcode readers
often are attached to computers in retail settings, but they also are handheld and
portable for other uses, such as scanning barcodes in warehouses and tracking
inventory.

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Robotics Technology

New robotic technology has become one of the most sought after technology for asset
management. Leading manufacturers are working with archive management software
providers to create custom software and intelligent robots that help manage the
movement, storage, and inventory of inventory.

With the increase in order volumes, more products you can use, more customized
packing and faster shipping needs, robotic solutions will help you respond more
effectively to volume growth and perform more tasks with less work and less cost.
The growing demand for high levels of performance and the flexibility of storage
robots encourages new product development and the early adoption of mobile storage
robots. As an asset manager, one has to choose robotic technology that tailors their
needs in all aspects of workflow.

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 LITERATURE REVIEW

Effective inventory management in the automotive industry: a literature study.

Saliji, Mohamed

Date: 23 June, 2021

The automotive industry is characterized by the weight of the inventory and the
diversity of these resources. They are of such strategic importance of factors in order
to ensure a fast time-to-market. Effective management of such a major benefit, it is of
utmost importance in order to ensure the high competitiveness of the automotive
industry. Stocks commit significant financial resources, while the extra cost of
different levels. The importance of cost-effective management of the cost for the
automobile manufacturers, it is outside the focus of many studies. Many of the
methods and concepts of cost and management have been proposed. However, the
author of this paper and can't find it in the articles or in a review that we have
discussed, it is possible to use these tools and concepts. Therefore, the aim of this
study is to learn about and better understanding of the financial aspects of
management of the stock, using one of the methods that are used to cover the costs of
the management of the inventory.

Queuing Theory an Index Factor for Production Inventory Control in

Automotive Industry—A Review

Sunday A. Afolalu, Segun Oladipupo, Samson O. Ongbali, Abiodun A. Abioye,

Ademola Abdulkareem, Mfon O. Udo, Oluseyi O. Ajayi

Date: 20 August, 2020

In this paper, the different approaches to the management of the inventory in the auto
industry were regarded as the usage of the queue theory. Several of the models used in
the previous literature are presented, and the model is considered to be the most
effective in this study, the docking station management simulation. This model is used
to analyze, manage your inventory, and how to effectively use the auto-industry for
the minimization of the stock by the receipt of the item in the product line, just at the
time, which helps in the reduction of an additional warehouse, maintenance costs, and
capital, and is associated with excess inventory. The analytical and simulation models,
mathematical models, that are the subject of this review, is because they can be used
in a lot of the work of many authors.

30
The impact of marketing strategy on logistics decisions and the implementation
of JIT

Authors: Eszter Sós, Péter Földesi

DOI: https://doi.org/10.14513/actatechjaur.00597

Date: 03 May, 2021

Each project may have a significant impact on the logistics, and corporate activity,
and that it is necessary to have a sales strategy in the life of the big corporations, so as
to logistics solutions are not distorted by the marketing strategy. In accordance with
the present direction of development, more and more goods that are constantly on the
move, with less and less time. Therefore, companies prefer to use the Just-In-Time
(JIT), which in turn leads to a gradual reduction in the price of the stock, but it
increases the burden on the environment. This paper analyses the interaction of
marketing and logistics, as well as the logistics required to implement a JUST-in-time
system. For the study, we make use of the Quality Function Deployment Matrix
method (QFD) for the assessment of the needs of the customer in relation to the
JUST-in-time system in which the explanation of the logistics of the strategies that
can be implemented prior to the implementation of any specific product.

Achieving a just–in–time supply chain: The role of supply chain intelligence

Authors: Jie Yang, Hongming Xie, Guangsheng Yu, Mingyu Liu

Date: January, 2021

Drawing on a three-demand-driven supply chain, analysis, strategies, this study

examines the influence of three factors, demand-driven supply chain analysis,
including know-your-customer management, knowledge-sharing and co-operation in
the just-in-time supply chain, which is operationalized through the planning,
production, sourcing, and logistics company. It will also assess the impact of Just-in-
Time supply chain and business performance. On the basis of a supply chain analysis
on the basis of the data obtained from the manufacturing companies, this study offers
empirical evidence for the important role played by demand-driven, supply-chain
intelligence and the just-in-time supply-chain implementation, and the resulting
impact on performance. The theoretical and practical contributions are to be
considered as well.

