Motivating and Monitoring JIT Supplier Performance

Measuring purchasing performance in an organization that utilizes a JIT system requires a broader view of quality than is the case in a non‐JIT operation. This article reports the results of a study which showed that experienced JIT managers track quality costs and their impact on scrap and rework, plant efficiency, and customer return costs, as well as on traditional incoming inspection costs. Forty‐six percent of the firms studied use some type of formal supplier evaluation system, and purchasing departments typically are evaluated on supply base management techniques involving lead‐time, delivery, quality, and inventory improvements.