The solution
Bose's problem was not only late material; it was the lag created by the normal buyer-to-sales-rep-to-factory chain. In 1986, United Printing joined Bose's JIT II experiment: Bose consolidated printing with one partner in exchange for immediate cost reduction, price ceilings and an in-plant representative.
The neat part was role design. The in-plant person had access to worldwide demand and inventory, placed orders, processed paperwork and searched for efficiencies. Inbound Logistics describes one spike at Bose's Mexico plant where the in-plant avoided a USD 45,000 rush print by borrowing inventory from Ireland until the revised material could be printed.
JIT II worked because it traded arm's-length bargaining for embedded planning. Bose did not simply ask suppliers to react faster; it let the supplier see the system early enough to prevent waste.
What it achieved
Move the supplier across the boundary
Why it worked
The in-plant representative collapsed buyer, salesperson and production planner into one trusted role.
Inventory visibility across plants let Bose satisfy a shortage by moving existing stock instead of buying obsolete material.
The supplier gained volume and access; Bose gained lower inventory and fewer emergencies, so the incentive was not one-sided.
What can be applied
When handoffs cause delay, the smart move can be to redraw the organizational boundary around the work, not to speed up the handoff.
Aftermath
Twelve years later, United Printing's in-plant still had an office in Bose's advertising department and the JIT II relationship was still operating. The broader JIT II idea was later discussed in National Productivity Review as an in-plant representative model used by Bose, Honeywell and AT&T.
FOLLOW THE EVIDENCE
The sources
- JIT II Partnerships Require Leap of Faith inboundlogistics.com
- The ultimate customer-supplier relationship at Bose, Honeywell, and AT&T onlinelibrary.wiley.com