31
An overview about JIT (Just-In-Time) - Inventory Management System

Authors: Dr. C. Eugine Franco, S.Rubha

Date: 30 April, 2017

To the left of the reserve is not desirable for the manufacturer, if it will stop the
production process. The list is in stocks and the ideal means of a company for the
future. Manufacturing organizations tend to have the raw materials, materials, spare
parts, tools and equipment, semi-finished products, etc., etc. the product must not be
too high, or too small. It should be the best. The newest trend in the management of
the stock, it is JIT (Just-in-Time). A paradigm is going to be much disciplined, to
work with the structure. This calls for a change in the world. It will also include the
Japanese organizational features, such as lifetime employment, and the implicit
control mechanisms as well as collective decision making, collective responsibility,
and is a consistent representative of care. The point is to be used for all enterprise
features, not just in the business.

32
 OBJECTIVES OF THE STUDY

My project entitled “To Study Just In Time Inventory Maruti Udyog Ltd” aims at
studying scope of JIT.

 To study the implementation of Just-in-Time inventory management in Maruti

Suzuki India Limited.
 To analyze the operations of Maruti Suzuki India Limited post implementation
of JIT
 To compare the inventory management practices in Maruti Suzuki and
Hyundai.

33
 RESEARCH METHODOLOGY

A method of researching specific processes or techniques used in inventory

management of Maruti Suzuki and to analyze the information related to Just-in-Time
inventory management practiced there.

In any project, a research methodology section allows the student to critically evaluate
the overall validity and reliability of a subject. The research methodology section
answers two important questions: How was the data collected or generated? How was
it analyzed?

The purpose of this section is to describe the research process and the methods used to
achieve the project objectives. Here, case-study-based Research Methodology is used
which aims to study the Just-in-Time inventory management in Maruti Suzuki.

Purpose of research: To explore the JIT inventory of Maruti Suzuki and how they
improved it continuously through the integration of various latest technological
advancements.

Type of Research: Exploratory Research (Case study).

Type of Data: Secondary Data

Methodology of data collection:

 Reference Books
 Secondary Data Collection
 Internet and various websites

DATA COLLECTION:

Data collection includes the type of data & the source of data that we used while
doing a project. The data collection can be from both primary and secondary sources.

The data collected here are from secondary sources.

34
Secondary Data:

Secondary data refers to data which is collected by someone other than the primary

user. It involves using already existing data. Common sources of secondary data
for social science include censuses, information collected by government
departments, organizational records and data that was originally collected for other
research purposes, collected by the investigator conducting the research.

Data analysis:
The data analysis of this study is represented in qualitative manner. Qualitative data
can be observed and recorded. This data type is non-numerical in nature. Qualitative
data collection is exploratory in nature and involves in-depth analysis and research.

35
 CASE STUDY

JUST-IN-TIME INVENTORY MANAGEMENT IN MARUTI

SUZUKI INDIA LIMITED

Maruti Suzuki India Limited (MSIL) Maruti Suzuki India Limited is India's largest
car manufacturer with more than 50 percent of the market share in the passenger car
segment for the year 2017-18. The company recorded its highest sales at FY18 with
approximately 1,779,574 units.

During 2017-18, the company recorded Rs 84,039.9 crore (US $ 13.04 billion). It has
1820 outlets in 1471 cities and 3145 service networks in 1506 cities. It has seen
increasing competition from real global manufacturers and growing customer
expectations and maintaining its market height, contributing its efforts to
understanding R&D (Research and Development).

MSIL has been redefining and redesigning its service delivery strategies to reduce
costs and increase efficiency. It has been consistently established to reduce operating
costs, achieve better performance and improve customer service through effective
transaction management.

