Comparison of JIT and ERP

[Abstract] for a modern enterprise in the implementation of JIT and ERP key issues in the enterprise, this article from the enterprise cost management, JIT production systems of meaning, risk prevention measures and the ERP system of risk analysis discusses four aspects to make comparisons. Enterprise understanding from a strategic level, the implementation of ERP, JIT. Finally, JIT and ERP, this paper analyzed and compared.

[Keywords:] JIT production systems and the cost of content management, ERP System risk analysis and Risk Strategy

I, JIT analysis

1, JIT production systems of meaning
Real-time production systems (Just-In-Time, has been translated into domestic short time JIT production system or in-time production system. Time production system produced in the 20th century, 70 years, was first introduced by the Japanese Toyota Motor Corporation as a production management system, Then in the Western developed countries like the United States, Canada, Western Europe and other countries have also been widely used. time production system is the point of production to customer needs (such as the order as a starting point, by the passage of time after the forward step by step to a comprehensive arrangements for the production task . what is produced on a production step, production number, quality requirements and delivery times can only be made based on the next steps in the production of specific requirements. This is from front to back with the traditional production system to promote the opposite. As for the materials and spare components, a step necessary only when an enterprise to be purchased. time production system, the main purpose is not to eliminate a variety of value-added operations for greater flexibility to adapt to the changing needs of the customer orders. This approach made zero defect production process, the slogan of zero inventory management process. To use the ideal time production system should continue to implement a series of improvement activities, to eliminate the production of no value in the work. time production system is characterized by a large can quickly amplitude to reduce costs and make delivery accuracy, thereby increasing the profitability of the enterprise. is the essence of real-time requirements of production systems for the production and marketing enterprises in the various links, as far as possible to achieve zero inventory.

Time production system can take to save the plant, reduce inventory stocks to increase the liquidity of the turnover, increase productivity, shorten the production cycle. Companies operating in the production occurred during the various operations, some customers may increase value, and some may not be able to increase customer value. not to increase customer value, operations can be regarded as a waste, for example, some related operations and inventory (inventory storage, maintenance, sorting, etc.) carried out by unqualified processing, transformation, raw materials, products, semi finished products quality loss for all aspects of production and marketing of various forms of waiting for the losses and delays. These are all non-value added work. is a waste. by real-time production systems, should try to eliminate or reduce non-value added operations and increase value added work, that is, by eliminating inefficiencies in the work to improve the productivity of enterprises, thereby reducing costs.

2, JIT environment, the product cost management

Compared with the traditional manufacturing system, in the JIT environment, there are some in the past for a variety of products, manufacturing costs, have been directly attributable to the specific product, modular manufacturing, comprehensive training for staff and decentralized service jobs not only the main features of JIT, but also to shift the cost of ownership of the reasons. In the past stored in the various departments scattered to produce a product of the device, and now were re-arranged in every unit, each unit only production of a product or part, so that depreciation of equipment becomes directly attributable costs. a multi-skilled workers and the decentralization of services, also increased the cost of belonging, the workers in the unit has been fully training, not only in equipment, preparation, maintenance and operation, and that between two machines can also act as handling the products, and previous work by other workers in the logistics services, as these cells are directly involved in the workers inside the product production, so the unit labor costs occurred is direct labor. Therefore, in the JIT environment, many previous indirect labor, and now can be directly attributable to the next in a product.

��. JIT on the accuracy of product cost. Indirect and direct costs to reduce the cost of promoting a product cost is correct. A product of direct manufacturing costs incurred directly attributable to the product; and indirect costs with a variety of products, and therefore should cost drivers and manufacturing cost rate assessed in a variety of products, but the allocation and various products in the calculation of the amount to be assessed will inevitably lead to errors. In order to calculate the exact cost and convenience, companies may choose to operations and manufacturing costs associated with less consumption of cost drivers, and JIT manufacturing not only to reduce overhead costs, but also most of the manufacturing costs to direct costs, thereby reducing the assessments to improve the correct degree of product costing. Note is, JIT not all of the indirect costs to direct costs, in fact, even with JIT, many manufacturing cost of operations for the manufacturing unit is still shared, and only when JIT manufacturing and operating costs when combined, can the accuracy of product costing a huge improvement.

��. JIT service sector allocation of the cost. In traditional manufacturing, the service sector and production sector of the manager is a different person as the service sector to Caiyong centralized support services for the production sector, the incidence of cost of services by the service department manager, and manager of production department cost of service despite the occurrence of a relationship, but it can only exert indirect control on the cost of services; in JIT environment, many services are taken to a decentralized, about skilled workers (such as engineers and production planners) directly assigned to the manufacturing unit, Bingdui trained workers to enable them to engage in the past by the indirect labor (eg, maintenance personnel) as the work of this, many service costs can be directly attributable to the manufacturing unit, and Finally, can also be attributed to specific products, which can allow managers to better understand the true costs of products, and because of its cost of services must be held directly control responsibilities, the cost of the services will be able to make more appropriate controls.

