Kanban Board Example
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Kanban (
Japanese Japanese may refer to: * Something from or related to Japan, an island country in East Asia * Japanese language, spoken mainly in Japan * Japanese people, the ethnic group that identifies with Japan through ancestry or culture ** Japanese diaspor ...
: カンバン and
Chinese Chinese can refer to: * Something related to China * Chinese people, people of Chinese nationality, citizenship, and/or ethnicity **''Zhonghua minzu'', the supra-ethnic concept of the Chinese nation ** List of ethnic groups in China, people of va ...
: 看板, meaning
signboard Signage is the design or use of signs and symbols to communicate a message. A signage also means signs ''collectively'' or being considered as a group. The term ''signage'' is documented to have been popularized in 1975 to 1980. Signs are any ...
or
billboard A billboard (also called a hoarding in the UK and many other parts of the world) is a large outdoor advertising structure (a billing board), typically found in high-traffic areas such as alongside busy roads. Billboards present large advertise ...
) is a
scheduling A schedule or a timetable, as a basic time-management tool, consists of a list of times at which possible task (project management), tasks, events, or actions are intended to take place, or of a sequence of events in the chronological order ...
system for
lean manufacturing Lean manufacturing is a production method aimed primarily at reducing times within the production system as well as response times from suppliers and to customers. It is closely related to another concept called just-in-time manufacturing ( ...
(also called just-in-time manufacturing, abbreviated JIT).
Taiichi Ohno was a Japanese industrial engineer and businessman. He is considered to be the father of the Toyota Production System, which inspired Lean Manufacturing in the U.S. He devised the seven wastes (or muda in Japanese) as part of this system. He wro ...
, an
industrial engineer Industrial engineering is an engineering profession that is concerned with the optimization of complex processes, systems, or organizations by developing, improving and implementing integrated systems of people, money, knowledge, information a ...
at
Toyota is a Japanese multinational automotive manufacturer headquartered in Toyota City, Aichi, Japan. It was founded by Kiichiro Toyoda and incorporated on . Toyota is one of the largest automobile manufacturers in the world, producing about 10 ...
, developed kanban to improve manufacturing efficiency. The system takes its name from the cards that track production within a factory. Kanban is also known as the ''Toyota nameplate system'' in the automotive industry. Kanban became an effective tool to support running a production system as a whole, and an excellent way to promote improvement. Problem areas are highlighted by measuring lead time and cycle time of the full process and process steps. One of the main benefits of kanban is to establish an upper limit to
work in process Work in process (WIP), work in progress (WIP), goods in process, or in-process inventory refers to a company's partially finished goods waiting for completion and eventual sale, or the value of these items. The term is used in supply chain managem ...
(commonly referred as "WIP") inventory to avoid overcapacity. Other systems with similar effect exist, for example
CONWIP CONWIP (CONstant work in process) are pull-oriented production control systems. Such systems can be classified as pull and push systems (Spearman et al. 1990). In a push system, the production order is scheduled, and the material is pushed into th ...
. A systematic study of various configurations of kanban systems, such as Generalized Kanban or Production Authorization Card (PAC) and Extended Kanban, of which CONWIP is an important special case, can be found in Tayur (1993), and more recently Liberopoulos and Dallery (2000), among other papers. A goal of the kanban system is to limit the buildup of excess inventory at any point in production. Limits on the number of items waiting at supply points are established and then reduced as inefficiencies are identified and removed. Whenever a limit is exceeded, this points to an inefficiency that should be addressed.


Origins

The system originates from the simplest visual stock replenishment signaling system, an empty box. This was first developed in the UK factories producing
Spitfires The Supermarine Spitfire is a British single-seat fighter aircraft used by the Royal Air Force and other Allied countries before, during, and after World War II. Many variants of the Spitfire were built, from the Mk 1 to the Rolls-Royce Griff ...
during the
Second World War World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposin ...
, and was known as the “two bin system.” In the late 1940s, Toyota started studying
supermarket A supermarket is a self-service Retail#Types of outlets, shop offering a wide variety of food, Drink, beverages and Household goods, household products, organized into sections. This kind of store is larger and has a wider selection than earli ...
s with the idea of applying shelf-stocking techniques to the factory floor. In a supermarket, customers generally retrieve what they need at the required time—no more, no less. Furthermore, the supermarket stocks only what it expects to sell in a given time, and customers take only what they need, because future supply is assured. This observation led Toyota to view a process as being a customer of one or more preceding processes and to view the preceding processes as a kind of store. Kanban aligns inventory levels with actual consumption. A signal tells a supplier to produce and deliver a new shipment when a material is consumed. This
signal In signal processing, a signal is a function that conveys information about a phenomenon. Any quantity that can vary over space or time can be used as a signal to share messages between observers. The ''IEEE Transactions on Signal Processing'' ...
is tracked through the replenishment cycle, bringing visibility to the supplier, consumer, and 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

