Critical assessment of Just-in-Time (JIT) process within a South African company: the case of Sabertek

The intense competition in the current marketplace has forced local companies to re-examine their methods of doing business to improve product quality and reduce cost of production at a faster ratethan its competitors (Singh & Ahuja, 2012). The South African manufacturers have struggled with growing trade deficits and outsourced operations. Although proponents cite the many benefits of JIT adoption, its implementation rate in South Africa has been relatively conservative and is highly criticized, especially in comparison with India (Jacobs, 1997; Singh Ahuja, 2014). The purpose of the study is to verify the financial impacts on a company’s performance on reduction of waste by implementing the JIT principle. The focus of the study will be looking at the profit derived of a company’s production line by comparing the amount of waste reduction of a JIT line, as opposed to a non-JIT line. This is of significant importance, since the profits of a company effects the GDP of South Africa, and increases employment (Jacobs, 1997). This study is a replication from Cua (2000) and is a quantitative study. The case study company, Sabertek, has two different manufacturing plants where one plant uses JIT, whilst the other plant does not use JIT. Structured questionnaires were considered and administered to the senior staff and various technical staff of each plant for the collection of primary data. This was approximately 120 personnel (60 questionnaires in each plant) with a total expected response rate of 30%. This was used to compare the profit of a JIT line, as opposed to a non-JIT line, especially in relation to reduction of waste. Secondary data from the company’s financial records of each plant relating to the return rate from rework, sales, profit from the different production lines were equally looked at.

Keywords: JIT, market place, profit, JIT line, non-JIT line, primary data, secondary data.
JEL Classification: L10, D21, C8