��. JIT on direct labor costs. When the manufacturers to use the JIT and automation, the direct labor costs would cause the number and nature of change. For example, workers within the manufacturing cell, the gap in the production of preventive maintenance in the period work, such action will produce two results: one is quantitative, direct labor, the proportion of the total manufacturing costs down; the other is in the nature, direct labor by the fixed costs into variable costs. And these two results direct labor costs will lead to the importance of collecting and reporting lower than in the past.

��. JIT on inventory valuation effect. JIT to eliminate the accounting problem is the first calculation of product cost and inventory valuation issues, the presence of inventory, in order to prepare financial statements, it is necessary in accordance with generally accepted accounting principles to be denominated in stock However, when there is zero inventory or only a small amount of stock, then the inventory valuation for financial statements does not matter, in fact, in the JIT environment, the purpose of calculating product cost only to management needs, managers need accurate cost information to decision-making.

��. JIT impact on the costing method. By batch costing product cost businesses in the implementation of JIT, you should first repetitive manufacturing operations and particularity of the order by opening, then you can set the manufacturing unit to deal with repetitive business, for those who demand is low, so no need to set up its manufacturing unit of product, different machines can be combined in a manufacturing unit within the same manufacturing process required for the production of a product or part family. As these changes in layout and production volume decreased (due to the reduction in progress and finished goods inventory results), for each batch of product had been set up costs alone does not seem practical, cost of manufacturing cell can follow the pool, which simplifies the calculation of cost of work in batches ; the same time as the basic idea of JIT production is demand-driven, which makes the product much shorter lead time, and the manufacturing unit of every product through the track is not easy, so in fact, JIT environment, the sub- approved cost method also has step by step nature.

��. JIT costing of the impact. In traditional costing, the production process is divided into relatively independent of the number of steps to the steps during the production of a semi-finished and finished products as cost objects, and the same manufacturing costs during the collection of the production steps, and then divided by the total cost during the production period, is the unit cost. unit costs in the semi-finished and finished goods in inventory valuation plays a significant role.

Although the simple calculation of unit costs, but because of the beginning and end of semi-finished products, which involves the manufacture of semi-finished and finished product costs are allocated between, so the term usually includes the calculation of a yield of finished products during the production and equivalent units, that is converted into semi-finished products on time of completion of the production of finished products. Since the calculation of equivalent units, as the weighted average method, or FIFO, depending on the calculation of unit costs thus quite complicated, especially under the FIFO method.

Since the implementation of JIT manufacturing inventory, so the calculation of unit costs is relatively simple, as long as a process within a certain period divided by the total cost of production, without having to calculate equivalent units, is also no need to consider the beginning of the cost of Therefore, JIT makes accounting much simpler.

Ii, ERP risk prevention measures in the enterprise ERP system, Research and risk analysis

ERP system is in English Enterprise Resource Planning (ERP) in short, it is by the famous American computer Technology consulting company Gartner Group (Gartner Group) concept put forward in 1990, which is based on computer Technology and the latest developments in management science from both theoretical and practical aspects, to management accounting as the core, while identifying and planning enterprise resource, all resources will be integrated within the enterprise, procurement, production, cost, inventory, distribution, transportation, finance, human resources planning to achieve the best combination of resources, to achieve the best efficiency, achieve business (as represented by the manufacturing sector) the overall business management solutions.

1, the implementation of ERP System risk analysis
��. Target is too high. In the development of ERP system project goals, the goals are too high for SMEs, potentially exaggerating the ERP system function. SMEs range of ERP system implementation is too large, from the actual business situation of enterprises and are have the resources, the lack of available resources within the enterprise objective evaluation, which are not realistic, not understand the ERP system, combined with the real business objectives at the blind horse, will inevitably arise in the implementation of a sense of loss, affecting the ERP system post-implementation.

��. Design out of line with the business. The whole selection process by the IT department is responsible for technical, computer technician-oriented business sector is not involved in selection. In the real environment, all sectors of business are very complex, ERP system, the application itself is closely related with the work of various departments, others do not understand your business and can not comment for you, only personally attended the selection process in order to fully understand the choice of ERP system to enable the department's business needs are met.

��. Too much faith in promises. Will not be able to build commitment as part of the system, that is not the system is built on top of any commitments, be prudent, as there is the commitment to carry out the selection and implementation of the system, only The successful implementation of the real, is the same truth.

��. Over the pursuit of new Technology. ERP system is software-based Technology products, but its goal is to manage their business, not to achieve a Technology, SMEs did not really understand this point. ERP system is not just a software system but a set of organizational models, business processes, business norms, information technology and implementation methods for the integrated management application system. over the pursuit of new technology, will only result in totally different, worth the candle.

