Origins of profitability through JIT processes in the supply chain

Purpose – To develop a conceptual model that links specific antecedent improvements in supply chain processes to improved financial performance indicators. Design/methodology/approach – A case study was conducted to document one electronics manufacturing company's evolving integration of JIT-driven processes in the supply chain. Data were collected by interviewing key members of the senior management team, site visits, and analysis and review of company documents. Findings – Point-of-use systems, assemble-to-order systems, elimination of physical inventory counts, and the online supplier program are linked to improved processes such as physical plan layout and use, material handling, quality control and manufacturing efficiency, that resulted in improvements in financial performance. Research limitations/implications – A single site case study limits the generalizability of the findings. Additional research is necessary to replicate the findings in other firms/industries. Practical implications – By disaggregating JIT-driven processes and by incorporating some improvements in production processes in the supply chain, the model enables managers to utilize these processes to improve financial outcomes. Originality/value – A conceptual model that integrates and delineates links between three sets of variables, i.e. JIT-driven processes in the supply chain, improvements in production processes, and financial performance indicators.