Just-In-Time and Lean Concepts in New Areas

Michael Watson Ph.D Partner
Read Time: 1 minute apprx.
cars managerial analytics manufacturing personal finance

JIT (or “Just-in-time” and later morphed into being called Lean) started out as part of Toyota’s manufacturing strategy where parts were delivered to the assembly line just when needed.  This not only helped reduce the cost of the items, it also forced Toyota to be more disciplined and that led to even bigger savings.   The ideas of JIT spread from Toyota and helped transform the manufacturing sector.

The ideas of JIT and Lean spread from manufacturing to the service industry (like hospitals and back-office financial work) to software development.

It is interesting to see the concept pop up in new places.

Recently, a company called ActiveHours applied JIT idea to personal finance.  The ActiveHours app allows workers to access their wages right after they’ve worked.  So, if someone has just put in an 8-hour shift, they can log into ActiveHours and get paid for that shift without waiting for payday to roll around.  So, the money can now be made available just in time– or just-when-needed when a unexpected bill comes due.  Besides helping people manage their finances, it could have a noticeable impact on the economy– many retailers experience a big spike in sales on payday. This causes inefficiency in the retailer’s supply chain.  If the ActiveHours concept catches on and everyone is paid for every day they work, this could reduce the payday spike.