Implementation of the ERP system also adapted to local conditions, as companies and other, specific issues and problems. First of all, according to the specific needs of the corresponding system, not generally have on the small machine, regardless of business size or Windows NT, so long operation of the dangers of a great enterprise. Second, this input is not a once and for all, as technology has developed rapidly, with the depth of work, businesses will feel more and more scarce resources, therefore, should be a corresponding investment in each year, to ensure the healthy functioning of the system.

Links to Research Papers Download http://www.hi138.com 2, Risk Strategies
��. Management team to reach a consensus
Enhancing strength, good management of the foundation work is the basis for the implementation of ERP systems. As the case of three failures revealed summary of ERP system is not so much a technical project, but rather that ERP system is a management change, only the self-possessed Adaptive management of change to the change in front of flexibility, and thus to the ERP system as a tool for self-use.

Management team attention, right thinking, clear thinking is to guarantee the successful implementation of ERP systems. ERP system implementation is known as "the number one project", which describes the decision makers in the ERP system implementation process of the special role. ERP system is a management system, affecting the overall situation, there is no top-level officials of the participation and empowerment, it is difficult to mobilize a whole.

��. On the correct understanding of ERP systems

ERP system is the backbone of the enterprise - whether internal or external - from the internal financial information and the effective integration of business performance data to future extended enterprise and collaborative commerce platform, which is the foundation for long-term development. Enterprises not only need to understanding of ERP system is what it does, but also understand the corporate ERP system implementation will bring what, and how will truly play the role of ERP systems and how the success of ERP system will really. To make the concept of senior management changes , the concept of change is the number one priority. to really make the implementation of ERP systems the number one project, the use of top-down, subtle way, the first high-level, middle managers first ideas, to the grassroots in the implementation of management and operational personnel indoctrination ERP systems of philosophy, so that enterprises may have access to and use of ERP systems on the ERP system, the concept of staff, have a good knowledge of the overall process of laying a solid ideological foundation.

��. Appropriate system to ensure that

Should ensure the success of ERP system implementation of institutional mechanisms. Strengthen the management, the interests of all sectors of adaptation, performance evaluation mechanism designed to mobilize the enthusiasm of the staff. Unfair distribution of benefits within the officer is a common problem enterprises, so they are in the interests of the points There is a balance, strengthen the performance assessment system to manage people and by not "in possession of people," to eliminate the internal sense of injustice, staff, improve staff's enthusiasm. whether ERP ϵͳ promoting or other projects Ye Hao, efforts will be more efficient and the implementation of the staff to get the understanding and support.

��. For the enterprise products

In doing needs analysis and feasibility analysis, based on the selected ERP system for the enterprise products. Departure from the enterprises themselves, take full account of the production lines and internal technical, economic and social factors on the feasibility of system implementation, to avoid riding a tiger . select the appropriate enterprise ERP system is the system that prerequisite for successful application in the enterprise. enterprises should start their own, in the full Research study, based on the introduction of a high starting point of the ERP system, and do a good job bidding, product selection must be based on the right.

��. Well system maintenance and upgrades

After the implementation of ERP systems, companies want to keep the team's main technical and operational staff, well after the implementation of system maintenance and a smooth upgrade work to do to further improve business productivity solid backing. ERP system implementation is not the end of completion, and is another new starting point. In general, ERP system, application life cycle expected in 10 to 20 years in the coming years, companies have to rely on the ERP system implementation team of engineers and business people improve the system to handle applications bottlenecks in order to adapt to new social changes and progress. improve the management level of enterprises in the exploration should be endless.

Iii, the conclusion

Comprehensive discussion available on the following conclusions: in the design and optimization of integrated supply chain information sharing mechanism, if the supplier considers the ability to timely supply incentives, the principal (manufacturer's risk costs, agency costs better than none consider the supplier's ability to timely supply to the small excitation. Therefore, to enhance the integration of all aspects of the supply chain level of income, reducing the risk of all aspects of cost and agency costs, should actively promote the establishment of an integrated supply chain information sharing incentives. or even longer period of time now, some SMEs in the implementation process of ERP systems have encountered some problems being encountered resistance, but have reason to believe that the ERP system implementation in the SME case of deepening , understand the nature of the problem in context, constantly sum up experience of success and failure cases, many small and medium enterprises in China will usher in the golden age of ERP system implementation, generally enhance the core competitiveness of enterprises, the rapid development and expansion of self, prosperous China .

References:

1, Yu Yanqiong, Fermi WONG, Ge stars. ERP system effectiveness of the application of dynamic assessment. Industrial Technology & Economy, 2005, (01).

2, Min Qing Fei. Chinese enterprise ERP system implementation of the key success factors. Dalian University of Technology, 2005 Edition

3. Litian Min. Management accounting Research. Lixin Accounting Press, 1996

4. Wang Zhuang. Modern cost management. Lixin Accounting Press, 1996 (1)

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