The Buyer‐Seller Linkage in a Just‐in‐Time Environment

The objective of this article is to describe the basic elements of the JIT system, and to propose certain behavioral and logistical dimensions of the buyer-seller linkage which are believed to be impacted by the adoption of the system by original equipment manufacturers (OEM); and to present the results of an empirical study designed to measure the present level of adoption of this just-in-time system in the automotive industry.

Abstract

An increasing number of manufacturing firms are developing and implementing just‐in‐time (JIT) systems. A unique feature of a JIT system is the new partnership philosophy of the buyer‐seller organizations, which is essential to its successful implementation. This article is based on the results of an empirical study of OEM adopters of the JIT concept. It demonstrates the dramatic effect of the system on traditional buyer‐seller practices, measures the performance results to date, and points up the key role of purchasing and materials management in developing successful buyer‐seller JIT linkages.