Just In Time

Case study: transitory JIT at Proton Cars, Malaysia
Mike Simpson, Geoff Sykes and Adini Abdullah
Sheffield University Management School, Sheffield, UK
Introduction This paper investigates the application and adaptability of just-in-time (JIT) in the largest Malaysian automobile manufacturing company (Proton). The main objective of this paper is to develop an understanding of a Malaysianversion of JIT in its automobile industry and to examine the concept of JIT in a Malaysian manufacturing setting. This is especially interesting and important since Malaysia has not gone through the usual stages of a craft era (labour intensive, highly-skilled workers) followed by Fordism (mass production of single products, semi-skilled workers) and post-Fordism (mass customisation, multiskilledworkers) (see Wilson, 1992). Although, some might argue that they have actually gone through these stages but over a very short time, thus giving scope to manufacturing management for a variety of approaches (Womack et al., 1990). There are other ways of looking at the development of manufacturing and operations management (Monks, 1987; Sykes et al., 1997). For example, Monks (1987) suggests a frameworkbased on US experiences with a Handicraft era (circa 1700-1800), Industrial Revolution (circa 1800-1890), Scientific Management era (1890-1940) and Operations Research and Computerised Systems era (1940-present). However, these ideas seem even less applicable to developments at Proton. The secondary objectives of this paper are to: • Determine the amount of JIT activity in the company. • Look atthe structure of the buyer-supplier relationships that support the JIT system. • Draw out the factors that support and hinder the successful implementation of JIT in the company. • Identify where the Malaysian version of JIT differs, if indeed it does, from the conventional Japanese form of JIT. Background Industry and company The automobile industry in Malaysia began in 1962 when Ford MotorCompany of Malaya was incorporated and began operation with 16 employees fitting wheels, doing body repair and paint touch-up work in a rented shop-house in Singapore. In 1963 the initial move for local production of automobiles in Malaysia began. It was realised by various government bodies and politicians

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at that time that automobile production might be a worthwhile industry in Malaysia. In September 1963, the Federal Government announced its intention to encourage the establishment of an automobile industry as part of the industrialisation programme and in May 1964 thegovernment announced its initial policy on automobile assembly (Abdullah, 1995). The automobile industry was officially launched in Malaysia in 1967 when six assembly plants were granted approval by the government to start operation. The Malaysian Government took a very long-term strategic view to create an automobile industry. Initially, completely built-up (CBU) units were reduced and replaced bycompletely knocked-down (CKD) packs. Then in the mid-1970s, a core leadership group of about six parts manufacturers organised a broader, more coherent organisation and in 1978, the Malaysian Automotive Components Parts Manufacturers Association (MACPMA) was established. In 1979, the government announced its intention to move towards an all-Malaysian car through the process known as mandatory deletion ofparts of completely knocked-down vehicles. Under this process, foreign assemblers were prohibited from including certain components in the imported CKD packs, thereby creating opportunities for local component makers. Government policy was to move from completely built-up to completely knocked-down to completely made locally (CML). However, the development of the motor vehicle industry in...