A key indicator of the success of production scheduling based on demand, ''pushing,'' is the ability of the demand-forecast to create such a ''
push Push may refer to: Music * Mike Dierickx (born 1973), a Belgian producer also known as Push Albums * ''Push'' (Bros album), 1988 * ''Push'' (Gruntruck album), 1992 * ''Push'' (Jacky Terrasson album), 2010 Songs * "Push" (Enrique Iglesias s ...
''. Kanban, by contrast, is part of an approach where the ''pull'' comes from demand and products are
made to order Build to Order (BTO: sometimes referred to as Make to Order or Made to Order (MTO)) is a production approach where products are not built until a confirmed order for products is received. Thus, the end consumer determines the time and number of ...
. Re-supply or production is determined according to customer orders. 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 stock 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 potential lost sales, a 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

Toyota is a Japanese multinational automotive manufacturer headquartered in Toyota City, Aichi, Japan. It was founded by Kiichiro Toyoda and incorporated on . Toyota is one of the largest automobile manufacturers in the world, producing about 10 ...
has formulated six rules for the application of kanban: # Each process issues requests (kanban) to its suppliers when it consumes its supplies. # Each process produces according to the quantity and sequence of incoming requests. # No items are made or transported without a request. # The request associated with an item is always attached to it. # Processes must not send out defective items, to ensure that the finished products will be defect-free. # Limiting the number of pending requests makes the process more sensitive and reveals inefficiencies.


Kanban (cards)

Kanban cards are a key component of kanban and they signal the need to move materials within a production facility or to move materials from an outside supplier into the production facility. The kanban card is, in effect, a message that signals a depletion of product, parts, or inventory. When received, the kanban triggers replenishment of that product, part, or inventory. Consumption, therefore, drives demand for more production, and the kanban card signals demand for more product—so kanban cards help create a demand-driven system. It is widely held by proponents of
lean production Lean manufacturing is a production method aimed primarily at reducing times within the production system as well as response times from suppliers and to customers. It is closely related to another concept called just-in-time manufacturing (J ...
and manufacturing that demand-driven systems lead to faster turnarounds in production and lower inventory levels, helping companies implementing such systems 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 the use of kanban cards. In various software systems, kanban is used for signalling demand to suppliers through email notifications. When stock of a particular component is depleted by the quantity assigned on kanban card, a "kanban trigger" is created (which may be manual or automatic), a purchase order is released with predefined quantity for the supplier defined on the card, and the supplier 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 is a "three-bin system" for the supplied parts, where there is no in-house manufacturing. One bin is on the factory floor (the initial demand point), one bin is in the factory store (the inventory control point), 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 (because the parts in it were used up in a manufacturing process), the empty bin and its kanban card are returned to the factory store (the inventory control point). 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 never runs 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 is never oversupply. This 'spare' bin allows for uncertainties in supply, use, and transport in the inventory system. A good kanban system calculates just enough kanban cards for each product. Most factories that use kanban use the colored board system (
heijunka box A heijunka box is a visual scheduling tool used in heijunka, a method originally created by Toyota for achieving a smoother production flow. While heijunka is the smoothing of production, the heijunka box is the name of a specific tool used in ach ...
).


Electronic kanban

Many manufacturers have implemented electronic kanban (sometimes referred to as e-kanban) systems. These help to eliminate common problems such as manual entry errors and lost cards. E-kanban systems can be integrated into
enterprise resource planning Enterprise resource planning (ERP) is the integrated management of main business processes, often in real time and mediated by software and technology. ERP is usually referred to as a category of Business management tools, business management ...
(ERP) 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. E-kanban is a signaling system that uses a mix of technology to trigger the movement of materials within a manufacturing or production facility. Electronic kanban differs from traditional kanban in using technology to replace traditional elements like kanban cards with
barcode A barcode or bar code is a method of representing data in a visual, machine-readable form. Initially, barcodes represented data by varying the widths, spacings and sizes of parallel lines. These barcodes, now commonly referred to as linear or o ...
s and electronic messages like
email Electronic mail (email or e-mail) is a method of exchanging messages ("mail") between people using electronic devices. Email was thus conceived as the electronic ( digital) version of, or counterpart to, mail, at a time when "mail" meant ...
or electronic data interchange. A typical electronic kanban system marks inventory with barcodes, which workers scan at various stages of the manufacturing process to signal usage. The scans relay messages to internal/external stores to ensure the restocking of products. Electronic kanban often uses the Internet as a method of routing messages to external suppliers and as a means to allow a real-time view of inventory, via a portal, throughout the supply chain. Organizations like the
Ford Motor Company Ford Motor Company (commonly known as Ford) is an American multinational automobile manufacturer headquartered in Dearborn, Michigan, United States. It was founded by Henry Ford and incorporated on June 16, 1903. The company sells automobi ...
and
Bombardier Aerospace Bombardier Aviation is a division of Bombardier Inc. It is headquartered in Dorval, Quebec, Canada. Its most popular aircraft included the Dash 8 Series 400, CRJ100/200/440, and CRJ700/900/1000 lines of regional airliners, and the newer CS ...
have used electronic kanban systems to improve processes. Systems are now widespread from single solutions or bolt on modules to
ERP system Enterprise resource planning (ERP) is the integrated management of main business processes, often in real time and mediated by software and technology. ERP is usually referred to as a category of Business management tools, business management ...
s.


