Lean manufacturing creates a pull effect on production because it involves producing goods in response to customer demands, and obtaining inventory only when you need it, and in the amount you need. A tool you can use to respond to customer pull is Kanban.

Kanban is a Japanese word meaning "signal" or "instruction card." You use Kanbans in the form of empty containers, printed cards, or electronic signals to communicate what you need to replenish inventory or production materials. The signals show the part you need to purchase, and when and how much of it to buy. In this way, usage controls replenishment because materials are only pulled through the system when a preceding process signals that the next process requires materials.

It is important to understand that Kanban is a (visual) control system -- not a scheduling system. A Kanban system should be easy to understand, simple to visualize, and relatively easy to set up. Kanban systems are most commonly used within industries/companies where there is a stable demand and flow.

Calculating the number of Kanban cards required :

Number of Kanbans = (Demand in period x Demand Cycle time x Safety stock) Batch size (or container quantity)

Three types of signal cards indicate replenishment requirements:

    Withdrawal Kanbans (or W-Kanbans) These are printed cards that specify the type and quantity of product that you should obtain from a preceding production process or from storage when you require it. They authorize downstream "get" actions from upstream production processes, and may also signify that a part has moved.
    production Kanbans (or P-Kanbans) These are printed cards that specify the type and quantity of product a preceding process must produce to replenish what is consumed. They authorize upstream "produce" actions to replace downstream products that customers have taken.
    signal Kanbans (or triangle Kanbans) These are triangular printed cards that indicate that you need to replenish a particular raw material. They authorize upstream "reorder" actions, and tell the supplier how many units the production process has pulled from the raw material inventory.
    Emergency or Rush Kanban An emergency Kanban provides a way for rush work to be done. If a specific request/service/document/item is to be rushed through the process, then it has to be given and shown priority in some way. This could, for example, be routinely achieved with differently colored Kanban cards Red is a common one.
  • A Kanban signal is only issued when the item/work it represents is used.
  • No Kanban, no new item (i.e. items/services/documents/etc. are only provided, made, or issued when a Kanban exists).
  • Only good items/services/documents/etc are issued.
  • No over-production.
  • Items/services/documents/etc are only made in the order that the Kanban cards are received (except for emergency/rush Kanbans).
  • The number of Kanban cards should be reduced over time, and the problems that are encountered by doing this should be tackled as they are exposed.
  • Kanban systems
    You can implement three different types of Kanban systems, or material-handling methodologies:

      In-Process This system consists of a visible signal that you place on the downstream side of an operation to indicate to an upstream operation that it's time to produce the next item in the production sequence. It helps to maintain the correct production sequence because manufacturing takes place in the order in which you receive customer requirements.
      Single-card This system is a two bin material replenishment strategy that uses empty containers to indicate a replenishment cycle. You use two equally sized bins containing the same amount of material at the point of consumption. When the first container empties, it becomes a signal to replenish material. While you are replenishing the first container, you use the material from the second container to provide the required material for continued manufacturing. By the time the material in the second container is consumed, the first container returns from replenishment.
      Multiple-card This system is a material replenishment methodology that uses a collection of a predetermined number of withdrawal and production cards to indicate the need for a replenishment cycle and to initiate a machine setup. Once you have collected the multiple cards at an accumulation point, you use a "wait/work" sequencing board to keep track of the withdrawal and production signals and establish a production order, based on consumption.

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