Kanban) is a scheduling system for lean and just-in-time production. Kanban is a system
to control the logistical chain from a production point of view, and is not an inventory control
system. Kanban was developed by Taiichi Ohno, at Toyota, to find a system to improve and
maintain a high level of production. Kanban is one method through which JIT is achieved.
Kanban became an effective tool in support of running a production system as a whole,
and it proved to be an excellent way for promoting improvement. Problem areas were highlighted
by reducing the number of kanban in circulation. One of the main benefits of Kanban is to establish
an upper limit to the work in progress inventory, avoiding overloading of the manufacturing
system. Other systems with similar effect are for example CONWIP.
Origins In the late 1940s, Toyota started studying
supermarkets with the idea of applying store and shelf-stocking techniques to the factory
floor. In a supermarket, customers obtain the required quantity at the required time,
no more and no less. Furthermore, the supermarket stocks only what it expects to sell within
a given time frame, and customers take only what they need, since future supply is assured.
This observation led Toyota to view a process as being a customer of one or more preceding
processes, and the preceding processes are viewed as a kind of store. The "customer"
process goes to the store to obtain required components which in turn causes the store
to restock. Originally, as in supermarkets, signboards were used to guide "shopping" processes
to specific shopping locations within the store.
Kanban aligns inventory levels with actual consumption; a signal is sent to produce and
deliver a new shipment when material is consumed. These signals are tracked through the replenishment
cycle, bringing visibility to both the supplier and the buyer.
Kanban uses the rate of demand to control the rate of production, passing demand from
the end customer up through the chain of customer-store processes. In 1953, Toyota applied this logic
in their main plant machine shop. Operation
One important determinant of the success of production scheduling based on demand "pushing"
is the ability of the demand-forecast to receive such a "push". Kanban, by contrast, is part
of an approach where the "pull" comes from the demand. The supply or production is determined
according to the actual demand of the customers. In contexts where supply time is lengthy and
demand is difficult to forecast, often, the best one can do is to respond quickly to observed
demand. This situation is exactly what a kanban system accomplishes, in that it is used as
a demand signal that immediately travels through the supply chain. This ensures that intermediate
stocks held in the supply chain are better managed, and are usually smaller. Where the
supply response is not quick enough to meet actual demand fluctuations, thereby causing
significant lost sales, stock building may be deemed more appropriate, and is achieved
by placing more kanban in the system. Taiichi Ohno stated that to be effective,
kanban must follow strict rules of use. Toyota, for example, has six simple rules, and close
monitoring of these rules is a never-ending task, thereby ensuring that the kanban does
what is required. Toyota's Six Rules
Later process picks up the number of items indicated by the kanban at the earlier process.
Earlier process produces items in the quantity and sequence indicated by the kanban.
No items are made or transported without a kanban.
Always attach a kanban to the goods. Defective products are not sent on to the
subsequent process. The result is 100% defect-free goods.
Reducing the number of kanban increases the sensitivity.
Kanban cards Kanban cards are a key component of kanban
and signal the need to move materials within a manufacturing or production facility or
move materials from an outside supplier in to the production facility. The kanban card
is, in effect, a message that signals that there is a depletion of product, parts, or
inventory that, when received, the kanban will trigger the replenishment of that product,
part, or inventory. Consumption therefore drives demand for more production, and demand
for more product is signaled by the kanban card. Kanban cards therefore help create a
demand-driven system. It is widely held by proponents of lean production
and manufacturing that demand-driven systems lead to faster turnarounds in production and
lower inventory levels, thereby helping companies implementing such systems to be more competitive.
In the last few years, systems sending kanban signals electronically have become more widespread.
While this trend is leading to a reduction in the use of kanban cards in aggregate, it
is still common in modern lean production facilities to find widespread usage of kanban
cards. In Oracle ERP software, kanban is used for signalling demand to vendors through e-mail
notifications. When stock of a particular component is depleted by the quantity assigned
on kanban card, a "kanban trigger" is created, a purchase order is released with predefined
quantity for the vendor defined on the card, and the vendor is expected to dispatch material
within a specified lead time. Kanban cards, in keeping with the principles
of kanban, simply convey the need for more materials. A red card lying in an empty parts
cart conveys that more parts are needed. Three-bin system
An example of a simple kanban system implementation might be a "three-bin system" for the supplied
parts, where there is no in-house manufacturing. One bin is on the factory floor, one bin is
in the factory store, and one bin is at the supplier. The bins usually have a removable
card containing the product details and other relevant information — the classic kanban
card. When the bin on the factory floor is empty,
the empty bin and its kanban card are returned to the factory store. The factory store replaces
the empty bin on the factory floor with the full bin from the factory store, which also
contains a kanban card. The factory store sends the empty bin with its kanban card to
the supplier. The supplier's full product bin, with its kanban card, is delivered to
the factory store; the supplier keeps the empty bin. This is the final step in the process.
Thus, the process will never run out of product, and could be described as a closed loop in
that it provides the exact amount required, with only one spare bin so there will never
be an oversupply. This 'spare' bin allows for the uncertainties in supply, use, and
transport that are found in the inventory system.
The secret to a good kanban system is to calculate just enough kanban cards required for each
product. Most factories using kanban use the coloured board system. This slotted board
was created especially for holding the cards. Electronic kanban systems
Many manufacturers have implemented electronic kanban systems aka an "e-kanban system." These
help to eliminate common problems such as manual entry errors and lost cards. E-kanban
systems can be integrated into enterprise resource planning systems, enabling real-time
demand signaling across the supply chain and improved visibility. Data pulled from e-kanban
systems can be used to optimize inventory levels by better tracking supplier lead and
replenishment times. See also
Backflush accounting CONWIP
Material requirements planning Manufacturing resource planning
Scheduling Supply chain management
Drum-buffer-rope List of software development philosophies
Lean software development Visual control
Continuous-flow manufacturing Kanban board
Kanban References
Further reading Waldner, Jean-Baptiste. Principles of Computer-Integrated
Manufacturing. John Wiley & Sons. ISBN 0-471-93450-X. Louis, Raymond. Custom Kanban: Designing the
System to Meet the Needs of Your Environment. University Park, IL: Productivity Press. ISBN 978-1-56327-345-2.
Malakooti, B.. Operations and Production Systems with Multiple Objectives. John Wiley & Sons.
External links Toyota: Kanban System