NationMaster - Encyclopedia: Kanban

Kanban (in kanji 看板 also in katakana カンバン, where kan, 看カン, means "visual," and ban, 板バン, means "card" or "board") is a concept related to lean and just-in-time (JIT) production. (The Japanese word kanban is a common everyday term meaning "signboard" or "billboard" and utterly lacks the specialized meaning that this loanword has acquired in English.) According to Taiichi Ohno, the man credited with developing JIT, kanban is a means through which JIT is achieved.^[2] Image File history File links No higher resolution available. ... Image File history File links No higher resolution available. ... Lean manufacturing is a generic process management philosophy derived mostly from the Toyota Production System (TPS)[1] but also from other sources. ... For other uses, see Just In Time. ... A grammatically incorrect sign, posted at the back door of a pizza shop in Niagara Falls, Canada. ... Billboard redirects here. ... A loanword (or loan word) is a word directly taken into one language from another with little or no translation. ... Taiichi Ohno (å¤§é‡Ž è€ä¸€, February 29, 1912 - May 28, 1990) is considered to be the father of the Toyota Production System, also known as Just In Time or JIT. He has written several books about the system, the most popular of which is Toyota Production System: Beyond Large-Scale Production. ...

Kanban is a signaling system. As its name suggests, kanban historically uses cards to signal the need for an item. However, other devices such as plastic markers (kanban squares) or balls (often golf balls) or an empty part-transport trolley can also be used to trigger the movement, production, or supply of a unit in a factory.

It was out of a need to maintain the level of improvements that the kanban system was devised by Toyota. Kanban became an effective tool to support the running of the production system as a whole. In addition, it proved to be an excellent way for promoting improvements because restricting the number of kanban in circulation highlighted problem areas.^[3]

Origins

The term kanban describes an embellished wooden or metal sign which has often been reduced to become a trade mark or seal. Since the 17th century, this expression in the Japanese mercantile system has been as important to the merchants of Japan as military banners have been to the samurai. Visual puns, calligraphy and ingenious shapes — or kanban — define the trade and class of a business or tradesman. Often produced within rigid Confucian restrictions on size and color, the signs and seals are masterpieces of logo and symbol design. For example, sumo wrestlers, a symbol of strength, may be used as kanban on a pharmacy's sign to advertise a treatment for anemia. Contemporary Western Calligraphy. ... Confucianism (儒家 Pinyin: rújiā The School of the Scholars), sometimes translated as the School of Literati, is an East Asian ethical, religious and philosophical system originally developed from the teachings of Confucius. ... A sumo match Sumo (相撲 Sumō), or sumo wrestling, is today a competition contact sport wherein two wrestlers or rikishi face off in a circular area. ... This article discusses the medical condition. ...

In the late 1940s, Toyota was studying U.S. supermarkets with a view to applying some of their management techniques to their work. This interest came about because in a supermarket the customer can get what is needed at the time needed in the amount needed. The supermarket only stocks what it believes it will sell and the customer only takes what they need because future supply is assured. This led Toyota to view earlier processes, to that in focus, as a kind of store. The process goes to this store to get its needed components and the store then replenishes those components. It is the rate of this replenishment, which is controlled by kanban that gives the permission to produce. In 1953, Toyota applied this logic in their main plant machine shop.^[4]

The word first appeared in English around 1977 in the International Journal of Production Research.^[5]^, ^[6] Today, it is the most-common method for implementing just-in-time production.^[7]

Operation

With this in mind, it is not surprising that an important determinant of the relative merits of "push" and "pull" production scheduling is the quality of the demand forecast. Kanban is a pull system that determines the supply, or production, according to the actual demand of the customers. In contexts where demand is difficult to forecast, the best one can do is to respond quickly to observed demand. This is exactly what a kanban system does: it acts as a demand signal which immediately propagates through the entire chain. Push systems often encounter serious difficulties when demand forecasts turn out to be inaccurate. Where the response cannot be quick enough, e.g., significant lost sales or downstream production, then stock building may be appropriate by issuing more kanban. Taiichi Ohno states that kanban must follow strict rules of use,^[8] Toyota has six simple rules, and that close monitoring of these rules is a never-ending problem to ensure that kanban does what is required.

