A Timely New Chapter To The "Just In Time" Story
by John Laumer, Philadelphia on 03.24.07
Much of the push to "re-engineer" business to "streamline for profits" over the last twenty years is captured in the buzz-phrase Just In Time(JIT). If you were a a business owner, experts urged you to store as much as possible of your inventory in the trucks moving toward your customers from outsourced suppliers, minimizing your own payroll and warehousing costs. A product line manager discovered to have amassed a cache of actual inventory faced dismissal, and so on. As a result, trucks in North America and Europe are, in effect, the warehouse system. Hence, the recent argument that under NAFTA, that Mexican trucking companies should be allowed to bring goods in to the US without transferring. The glue that holds this logistical approach together is comprised of the Enterprise Software System, so-called Business to Business (B2B) linkup portals, and a lot of phone calling and fancy shipping contracts. A seldom acknowledged JIT casualty is the near end of the warehouse full of unsold crap merchandise, dumped via "clearance re-sellers". Those clearance malls along the expressways of America are now most likely getting their inventory JIT, as the retail stores in the mall do. One seldom discussed drawback of JIT is the swarm of half- or mostly-empty trucks driving from supplier to distributor or customers and back; or worse, completely empty trucks going half way across the country to get to the next load. With fuel so much more costly and highways slipping into gridlock, might businesses soon have to go back to classic product designs stored in venerable warehouses? Not quite yet.
There's another software trick or two left to try. Via WBCSD, Financial Times, 13 March 2007 - "Transport companies are using route-planning software [such as the Roadnet transportation suite] to reduce emissions and internet matching systems to fill empty vehicles. A family in Oregon recently embarked on an unusual experiment. Using the package-flow technology developed by UPS, the global transportation company, the family saved $3.69 a day on fuel – almost $1,000 over the course of the year".
"When such savings are translated to UPS's fleet of almost 92,000 cars, vans, tractors and motorcycles, the results satisfy not only finance executives but also those trying to cut the company's carbon footprint."
Here's the money quote for trucks: "Using this technique, Roadnet customers generate surprising savings on fuel and emissions. Collectively, Roadnet clients save an estimated 54.4m gallons of fuel a year and can cut about 85,000 trucks and cars out of their logistics systems".
And for planes: "Because aircraft are at their most fuel-efficient at cruise altitude, reducing the time spent circling at lower levels substantially cuts emissions. Automatic dependent surveillance-broadcast technology (developed by UPS Aviation Technologies, now part of Garmin International) uses GPS to determine a plane's position and lets pilots space out their aircraft more efficiently during landing. Aircraft can use a continuous descent approach while flying in idle mode, cutting emissions by 3 per cent between cruise altitude and runway, and by 34 per cent below 3,000 feet".
The entire article is terrific and identifies additional techno-fixes to the JIT system. TreeHugger recommends it.
Image credit: Cray -Cyber
Maybe I alone find the term techno-fix intensely irritating. But it also lacks any clear meaning. Everything we do, we have a technique for, which makes everything technology. Software to manage just-in-time management (which in turn saves resources, and carbon, required to build up inventory, heat and maintain warehouses and so on) involve technology. So does the construction of sailing ships, wind generators, and so on. Even reducing our demand involves techniques for self discipline. Indeed, I can only think of one thing that you could safely describe as something other than a technological solution: gobbling uncontrollably until we suffer a total collapse.
=== author's response follows ===
Sorry for being irritating. My intent was to indicate a "fix" from the desktop and policy point of view instead of at the street and building level.
It is not possible to know with any precision whether the net efficiency of commercial transport would have remained X better if it had remained more inventory bound. But, I do think it is reasonable to speculate that by driving everything into trucks by taxpayer subsidy of the road system and by means of JIT, that we have taken freight out of the rail system more than we would have. More broadly, gains in convenience and cost savings came at a real price. For example: in Europe, where the "techno-fix" is not yet begun, it is estimated, per the article linked to, that one in three of every trucks on the road are empty during a return trip. Regardless of how good European trains are, that is pathetic. The software solution can only help.
I agree that rail (including intercity, light and underground rail) is a better solution for freight overall.
However, managing something "better" that wouldn't exist at all if not for the bizarre hothouse economic conditions (globalization of trade, cheap energy) of the late 20th century, is not really a solution at all. Not to say it shouldn't be done, but that we should look towards the next phase.
Which is of course, the classic bits vs. atoms debate. Ideally we should make everything locally, from locally sourced, sustainable materials whenever possible. If you take the analogy of downloading music from iTunes and burning it to CDs, or perhaps closer, buying house plans and building / adapting it to the local terrain, the future may well involve less trucks shipping things, and more servers sending us files to have things made at the local fab-lab.
Instead of having clothes made overseas, they will be made locally (even the fabrics), but the designs will be licensed downloads. (Comme Des Garcons 2.0)
"Even reducing our demand involves techniques for self discipline."
I don't see how that is 'techno-fix'.
Surely it's a 'pyscho-fix'?
Good article, I liked the quote “Just-in-time is one of those concepts that makes sense while oil is cheap, but it doesn't make sense when oil is expensive.”
I.T. is a good techno-fix (!) for stuff like logistics, as it allows communication & planning on a much more detailed level, so you can better optimise what you already have.
I would like to add some quite qualified comments to this debate on JIT. I worked in material handling at a huge double line auto assembly plant in Ingersoll ON. for 17 yrs. We made the Chev. Tracker and now they make the Equinox. JIT is big companies downloading their logistics and warehousing onto others, be it municipalities or smaller suppliers. Yes you regularly see half to even smaller loads. You also see stressed out, angry truck drivers (you have probably driven alongside them on the 401), that are fudging their log books and driving more time than they report. Traffic jams at midnight in a small town aren't normal, they are jit related. If the plant goes down, the stock keeps coming and there are no warehouses to store it in, trucks get backed up and yep there goes the anger factor. If they run out of parts they fine the supplier and trucking co. so you see speeding and more stress. There are many instances of this. Every snow storm the only time they close the plant is if the parts don't make it, they don't care if you can make it home, only if the parts make it. Transportation policy should be changed so that especially larger, heavier parts like frames come by rail, parts are sourced closer and more use is made of water transport. Mexican parts are even funnier. We sourced wiring harnesses there and they had to be warehoused and checked here to see if they worked or not, the quality was that poor. Auto companies, especially the big three, are stupid dinosaurs, apply huge jolts of policy electricity soon!
Japan, which is the home of JIT, now has a network of ugly expressways. Horyuji temple near the ancient city of Nara is also near a big Nissan factory and the roads are clogged with trucks. So much for that contemplative feeling!
How are they saving gas if they are driving more miles. A truck idling is using less fuel than one which is moving since it is moving weight. Emissions also increase since the engine is operating at different RPMS plus it is using rubber on the wheels which is also bad for the environment.