Just in time vs. just in case

Just-In-Time (JIT) is an inventory management strategy and a core principle of Lean production. It focuses on receiving goods (raw materials, parts, or finished products) only as they are needed for production or delivery. The goal is to minimize inventory holding costs and waste, relying on efficient processes and reliable suppliers to ensure materials arrive "just in time."

Just-In-Case (JIC) is an inventory management strategy where a company keeps a large stock of inventory (raw materials, work-in-progress, or finished goods) on hand. This buffer stock is maintained to handle unexpected spikes in demand, potential supply chain disruptions (like delays or shortages), or unforeseen events. The primary focus is on ensuring supply reliability and avoiding stockouts, even if it means incurring higher storage costs.

The fundamental difference lies in the balance between **cost efficiency** and **risk mitigation**:

• **JIT** prioritizes efficiency, minimizing inventory and associated costs by relying on predictable processes and demand ("Lean and agile"). This saves money but can be vulnerable to disruptions.
• **JIC** prioritizes security and supply stability by holding buffer stock ("stockpiling"). This incurs higher costs (storage, obsolescence) but provides a cushion against uncertainty.

It's a trade-off between running lean with minimal buffer versus maintaining resilience with excess stock.

The choice depends heavily on the business context:

• **Choose JIT when:** Demand is stable and predictable, supply chains are highly reliable, lead times from suppliers are short and consistent, products are not subject to rapid obsolescence, and minimizing holding costs is a high priority.
• **Choose JIC (or a hybrid approach) when:** Demand is volatile or unpredictable, supply chains are prone to disruptions (natural disasters, geopolitical issues, supplier instability), lead times are long or variable, products are critical or essential, or avoiding stockouts at all costs is paramount (e.g., essential medical supplies).

Many businesses today use a hybrid approach, applying JIT principles where possible for efficiency but maintaining JIC buffers for critical or high-risk items or stages.