A simple example of the kanban system implementation might be a "three-bin system" for the supplied parts (where there is no in-house manufacturing) — one bin on the factory floor, one bin in the factory store and one bin at the suppliers' store. The bins usually have a removable card that contains the product details and other relevant information — the kanban card. When the bin on the shop floor is empty, the bin and kanban card are returned to the store. The store then replaces the bin on the factory floor with a full bin, which also contains a kanban card. The store then contacts the supplier and returns the now empty bin with its kanban card. The suppliers inbound product bin with its kanban card is then delivered into the factory store completing the final step to the system. Thus the process will never run out of product and could be described as a loop, providing the exact amount required, with only one spare so there will never be an issue of over-supply. This 'spare' bin allows for the uncertainty in supply, use and transport that are inherent in the system. The secret to a good kanban system is to calculate how many kanban cards are required for each product. Most factories using kanban use the coloured board system (Heijunka Box). This consists of a board created especially for holding the kanban cards. A heijunka box is a visual scheduling tool used in heijunka, a Japanese concept for achieving a smoother production flow. ...

Here is another example of kanban thinking: in the production of a widget, the operator has two shelves, one on either side of their workplace. The raw materials can be designated to arrive on one shelf and the finished articles placed on the other. These shelves can then be designated to act as kanbans. The outgoing kanban signals the customer's need so that when it is empty, the operator must produce another widget. Look up widget in Wiktionary, the free dictionary. ... material is the substance or matter from which something is or can be made, or also items needed for doing or creating something. ...

The kanban is sized so that it can only hold a fixed number of items decided by the customer needs (usually one). When the operator begins work, he takes the raw material from the incoming kanban, which when seen by the supplier, signals that the customer needs one more.

So, kanban can be said to have several basic principles: (1) only produce products to replace those consumed, (2) only produce products based on signals from consumers, and (3) containers must contain an identical number of parts.

The Kanban - JIT Connection

Kanban is directly related to Just-In-Time (JIT) delivery. However, Kanban is not a synonym for JIT. It is a part of a more encompassing JIT system. There is more to running a JIT system than just Kanban and there is more to Kanban than just managing inventory. Case in point, Kanban also involves industrial re-engineering. This requires that assembly areas might be rearranged from grouping machines by function, to creating "silos" of equipment and employees. The “silos” allow associated products to be manufactured in a continuous flow.

The Kanban philosophy has employees responsible for particular work activities. Teams and individuals are encouraged to participate in continuously improving the Kanban processes and the overall production process.

Kanban is a system not intended to be used alone, but is an integral part of Kaizen and 5S.^[9]

Implementation

The first step in implementing kanban usually involves the collection of data about the processes within a business. This will help determine which processes will work well with kanban.^[10]

After target processes are identified, the number of kanban containers to be used must be determined. Here is a formula for doing so:

Where k is the integer number of containers for a part, d is the expected daily demand for the part (in units), w is the average waiting time during the process plus materials handling time per container (in fractions of a day), p is the average processing time per container (in fractions of a day), c is the quantity in a container, and α is a variable that reflects the efficiency of the production of the part. Increasing alpha (α) increases safety stock.^[11] The integers are commonly denoted by the above symbol. ...

Another step in designing a kanban system is assigning individuals to handle kanban transactions and problems. Workers must also be trained in using the system and an implementation schedule is usually created. After implementing the kanban, audits may be performed and adjustments made. Some companies hire consultants to help with implementation. John Gross recommends starting simple and possibly implementing a pilot program in a part of the production facility satisfying a demand within a company.

A kanban board may also be used to track each kanban. This can electronically or manually adjusted. A way to automate tracking is by scanning bar codes on the containers.^[13]

Variations

There are variations of the system. For example, Toyota uses two cards: one for withdrawal and one for production.^[14] Other companies vary the number of items per container or the number of containers depending on the desired work-in-process inventory, safety stock, and the order quantity. Some companies use empty containers themselves as kanbans. This is called the container system. Others do away with containers, using painted boundaries to symbolize them.^[15] Extra stock to allow for uneven demand; a buffer. ...

Another Alternative Kanban Model

Kanban can also function like a supermarket. A limited stock of each component needed to build a widget is stored in a specific location with a fixed space allowance for each component. The widget assemblers come to the "supermarket" and collect the components needed. As components are removed from the shelf, a message is sent to a "regional warehouse" or component manufacturing facility, requesting that the components be replaced. The "supermarket" might then receive a daily shipment of replacement components, exactly replacing those that were used.

If the term of "supermarket" is exchanged for "warehouse," it becomes a manufacturing example.