Continuous supply and inventory management are the critical to success and JIT in
providing strategic and robust strategy. In 2018 MSIL plans to enter the electric
vehicle segment. It started with a field test of vehicles. In 2016 MSIL sent the first car
‘Made in India’ to Japan. In 2012 MSIL ranked first in India for thirteen consecutive
customer satisfaction. 2008 MSIL Launched 'A-Star', the country's fifth strategic
model. It also introduced National Road Safety Planning in the same year. In 2005
MSIL was ranked 91st in the Forbs list of the 200 most respected companies in the
world and the 7th in the automotive sector. In 2003 Just in Time (JIT) and E-Nagare
to establish system management began. In 2001 MSIL entered the front of the car. It
had opened True Value, its first car park, in Bangalore. In 2000, India's first car
company launched a customer care center. The company was awarded the ‘Highest
Exporter Award’ in 1996 Introducing India’s first 24-hour service on the road. In
1991 MSIL received the 1991 Corporate Performance Award by the Economic Times

36
- Harvard Business School Association. In 1983, the company was associated with the
launch of the amazing Maruti 800. The first collection of Maruti Suzuki cars was
compiled.

Innovation Management System: Maruti Suzuki India Limited

MSIL has 246 international and 20 international suppliers working seamlessly. It gets
its goods ordered last night in a space of two hours the next day. It had adopted JIT to
reduce acquisition costs and therefore achieved high efficiency. MSIL has adopted E-
Nagare's electronic flow system which completely changed its delivery.

The MSIL local segment has made significant changes from 385 previous suppliers to
246. Smaller suppliers had entered the Tier II car dealership list after the perpetrators
were removed. MSIL has begun insisting on 'full service delivery' to its Tier I
providers instead of providing each component separately. It has a total of 800
suppliers including Tier II and Tier III providers.

The company prefers locally based suppliers to acquire JIT assets. More than 80
percent of its 246 suppliers are located within 100 miles of potential. These are
powerful suppliers of 86 percent of the value in Maruti. The company supports its
vendors in all possible ways including investment, technology and management
support; finding technology partners and bringing transparency to its operations.

At MSIL, E-Nagare or 'electronic flow' is a religion. It is a series of production

programs from retailer to MSIL stores, which have reduced the two-hour cycle from
the last 30 days. Across from the MSIL twin plants in Manesar and Gurgaon, multi-
colored bumpers reach the mobile trolleys and parts line up outside the factory shares
directly feeding the assembly lines. Inside the factory grounds, the inventory is only
two hours long.

MSIL used to offer a one-month plan for their needs, which resulted in providers
becoming more productive and innovation rates began to rise. To reduce inventory
levels, MSIL has reduced its monthly supply of goods to 15 days and commodity
levels within the plant have dropped by 70 percent. MSIL has embarked on a similar

37
process with Tier I suppliers to use the same program with their suppliers to make
purchasing purchases at all levels.

Today, MSIL retailers are reaping the benefits of an advanced manufacturer (OEM).
Vendors have been providing MSIL via JIT and directly online, which means that the
component is approved and the company does not have to test them at all, making it a
100 percent foolish witness process.

E-Nagare has resulted in better power consumption at the end of the vendor. At
MSIL, while the list of items has been greatly reduced, any system malfunctions are
now visible. In the case of suppliers, any reduction in costs by MSIL greatly reduces
their overruns.

MSIL has been able to reduce the number of person hours spent per car by half in just
five years through a number of programs involving employees up to Tier II dealers, as
well as managers. One of those strategies is to bottle-necking its production lines
every year. The use of equipment and the efficient use of staff have increased the
productivity of its retail facilities by 20 percent, saving them a lot of money in setting
up new service areas.

At the forefront of assets, MSIL assists retailers in asset management by reducing

listed items, which means lower costs to merchants' operating costs. MSIL analyzes
the market, as well as daily surveys, inventory, orders and sales, and sellers are
informed of vintage stocks, which are 3 to 4 months old, which is a heavy amount
stuck in old stock that needs to be consolidated very quickly.

JIT and E-Nagare's asset management systems, which began in 2003, have reduced
asset prices to less than a day. In 2010-11, the company began encouraging its
suppliers to supply items during the night shift, which helped reduce pollution and
traffic congestion on its plantations and in the city of Gurgaon. The dairy milking
program was introduced in 2010-11 to 30 providers based in Faridabad. The
management of these companies is managed by a single supplier. The move has
helped reduce the number of trips per day to MSIL by 30 percent from these suppliers
and to improve the truck load by more than 25 percent.

