Basic Overview of Kanban
Learning about Kanban can be a great way to help improve just about any production process. While the word may sound odd to most people, the processes involved have been proven effective for nearly half a century. The concept was first developed at Toyota, and has now been accepted by thousands of companies as a best practice for logistic controls.
The word Kanban is Japanese and means billboard or signboard. It gets this name from the fact that some sort of signal (a sign or card) is used to trigger the production of specific things. The goal of the Kanban system is to provide a just-in-time solution to production demand. There are many important aspects of this lean manufacturing process, and the following are just a few key points.
Pull Focused System
One of the most important aspects of the Kanban methodology is that it is a pull based system. This means that rather than having products pushed along the assembly line and then sold to customers, a facility will have customer demand pull the actual production.
While Kanban is not an inventory management system, the fact that a company using this system properly should only create products when there is actual demand, it can help dramatically reduce the amount of inventory that is kept on the shelves. In fact, the whole system was developed after analyzing how supermarkets kept their shelves stocked without excessive waste.
Another important component of the Kanban system is the signal cards that are used. These cards can be actual physical cards, or more commonly today, lights or other electronic indicators. Whatever it actually is, the Kanban cards are displayed when the replenishment of a product, part or other inventory item is needed.
When done properly, only the right amount of any item will be brought into the area, so that it is not stored for a long time. Of course, you have to balance that out with making sure you don’t have to constantly travel back and forth to areas in order to get more stocking materials. This is one of the important parts of planning any new Kanban system.
Knowing Production Times
One of the most important parts of any effective Kanban systems is knowing the production times for anything that is made. By being able to accurately estimate how long it takes to make a specific product, you can better plan out your orders.
In addition to being able to better plan your orders, you can also plan out how much inventory is needed to be on hand, and when it is necessary to order more. If, for example, you can user 500 pieces per day of a specific item, and it takes an average of three days to replenish it, you will want to have about 1500 pieces on hand at all times.
Of course, each product and part will need to be individually analyzed for this so that everything in the facility runs smoothly. While this can take a lot of work up front, it will pay off well down the road once you have a Kanban system running smoothly.
Benefits of Kanban
There are many benefits of Kanban that facilities need to consider when implementing this program. One of the most important is that you won’t have excess stock of finished products. This means that you can manage your prices better and not have to lower prices to help keep your inventory levels where they belong.
It also helps to predict the need of parts and other items so that you can be sure to have them on hand when they are needed. Over time, this can provide significant savings by preventing downtime or delays.