This "supermarket" model differs from the first kanban example in that it would be used when components are manufactured in remote facilities, distant from the widget assembly plant. Instead of moving around small quantities of components, larger quantities are shipped once a day to the centralized warehouse.^[16]

Assessment

Advantages

Kanban can reduce inventory anywhere from 25 to 75 percent.^[17] Lower inventory reduces the risk of obsolescence and inventory-holding costs (e.g., insurance, heating, rent, etc.). Using kanban may also reduce the bullwhip phenomenon, where changes in the supply chain close to the consumer produce greater changes upstream. In order for kanban to function properly, other improvements must be made in business processes. For example, to ensure containers fulfill orders fully, scrap must be reduced. Maintenance must also be improved to eliminate downtime, as there is little or no safety stock.

Kanban reduces training costs by simplifying operations. It usually eliminates the need for a production schedule or MRP. MRP systems rely on forecasts and are labor as well as computer-intensive. Because of the computing involved, employees with computer-skills are needed. MRP systems can also be difficult to change.^[18] The initialism MRP or M.R.P. can stand for many things: Material requirements planning or Material resource planning and Manufacturing resource planning (MRP II) Maximum retail price Manufacturers recommended price Machine-readable passport Magnum rifle powder Lewis Machine & Tool Monolithic Rail Platform Major Research Paper Malware Removal and...

Kanban: Responsive to Customers

Kanban results in a production scheme that is highly responsive to customers. In the previous example, the production of widgets varies depending on the customer's needs. As the widget demand varies, so will the internal demand for widget components. Instead of trying to anticipate future demand of components and/or widgets (predicting the future is difficult), Kanban reacts to demands.

Kanban does not preclude existing material flow systems within a facility. Other systems such as Materials Requirement Planning (MRP) and Reorder Point (ROP) can remain in operation. Kanban is most beneficial when high-volume and low-value components are involved. For low-volume and high-value components, other materials-management systems may be a better option. ^[19]

Disadvantages

MRP systems can generally provide more statistics than kanban due to the planning they require. When there are long lead times involved, forecasts may be desirable. Further, the initial investment to implement kanban may be higher than any long-term cost reductions. Lead Time, in publishing, is a term for describing the amount of time that a journalist has between receiving a writing assignment, and submitting the completed piece. ...

References

^ Waldner, Jean-Baptiste (September, 1992). Principles of Computer-Integrated Manufacturing [1]. John Wiley & Sons, p128-p132. ISBN 047193450X.
^ Ohno, Taiichi (June 1988). Toyota Production System - beyond large-scale production. Productivity Press, 29. ISBN 0915299143.
^ Shingō, Shigeo (1989). A Study of the Toyota Production System from an Industrial Engineering Viewpoint. Productivity Press, 228. ISBN 0915299178.
^ Ohno, Taiichi (June 1988). Toyota Production System - beyond large-scale production. Productivity Press, 25-28. ISBN 0915299143.
^ International Journal of Production Research, vol. 15 (1977) p. 561
^ John Simpson, ed. "Kanban" Oxford English Dictionary, 2nd ed. (Oxford University Press, 1989)
^ Waters, C. D. J. Inventory Control and Management (John Wiley and Sons, 2003) p. 349
^ Ibid. p 30
^ Ibid.
^ John M. Gross and Kenneth R. McInnis. Kanban Made Simple: Demystifying and Applying Toyota's Legendary Manufacturing Process (AMACOM, 2003)
^ Lee J. Krajewski and Larry P. Ritzman. Operations Management: Strategy and Analysis. 6th ed. (Prentice Hall, 2002) pp. 807-810
^ Waters, op. cit., p. 353
^ Administering SAP R/3: The Production and Planning Module (Que, 2000) p. 403
^ NB: This method is very common (Waters 351).
^ Krajewski. op. cit. pp. 808-809
^ Hudgik, Steve. What is Kanban?. Retrieved on 2007-10-31.
^ Gross. Op. cit.
^ Ibid.
^ Hudgik. op. cit.

The Wiley Building in Hoboken, New Jersey, located on the waterfront between River Street and Frank Sinatra Drive. ... Taiichi Ohno (å¤§é‡Ž è€ä¸€, February 29, 1912 - May 28, 1990) is considered to be the father of the Toyota Production System, also known as Just In Time or JIT. He has written several books about the system, the most popular of which is Toyota Production System: Beyond Large-Scale Production. ... Taiichi Ohno (å¤§é‡Ž è€ä¸€, February 29, 1912 - May 28, 1990) is considered to be the father of the Toyota Production System, also known as Just In Time or JIT. He has written several books about the system, the most popular of which is Toyota Production System: Beyond Large-Scale Production. ... Year 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era in the 21st century. ... is the 304th day of the year (305th in leap years) in the Gregorian calendar. ...

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