Maruti Suzuki was previously a "Maruti Udyog Limited" a car manufacturer in India.
Maruti Suzuki was the first company to launch the JIT program in India. JIT requires

38
all providers to be competent enough to meet the manufacturer's needs in a timely
manner. This requires Maruti Suzuki to have its main suppliers to be located near the
assembly center to allow for the delivery of items from time to time. Also, the quality
of the items delivered required reliability. This will reduce the need for detailed site
testing and quality testing conducted by Maruti Suzuki. This reason has led Maruti
Suzuki to encourage its suppliers to set up their own plants near the Maruti plant.
Also, it had a double acquisition plan, due to the unfamiliar infrastructure, at the time,
which often disrupted delivery time. The strategy has given manufacturers of many
car parts the opportunity to interact with Maruti Suzuki.

Maruti Suzuki is a car manufacturer in India. It is a 54.2% owned company by

Japanese car and motorcycle manufacturer Suzuki Motor Corporation. As of January
2017, it had a market share of 51% of the Indian passenger car market. The cost of
using raw materials was 75-83% of net sales. Therefore, the company has been paying
close attention to its asset management. And about 70% of companies are exported.
The company has therefore taken various efforts to improve its inventory
management as a result of the increase in its profit margin over the years. e.g. The
company's average profit margin increased from 11.9 (2005-06) to 13.9 (2006-07).

1. Are you satisfied with management's claim to improve inventory

management by MUL?

Inventory Turnover ratio is an efficiency measure that measures how often an asset's
value is sold or converted over a period of time. It shows how effectively the asset is
managed by the company. The company's average profit margin increased from 11.9
in 2005-06 to 13.9 in 2006-07.

In the year 2001-02,

 Net sales: 7067.7cr

 COGS: 75% of Net sales
 Average Inventory: 820.55cr
 Inventory Turnover Ratio = COGS/ Average Inventory
(.75*7067.7)/820.55=6.46

39
In the year 2006-07,

 Net sales: 14592.2cr

 COGS: 75% of Net sales
 Average Inventory: 843.17cr
 Inventory Turnover Ratio = COGS/ Average Inventory
(.75*14592.2)/843.17=13.9

Therefore, from the data we calculated the inventory turnover ratio and found the rate
increase from 6.46 in 2001-02 to 13.9 in 2006-07.

Therefore, we can say that the company is doing well in asset management.

2. What steps has MUL taken in the past to improve its inventory
management?

MUL's inventory management has been improved due to the Just-in-time (JIT)
inventory management system followed by the company. These plans were:

 Warehouse Management System (WMS)

 Radio Frequency Identification (RFID) Technology
 Light Fidelity (Li-Fi) Technology
 Barcode System
 Robotics Technology
 Kanban Production System
 Vendor Management
 Localization

Warehouse Management System:

Household management refers to the management of operations in a warehouse.

These include acquiring, tracking, storing, and training staff, managing shipping,
arranging luggage, and monitoring shipments.

Warehouse Management System (WMS) is software designed to improve operating

procedures in a warehouse. By using WMS you have full visibility in the final levels

40
of real-time assets and storage, staff productivity, demand forecasting, and ordering
the flow of work within the asset.

Storage systems are important as they eliminate manual processes and speculative
work and instead adjust time-saving processes and provide a more accurate summary
of what is happening within the facility without the need for continuous auditing.

Radio Frequency Identification Technology:

Radio Frequency Identification (RFID) allows a business to identify products and

services, and track them across a range of feeds from production to sales.

RFID is a technology that uses radio waves to communicate between a tag and a
reading device. The marker usually has a microchip attached to the antenna. The
reader is able to read data from and write data to the tag.

An RFID tag is a small microchip, as well as a small aerial, that can contain a range of
digital data for a specific object. The tags are packaged in plastic, paper or other
similar materials, and are packaged in product or packaging, pallet or container, or
van or delivery truck.

The mark is being investigated by an RFID student who sends and receives radio
signals from and from the marker. The information collected by the student is
compiled and processed using special computer software. Students can be placed in
various locations within the factory or warehouse to show where the goods are being
delivered.

Light Fidelity (Li-Fi) Technology:

Li-Fi is a wireless communication technology that uses diode-emitting diodes (LEDs)

to transmit data.

Li-Fi is designed to use LED lights similar to those currently in use in many energy-
efficient homes and offices. However, Li-Fi chip-insulated chip converters light that
is not visible through visible data transmission. Li-Fi data is transmitted by LED
lights and detected by photoreceptors.

