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The Kanban System
The original Kanban system is believed to
have been developed by Toyota in the early stages of what
we would call its JIT improvement campaign. The particular
feature of a Kanban system is that it short-circuits normal
ordering procedures: as supplies of a Kanban-controlled
material are used up, new supplies are requested simply
by releasing a re-order card which is sent direct to the
supply point (i.e. the manufacturer or stockists). It is
often described as a ‘pull’ system, in contrast with traditional
ordering procedures, which ‘push’ orders into the system.
The term ‘Kanban’ comes from the Japanese
language, in which Kanban simply means ‘card’. Somehow,
the word Kanban seems to have caught imagination of manufacturing
people in the Western World, even on the shop floor, and
today it is often used to describe simplified ordering systems
which a Japanese terminology in manufacturing companies
in the Western world, even if the interpretation isn’t quite
true to the original! However, in this section I shall stick
to the true meaning of Kanban, the other types of application
being covered in the next section, on improving the performance
of suppliers.
To explain the Kanban concept, consider the
case of an assembler who is drawing a particular component
from a pallet which, when full, contains 100 pieces. As
the last piece is drawn, the assembler takes an identifying
card from the empty pallet and sends it back down the line
to the earlier work centre where that part (among others)
is made. On receiving the Kanban card, the work centre responsible
for supplying the component makes a new batch of 100 and
sends it to the assembly post ( so that the assembler isn’t
kept waiting, there will probably be an extra pallet in
the system to maintain the supply while the new batch is
being made). This means that there is a minimum of paperwork,
and the order cycle is generated on a ‘pull’ basis, the
components only being made when there is an immediate need
for them, thus keeping work-in-progress to a minimum. If
you are familiar with the ‘two-bin’ method of stock control
you will recognize the similarity.
Since the procedure was first introduced at
Toyota, a number of variants have been introduced (the explanation
in the previous paragraph was based on the second variant,
the 1 card Kanban):
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The 2 card Kanban: this is the original
Toyota method, developed at a time when replenishment
supplies were routed through a component or parts store
(though it can also be used when no stores intervention
is involved). The card released by the user authorizes
the stores to ‘move’ a replenishment supply to the user.
When they do so, a second card, which is found on the
pallet they are about to supply, is removed and sent to
the component supplier as authority to ‘produce’ another
standard quantity.
- The 1 card Kanban: similar to the 2-card system, but
a single card acts as both ‘move’ and ‘produce’ authority.
This method is typically used where the supply point is
close to the user point, so that the supply and user operatives
move the empty and full pallets between the two work centers
themselves without the intervention of a stores function.
It is also commonly used where the movement of pallets is
automated.
- The container-based Kanban: in this variant the Kanban
card is dispensed with altogether. Instead, there are a
predetermined number of containers or pallets in the system,
all uniquely identified to a particular part number or component:
if the maker of the component has an empty container waiting
he or she fills it; if there is no empty container waiting,
then the operator must stop production of that component
and switch to some other task. This procedure is often used
when special-purpose containers or pallets are provided,
so that there is no doubt as to which components have to
go into them. However, it is also possible to use multipurpose
containers in what is in effect a cross between the container-based
and the 1 card systems, by painting the appropriate part
number and standard quantity on the containers itself. Another
useful technique is to paint containers for similar parts
in different colours, so that operators can identify the
right container easily.
-
The shelf-space Kanban: anyone who has
used a motorway cafeteria will be familiar with this method.
At the cafeteria counter a range of dishes is provided
to the customer via a display/dispensing cabinet, which
is subdivided into a number of ‘pigeon-holes’, each providing
one compartment for each type of dish. The instructions
to the kitchen staff are ‘ensure that there is always
at least one and not more than three of each type of dish
available in the cabinet. If there are three dishes available
of all types of dish, stop producing and find something
else to do (like cleaning your equipment)’. The same principle,
applied to the factory, takes the form of shelf spaces
marked up with the part number/description of different
parts. Someone is given the task of making sure that empty
shelf places are filled. When all spaces are filled, production
of the item stops.
-
The floor grid Kanban: exactly the same
as a shelf-space Kanban, but typically used for bulky
or heavy components which are unsuitable for putting on
shelves.
In all the above examples of Kanban, an essential
feature of the system is that the number of containers or
locations is systematically reduced by management to the
point where supply is kept just in balance with the rate
of use, so that the replenishment supply arrives ‘just-in-time’
for the user. The usual way of doing this is to keep taking
away one more container each day (or week) until you reach
the point where production is interrupted because the next
full container doesn’t arrive in time (i.e. it’s ‘just-too-late’!);
replacing one container should then bring the supply back
into balance with the rate of use. If you use this method,
make sure you keep one or two full containers somewhere
out of sight, ready to slip into the line quickly so that
the interruption to production doesn’t cause a problem.
This trial and error method of finding out how many Kanban
containers are needed is popular because in practice Kanban
are usually introduced gradually, in parallel with the old
method of supply; if the same containers are used as previously,
some will become surplus to requirements anyway when the
faster Kanban supply is implemented, so you might as well
take advantage of this to reduce the number in use gradually,
in the way described.
If this trial and error method worries you,
or if you’ve decided to buy a new type of container for
your Kanbans, there is a way of working out in advance exactly
how many containers will be needed; using a ‘simulation’
model will enable you to test the effects of different demand
levels and a different mix of production with a high degree
of confidence. You can find more information about simulation
techniques in the article for Reducing Risks Of Change.
From the above you will realize that Kanban
is not just another name for just-in-time, as some people
have suggested: it is only part of a JIT implementation.
The ‘true’ Kanban system is normally only suitable for high
turnover components, which are in regular use, and you should
generally avoid using Kanbans on high-cost components. However,
you can get some of the benefits of a Kanban system, even
with high-cost components, by using the shelf-space or floor
grid method in conjunction with the ‘scheduled contracts’
method, described in the next section: the example of a
fax call-off form, referred to there and illustrated in
Fig. 8, is used by Vokes Limited in conjunction with a floor
grid Kanban system for arranging twice-weekly deliveries
of large rolls of filtration material. This method has enabled
them to simplify ordering procedures, cut lead-time from
four weeks to a few days, and do away with the bulk stores
previously held.
If you decide to use the Kanban concept in
your own factory, don’t constrain yourself by trying to
conform too rigidly to what I have referred to as the ‘true’
Kanban system. Be flexible: adapt the basic concept to your
own circumstances in whatever way you think appropriate,
remembering that the prime considerations are minimizing
material and work-in-progress stocks, simplifying re-ordering
paperwork, and empowering the actual users of the material
to call for supplies as and when they need them.
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