Types of kanban systems

In a kanban system, adjacent upstream and downstream workstations communicate with each other through their cards, where each container has a kanban associated with it.
Economic Order Quantity Economic Order Quantity (EOQ), also known as Economic Buying Quantity (EPQ), is the order quantity that minimizes the total holding costs and ordering costs in inventory management. It is one of the oldest classical production scheduling models. Th ...
is important. The two most important types of kanbans are: * Production (P) Kanban: A P-kanban, when received, authorizes the workstation to produce a fixed amount of products. The P-kanban is carried on the containers that are associated with it. * Transportation (T) Kanban: A T-kanban authorizes the transportation of the full container to the downstream workstation. The T-kanban is also carried on the containers that are associated with the transportation to move through the loop again. The Kanban philosophy and Task Boards are also used in Agile project management to coordinate tasks in project teams. An online demonstration can be seen in an Agile simulator. Implementation of kanban can be described in the following manner: * The workflow consists of logical steps. * There are two steps to a workflow viz. queue and work in progress/process. * The team in charge decides on the maximum amount of work each step of the workflow can hold. * Work is pushed into the queue step and pulled into the process step. * If need be, work is halted in two successive stages to clear bottleneck.


Kanbrain

A third type involves
corporate training Training and development involve improving the effectiveness of organizations and the individuals and teams within them. Training may be viewed as related to immediate changes in organizational effectiveness via organized instruction, while devel ...
. Following the just-in-time principle, computer-based training permits those who need to learn a skill to do so when the need arises, rather than take courses and lose the effectiveness of what they've learned from lack of practice.


See also

*
Backflush accounting Backflush accounting is a subset of management accounting focused on types of "postproduction issuing;" It is a product costing approach, used in a Just-In-Time (JIT) operating environment, in which costing is delayed until goods are finished. Ba ...
*
CONWIP CONWIP (CONstant work in process) are pull-oriented production control systems. Such systems can be classified as pull and push systems (Spearman et al. 1990). In a push system, the production order is scheduled, and the material is pushed into th ...
*
Material requirements planning Material requirements planning (MRP) is a production planning, scheduling, and inventory control system used to manage manufacturing processes. Most MRP systems are software-based, but it is possible to conduct MRP by hand as well. An MRP system ...
*
Manufacturing resource planning Manufacturing resource planning (MRP II) is defined as a method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning, and has a simulation capability to a ...
*
Scheduling (production processes) Scheduling is the process of arranging, controlling and optimizing work and workloads in a production process or manufacturing process. Scheduling is used to allocate plant and machinery resources, plan human resources, plan production processes an ...
*
Supply chain management In commerce, supply chain management (SCM) is the management of the flow of goods and services including all processes that transform raw materials into final products between businesses and locations. This can include the movement and stor ...
* Drum-buffer-rope *
List of software development philosophies This is a list of approaches, styles, methodologies, philosophies in software development and engineering. It also contains programming paradigms, software development methodologies, software development processes, and single practices, principle ...
*
Lean software development Lean software development is a translation of lean manufacturing principles and practices to the software development domain. Adapted from the Toyota Production System, it is emerging with the support of a pro-lean subculture within the agil ...
* Visual control *
Continuous-flow manufacturing Continuous-flow manufacturing, or repetitive-flow manufacturing, is an approach to discrete manufacturing that contrasts with batch production. It is associated with a just-in-time and kanban production approach, and calls for an ongoing exami ...
*
Kanban (development) Kanban (Japanese: , meaning signboard or billboard) is a lean method to manage and improve work across human systems. This approach aims to manage work by balancing demands with available capacity, and by improving the handling of system-lev ...
*
Just-in-time manufacturing Lean manufacturing is a production method aimed primarily at reducing times within the production system as well as response times from suppliers and to customers. It is closely related to another concept called just-in-time manufacturing (J ...
*
Lean manufacturing Lean manufacturing is a production method aimed primarily at reducing times within the production system as well as response times from suppliers and to customers. It is closely related to another concept called just-in-time manufacturing ( ...


References


Further reading

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External links


Toyota: Kanban System

Lean Lab: How to Calculate the number of Kanban
{{Authority control Japanese business terms Lean manufacturing Business terms Enterprise resource planning terminology