Use of simulation for determining appropriate levels of buffer inventories in a JIT environment: A new perspective on implementation of JIT

Approaching zero inventory from the Japanese JIT perspective involves removing Kanbans until problems result and then addressing those problems. This paper uses simulation using key variables to arrive at an appropriate level of decoupling inventory based upon the current state of the process variables. The effects of further process improvements on optimal inventory levels can also be determined through simulation. The paper uses a hypothetical example to illustrate how simulation can be combined with a program of continuous improvement to implement JIT. The simulation strategy is shown to provide a means of implementing JIT without incurring the production downtime required using the traditional Japanese strategy.