Case Study: Maruti Suzuki’s JIT Implementation
Background & Philosophy
Japanese Manufacturing Culture: Maruti Suzuki, from its inception in 1981 as
a joint venture, embraced Japanese principles—Kaizen (continuous
improvement), multi-skilling, flat hierarchy, cleanliness, and participative
management. This cultural embedding differentiated it within India’s
automotive landscape.
Operational Discipline: The Gurgaon plant exemplifies this culture—spotless
floors, orderly tools, marked walkways, clean machinery—consistent with
Toyota-like lean standards.
JIT System & Supplier Ecosystem
Supplier Proximity and Collaboration
Local Supplier Network: Over 75–85% of Maruti’s suppliers are located within
a 100 km radius of the Gurgaon and Manesar plants—enabling frequent,
reliable deliveries and reducing lead times.
Supplier Support & Quality Circles: Maruti actively supports its vendors with
technology, financial help, and process improvements. It conducts Quality
Circle competitions—top performers even present at Suzuki facilities in Japan.
The e-Nagare System (Digital Pull Mechanism)
Evolution of JIT: Launched in 2004, e-Nagare—Japanese for “flow”—digitally
ties production schedules to suppliers via intranet. Vendors receive:
o Annual demand forecasts,
o Quarterly production plans,
o Firm fortnightly schedules,
o And precise daily delivery requirements 24 hours before the production
date.
Dynamic Delivery: Around 5% of vendors operate on “just hours” notice—
adjusting deliveries live to match assembly sequence (e.g., red sedan following
blue hatchback)—with zero tolerance for incorrect parts.
Results: Synchronization of material flow, leaner processes, minimized
inventory, and enhanced ability to deliver customized configurations.
Operational Impact & Metrics
Inventory Reduction: Implementation of e-Nagare enabled inventory inside
plants to drop by up to 70%, and material quotas reduced from one month to
just 15 days.
Efficiency Gains: The previous 30-hour production planning cycle was
shortened to just 2 hours via e-Nagare.
Drastic Productivity Improvements: Despite workforce reduction (from 6,700
to 4,500 employees), daily production increased—from 1,200 to 2,000 cars per
day.
Holistic Lean Practices: Combined with tools like Kanban, Kaizen, TQM, SPC,
Poka-Yoke, and Six Sigma (institutionalized in procedural standards via MACE),
Maruti advanced structural efficiency and quality.
Why It Works: Key Success Factors
1. Cultural Transformation: Japanese-style organizational discipline embedded
from the top-down.
2. Supplier Integration: Close physical and operational alignment with vendors
ensures agility.
3. Technology-Driven Pull System: e-Nagare’s date- and sequence-aware digital
scheduling keeps the supply chain tightly synchronized.
4. Continuous Improvement: Ground-level Kaizen drives incremental gains;
vendor competitions maintain high-quality momentum.
Summary Table
Focus Area Maruti Suzuki Approach Outcome/Benefit
75–85% within 100 km; vendor Short lead times, quality focus,
Supplier Setup
development & competitions innovation
Inventory cut, faster planning,
JIT Scheduling e-Nagare digital system
customized production
Inventory & From 30h to 2h; quotas down Reduced capital lock-in, leaner
Planning from 1 month to 15 days operations
Production Workforce reduction, output Higher productivity with lean
Focus Area Maruti Suzuki Approach Outcome/Benefit
Efficiency rise staffing
Lean Management Kaizen, Kanban, TQM, SPC, Organizational resilience,
Culture Poka-Yoke, MACE continuous waste elimination
Final Thoughts
Maruti Suzuki’s JIT case is more than streamlined logistics—it’s a blueprint for lean
transformation:
Start with culture: instill precision, cleanliness, and continuous improvement
early.
Build supplier ecosystems: proximity and mutual capability uplift enable JIT.
Leverage tech thoughtfully: tools like e-Nagare add visibility and agility.
Institutionalize improvement: embed systems like Kaizen and TQM to sustain
gains.
