Success Principle Kanban

Kanban is a concept for an economic production control that many notable companies around the world use nowadays. The basic principles were developed a long time ago already by the Toyota Company in Japan. The Japanese word “Kanban” is translated as display- or pendulum-flap. The central idea behind LEAN production is the design of a value chain as a continuous process. However, there are always points in value streams where no constant flow production is possible and therefore production has to proceed in form of lot sizes. Reasons for this may be very long or short cycle times, particularly distant work places, or very unreliable processes. This is where the Kanban System is employed.

How does the Principle work?

Kanban reduces work in progress and finished products. Thereby, it reduces capital commitment and waste caused by inventory. Inventory is limited, so that surpassing the predetermined inventory is impossible, the flexibility towards fluctuated demand from customers is increased and production control is drastically simplified. Generally, not even an IT system is necessary: Cards, planning boards and discipline are sufficient. The Kanban-operation is also referred to as the supermarket principle due to its analog function: A customer takes a pre-produced item with no customer relation from the shelf. The supermarket’s operator restocks the removed quantity. For the production, this means: Planning interference is only necessary regarding the required stock quantity and the order point. Thereby, planning and operational actions in the daily workings are reduced to a minimum. The processes are interconnected through a buffer stock, in which the supplier provides produced items and from which the customer takes items. Kanban replaces the conventional order control with consumption control by making a self-regulating control loop out of two successive processes. The control loop is made up out of a process of items being consumed, the customer, and an upstream process producing the items, the supplier. The Kanban-card serves as order documentation here.

If the customer process receives an order for the production of a product, a corresponding item is retrieved from the buffer stock. The resulting gap then has to be filled by the supply process. KANBAN-cards attached to the items or item containers serve as production orders. When an item is removed from the buffer storage, the corresponding card is sent from there to the to the supplier. The cards circulate in a control loop. This method is called “Card-Kanban”. Depending on the requirements, different Kanban types are used: Traffic Light-Kanban, Container-Kanban, Dual Circuit-Kanban.

Advantages of the Kanban-Process

Especially medium-sized companies have realised that not only homogenous production profits from a Kanban-Control. With the correct means, advantages in productivity and speed can also be successfully realised in cases with a greater amount of variance. There, the central means of organisation is a planning board, also known as Dispo- and Kanban-Board. It offers both planners and employees equally the opportunity to get a comprehensive overview over demand and reserve, as well as controlling their workflow themselves.

The Kanban planning board is designed specifically for the company, but its operating mode is always similar: The cards are placed into pockets, sorted by rows and columns. These card pockets are often divided into traffic light colours. The cards are sorted, starting with the green pockets. Once the first Kanban card reaches the yellow area, this signals that the earlier determined lot size has been reached and that production can begin. Once a card reaches the red field, production must begin, otherwise the supply for the following process would be endangered.

The Kanban method does not necessarily have to be introduced across the entire company. It ensures cost reduction and increases in flexibility between appropriate processes, determined by the requirements. The principle is extremely simple. Empirically, once the most important parameters have been determined, effort expended on disposition is reduced considerably. The deployment of supportive tools is important for success. Especially the Kanban planning board is a decisive element for the successful implementation of a Kanban control.