41
Barcode System:

A barcode is a machine that reads mechanically in the form of numbers and patterns
of the same lines of various widths printed on the identification product.

A barcode reader is required to read the code. The reader uses a laser beam that can
detect visual acuity from lines and the size of the space and convert that pattern into a
number in digital format.

Processing systems, POS systems, etc. use this digital format to transfer information
about that product to various locations where users can make wise decisions about
their product and business based on the data collected. Barcode system can:

 Reduce processing time

 Increase accuracy of data
 Increase speed of operation

Robotics Technology:

New robotic technology has become one of the most sought-after asset management
technologies. Leading manufacturers work with archive management software
providers to create custom software and intelligent robots that help manage
movement, storage, and inventory.

Kanban Production Program:

In the Kanban System, delivery dates are made every 15 days and goods are shipped
accordingly, connected via an electronic communication system. Also E-Nagare is
linked to the material requirement planning (MRP).

Vendor Management:

Through its vendor development program, Maruti has reduced the number of vendors
from 370 in 2000 to 299 in 2003 and plans to reduce it to 100. About 80% of the raw
material comes from within 100 miles. The company has moved from a number of
smaller suppliers to a major tier 1 supplier. It improves efficiency and quality
economy.

42
Localization:

MSIL works to improve vendors' ability to make and supply items. Minimum
performance was 70% and maximum 96%. Local manufacturing has increased the
number of indigenous products.

1. What measures has the company taken to reduce its ordering and carrying
costs?
 Order costs are the costs incurred in creating and processing an order from a
supplier.
 The cost of carrying the inventory or holding assets means the total cost of
holding the asset.
 Measures to reduce these costs:
o Vendor Management
o Localization

Vendor Management:

More than 70% of MSIL providers come within a 100-mile range; here parts can be
delivered directly to the assembly line thus reducing packing costs. MSIL ranges from
small suppliers to tier-I suppliers who supply integrated materials, thus reducing the
cost of orders. Also, personal hours spent on each car have been reduced by 54% over
the past three years. Encourage retailers in remote areas to set up warehouses nearby.
Developed a WWP (Global Purchasing) system, where the retailer can be the sole
supplier of Suzuki products in several countries. Milk delivery systems exist to use
bulk trucks by assembling items from different vendors.

Localization:

The company has worked to increase the number of locals and equipment used to
reduce administrative costs. They aim to achieve a 90% local standard. The number of
imported petals increased from 20:80 to 50:50 within three years. This rate is
expected to rise sharply in the coming years. The raw material used by domestic
suppliers has grown from 73% in 2003 to 87% in 2007.

43
2. How did MUL successfully use JIT?
 The company makes good use of technology, namely delivery system, Bar
code and e-Nagare.
 Effective and efficient retailer management.
 Increasing supplies from a local supplier, thereby reducing costs.
 Maruti has supported its vendors in plant setup, automation process and value
engineering.

COMPARATIVE ANALYSIS: MARUTI SUZUKI AND HYUNDAI

A comparative study of the Maruti Suzuki exhibition room and the Hyundai
exhibition room shows an understanding of how inventory is handled by companies.
The Maruti Suzuki exhibition room has many brands including Alto, Swift, Brezza,
Wagon R, each Celerio has many sub-categories.

Distribution Channel

As for the distribution channel, Maruti Suzuki products are available in the production
area. For example, Swift has a manufacturing factory in Gujarat and another in
Gurgaon. Every retail outlet has stock where the car has to go. From stock, the
product comes to retailers and is delivered to a specific customer. They don’t keep all
the cars in the showroom because when there are too many cars it can take up a lot of
space. At the time, at a Hyundai factory located in Chennai. All vehicles are still
being distributed from Chennai directly to the cells. Their stock is in Bhiwandi. From
the cell, the cars are brought to various furniture located in Wasai, Thane, Santacruz.

Waiting Period

At Maruti Suzuki the products usually have a 4-6 week waiting period provided by
the company itself. The same product has the same waiting time across the country.
Every product has a different waiting time. For example, Brrezza has a waiting period
44
of 4-6 weeks while Swift has a waiting period of 3-4 weeks. If a seller has a product
that others do not have, that seller will deliver it before the waiting period. Waiting
time is informed by customers during the booking itself. If they do not have the
product, the customer is notified. If they have a product, delivery is done once the
customer has paid. If there is no waiting time for the products and payment is made
by the customer within a day's time, then the delivery is done within 5-6 days. The
loan takes an additional 4-5 days to submit. Retailers have price lists and charts that
show waiting times. These charts are from the company itself. A customer agreement
is signed, which is called an order booking form. All details relating to price, vehicle
model, customers details and waiting time are stated on that form. While, usually the
Hyundai Company maintains a list of vehicles and delivers 125-140 per month on
average. However, cars like Creta that have a higher demand or other recently
introduced product are not kept in stock. However, if the product is not in stock, they
deliver the product within 2-3 weeks. The waiting time varies according to the car.
Creta is Hyundai's best-selling car right now. Therefore, the waiting time is very high
in Creta (4 weeks for gasoline variation and 8 weeks for diesel variance). If vehicles
are available and payment is made transparently, the RTO process takes at least 5
working days. If a loan is available, an additional 4-5 days are required for
submission.

Stock dumping

No stock losses at the Maruti Suzuki exhibition grounds. HODs are aware of the best-
selling product in terms of past customer inquiries. Many questions mean more
bookings. Full guidance is provided from the company accordingly. A product with a
lot of questions has a bigger purpose compared to others. At Hyundai, stock is
discarded by manufacturers to retailers and they have to sell all stock. There is no set
time to sell the stock. Stock is discarded no matter how much the customers want.

Peak Season

How has the Maruti Suzuki made it possible during the season? At MSIL, the holiday
season is the busiest time of the year. Reservations are made one month in advance so

45
that customers can deliver delivery on the day of the festival. During this time, every
retailer receives some personalized feedback from the company itself. These dealers
have to sell so many cars. Every product has a different goal to achieve. When the
targets are fulfilled and there are additional bookings from customers, that product
orders. While Hyundai has peak holiday seasons between the months of October,
November and December. They take pre-bookings to customers who plan to take
delivery on a good day for Diwali. Orders are taken 1-1.5 months before delivery
date. When a customer places an order near the day of the festival, retailers do not
make a commitment to customers regarding Diwali delivery because stocks and
operating capacity are limited. So they can't go beyond their strength.

Spare parts

At Maruti Suzuki, all stores have one workshop. This sale where we did our
conversation we have on Link Road. Inactive sections are kept in these workshops. If
they do not have the resources, they contact the customer so that it will be delivered to
them on time. While Hyundai has a lot of entertainment features available in the
workshop. Every retailer has a different workshop like MSIL. The vendor has
workshops in Thane and Wasai.

The JIT production plan identifies hidden problems in the value chain and emphasizes
the need for ways to streamline production flow, depending on customer demand at
all levels. It seeks to slow down the speed and flexibility of this flow by making it
easier to operate. This requires problem solving and renaming the store in order to
identify and eliminate all wasteful sources of diversity. Such store operations are
driven by the Kanban system of information and control. Although it may not seem
complicated, it requires a lot of interaction with the supply chain to reduce delays in
the production schedule.

46
 FINDINGS

In this case study we found out that- with the implementation of JIT:

1. MSIL has been redefining and redesigning its service delivery strategies to
reduce costs and increase efficiency in order to reduce operating costs, achieve
better performance and improve customer service.
2. Continuous supply and inventory management are the critical success factors
of JIT in providing strategic and robust strategy.
3. With the implementation of JIT, the inventory turnover ratio has increased
from 6.46 in 2001-02 to 13.9 in 2006-07.
4. With JIT MSIL has been able to reduce the number of person hours spent in
production per car by half.
5. Inventory management has been improved due to the Just-in-time (JIT)
inventory management system followed by- Warehouse Management System
(WMS), Radio Frequency Identification (RFID) Technology, Light Fidelity
(Li-Fi) Technology, Barcode System, Robotics Technology, Vendor
Management, Localization, etc.
6. Ordering cost and carrying cost of an order from a supplier are reduced by-
Vendor management and Localization.
7. The company has made good use of technology for effective and efficient
retailer management. And also increases supplies from a local supplier,
thereby reducing costs.
8. Maruti has supported its vendors in plant setup, automation process and value
engineering.
9. MSIL has been consistently introducing innovations in order to improve
efficiency, quality and cost effectiveness of inventory management.
10. MSIL has been responding to changing markets and has been reviving its
purchases.

47
 11. With the changes in inventory management all suppliers got benefited in terms
of non-essential services, the integration of suppliers into the price chain, cost
reductions, inventory reductions, and the minimum travel time.

CONCLUSIONS

The Indian Automotive Industry was highly competitive and will continue to be highly
competitive. Continued innovation in supply chain management and inventory
management will contribute significantly to the efficiency of the entire chain of suppliers
and will provide many benefits to all. Inventory management has been improved due to
the Just-in-time (JIT) inventory management system followed by various innovations-
Warehouse Management System (WMS), Radio Frequency Identification (RFID)
Technology, Light Fidelity (Li-Fi) Technology, Barcode System, Robotics Technology,
Vendor Management, Localization, etc.

MSIL has encouraged vendors in far-away places to set up warehouses nearby and
therefore been able to reduce the number of person hours spent per car by half in just five
years through a number of programs involving employees up to Tier II dealers, as well as
managers.

MSIL has worked on increasing the proportion of locally sourced components and raw
materials thereby reducing the carrying costs. The raw material used from domestic
suppliers has grown from 73% in 2003 to 87% in 2007. They aim to achieve 90%
localization level.

MSIL has been responding to changing markets and has been reviving its purchases. The
changes implemented have benefited all suppliers in terms of non-essential services, the
integration of suppliers into the price chain, cost reductions, inventory reductions, and the
minimum travel time that has been completed. The future will bring more challenges;
MSIL will need to be flexible and responsive to their supplier development approach.
Consistently introducing innovations in order to further improve efficiency, quality and
cost effectiveness will be important.

48
The JIT production system identifies hidden problems in the value chain and emphasizes
search of ways to make production flow ubiquitous, depending on customer demand at all
stages.

It wants to gradually accelerate the speed and flexibility of this flow by making it easier
jobs. This requires troubleshooting and renaming the store for re-identification remove all
wasteful sources of diversity. Such store operations are motivated by Kanban system of
information and control. Although it may not seem complicated, it requires more
communication with supply delivery to reduce delays in production schedule.

49
 SUGGESTIONS

1. The future will bring more challenges; MSIL will need to be flexible and
responsive to their supplier development approach.

2. MSIL should consistently introduce innovations in order to further improve

efficiency, quality and cost effectiveness will be important.

3. Educational programs should be conducted to educate the vendors with special

emphasis on just in time supplies and cost- benefit analysis, so as to improve
localization level.

LIMITATIONS OF THE STUDY

Although sincere efforts have been made to collect the maximum information from
the respondents, but even then the report is subject to following limitations:

1. This study is based on one of the automobile industry. There are many other
automobile industries that were not taken into account.

2. Time constraints: The project time was short and had to be completed on time.

3. As it wasn’t possible to physically visit the industry due to Covid-19

restrictions. So the study is done only on the basis of secondary data
collection.

50
 BIBLIOGRAPHY

1. Effective inventory management in the automotive industry: a literature study.

(Saliji, Mohamed)
2. Queuing Theory an Index Factor for Production Inventory Control in
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Samson O. Ongbali, Abiodun A. Abioye, Ademola Abdulkareem, Mfon O. Udo,
Oluseyi O. Ajayi)
3. The impact of marketing strategy on logistics decisions and the
implementation of JIT (Authors: Eszter Sós, Péter Földesi)
4. An overview about JIT (Just-In-Time) - Inventory Management System
(Authors: Dr. C. Eugine Franco, S.Rubha)
5. Achieving a just–in–time supply chain: The role of supply chain intelligence
(Authors: Jie Yang, Hongming Xie, Guangsheng Yu, Mingyu Liu)
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10. https://www.linkedin.com/pulse/just-in-time-manufacturing-indian-
automotive-industry-nikhil-hulwan

11. Inventory Management in Indian Industry (A study of Maruti Udyog Limited)

www.ijariit.com
12. Logistics and Supply Chain Management - D K Agrawal
13. Inventory Management - L C Jhamb
14. www.fishbowlinventory.com/articles/inventory-management/inventory-
management-techniques/
15. www.google.com

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16. www.linkedin.com

ANNEXURE

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