Kanban (1)

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Kanban (1)

  1. 1. KANBAN
  2. 2. Kanban Definition What is Kanban? • Card system that controls production & inventory • Visual “pull” system vs. a “black box” push system (ie - MRP)
  3. 3. WHAT IS KANBAN? • DEVELOPED AT TOYOTA 1950S TO MANAGE LINE MATERIAL FLOWS. • KANBAN ( KAN=CARD, BAN= SIGNAL ) • SIMPLE MOVEMENT SYSTEM – “CARDS” TO SIGNAL & COMMUNICATE REORDER INFORMATION – BOXES/CONTAINERS TO TAKE “LOTS” OF PARTS FROM ONE WORK STATION TO ANOTHER (CLIENT-SERVER). • SERVER ONLY DELIVERS COMPONENTS TO CLIENT WORK STATION AS & WHEN NEEDED (CALLED/PULLED). • MINIMISE STORAGE IN THE PRODUCTION AREA. • WORKSTATIONS ONLY PRODUCE/DELIVER COMPONENTS WHEN CALLED (THEY RECEIVE CARD + EMPTY CONTAINER). • THE WORK-STATION PRODUCES ENOUGH TO FILL THE CONTAINER • KANBAN = AN AUTHORIZATION TO PRODUCE MORE INVENTORY • WE THUS LIMIT THE AMOUNT OF INVENTORY IN PROCESS.
  4. 4. WHAT IS KANBAN • TECHNIQUE FOR WORK AND INVENTORY RELEASE • MAJOR COMPONENT OF JIT AND LEAN MFG • DEVELOPED BY TOYOTA TO MANAGE MATERIAL FLOW IN ASSEMBLY LINE • KANBAN STANDS FOR KAN – CARD BAN - SIGNAL • ESSENCE OF KANBAN IS SUPPLIER , WAREHOUSE , MANUFACTURER SHOULD DELIVER COMPONENTS ONLY WHEN THEY ARE NEEDED SO THAT THERE IS NO EXCESS INVENTORY • WITHIN SYSTEMS WORK STATIONS LOCATED ALONG PRODUCTION LINES AND PRODUCE ONLY THE DESIRED COMPONENTS WHEN THEY RECEIVE A CARD AND AN EMPTY CONTAINER WHICH INDICATES MORE PARTS ARE NEEDED IN PRODUCTION
  5. 5. WHAT IS KANBAN • TWO BIN SYSTEM WHERE REORDER CARD PLACED AT BOTTOM OF FIRST BIN • WHEN BIN IS EMPTY A THIRD PARTY SUPPLIER OR PREVIOUS WKSTN USE THE REORDER CARD TO REPLENISH BIN • SECOND BIN IS EMPLOYED SUCH THAT WHEN FIRST BIN IS REPLENISHED SECOND BIN IS READY FOR REPLENISHMENT • NO REPLENISHMENT WOULD TAKE PLACE WITHOUT REORDER CARD ENSURING THAT OVERSTOCKING DOES NOT TAKE PLACE
  6. 6. WHAT IS KANBAN • INCASE OF INTERRUPTION MEASURES ARE TAKEN SO THAT EACH WKSTN WILL ONLY PRODUCE ENOUGH COMPONENTS TO FILL CONTAINER • KANBAN LIMITS AMOUNT OF INVENTORY IN THE PROCESS BY ACTING AS A AUTHORIZATION TO PRODUCE MORE INVENTORY
  7. 7. WHAT IS KANBAN • AS KANBAN IS A CHAIN PROCESS IN WHICH ORDERS FLOW FROM ONE PROCESS TO ANOTHER, PRODUCTION OF COMPONENTSARE PULLED THRU THE LINE • IN JIT SYSTEMS COMPONENTS ARE NEEDED FOR FINAL ASSEMBLY ;THEY ARE PULLED IN SMALL BATCHES FROM THE SUPPLYING WORKSTATION • KANBAN IS A CRITICAL COMPONENT OF JIT • EMPLOYED WITHIN PRODUCTION PULL SYSTEM TO MAINTAIN PROCESS SUPPLY
  8. 8. WHAT IS KANBAN • IN CASE OF LINE INTERUPTION MEASURES TAKEN SO THAT EACH WORK STATION ONLY PRODUCES ENOUGH COMPONENTS TO FILL CONTAINER AND THEN STOP • KANBAN LIMITS ACCUMULATION OF INVENTORY IN WIP BY ACTING AS AN AUTHORIZATION TO PRODUCE MORE • KANBAN IS A CHAIN PROCESS IN WHICH ORDERS FLOW FROM ONE PROCESS TO ANOTHER • PRODUCTION OR DELIVERY OF COMPONENTS PULLED THRU PRODUCTION LINE • IN JIT SYSTEMS WHEN COMPONENTS/PARTS NEEDED FOR FINAL ASSEMBLY , THEY ARE PULLED IN SMALL BATCHES FROM SUPPLYING WORK CENTRES
  9. 9. WHAT IS KANBAN • KANBAN WORKS AUTOMATICALLY IN PULL SYSTEM (CUSTOMER DRIVEN) • KANBAN SHOWS -WHAT PARTS TO MFG -WHEN TO START MFG -HOW MUCH TO MFG • EMPLOYED WITHIN A PRODUCTION PULL SYSTEM TO MAINTAIN PROCESS SUPPLY • SYSTEM EMPLOYS SIGNALS TO LINK PROCESSES THAT ARE USED TO REPLENISH STOCKS BASED ON CUSTOMER USAGE • SIZE OF KANBAN CONTAINER NO MORE THAN 10 OF DAILY DEMAND AND STANDARDIZED IN SIZE • KANBAN SUITED FOR PRODUCTS WITH HIGH VOLUME
  10. 10. WHAT IS KANBAN • KANBAN AUTHORIZES OUTPUT FROM DOWNSTREAM OPERATIONS BASED ON PHYSICAL CONSUMPTION • CAN BE A CARD , FLAG, SIGNAL • USED WITH FIXED SIZED CONTAINERS • KANBAN QUANTITIES ARE FUNCTION OF LEAD TIMES AND CONSUMPTION RATES OF ITEM BEING REPLENISHED ( MIN QTY = (LEAD TIME DEMAND + SAFETY STOCK)/CONTAINER QTY)
  11. 11. What is the Kanban System? A Card System is used to monitor work-in-process • A withdrawal Kanban • A production Kanban • A vendor Kanban
  12. 12. Kanban System 6-12
  13. 13. Kanban Cards 6-13
  14. 14. • Kanbans are All Around Us • Kanbans are Inventory • Inventory Is waste (costly!) • Goal Is To Minimize Inventory In Kanbans And Eliminate If Possible Basic Kanban (Pull signal)Basic Kanban (Pull signal) Ultimate Goal of Kanban is to notUltimate Goal of Kanban is to not have a KANBAN !have a KANBAN ! One-Piece Flow is the Answer !One-Piece Flow is the Answer !
  15. 15. The Kanban Process Withdrawal Store LCD Screen Withdrawal Lot with P-Kanban Production Ordering Post (6) Signal LCD Assembly Remove (4) P-Kanban Attach (5) Attach W-Kanban (1) Remove W-Kanban Attach Withdrawal Post (2), (3) (7) Final Assembly (1)
  16. 16. Kanban Production Control • At the core of JIT manufacturing at Toyota is Kanban, an amazingly simple system of planning and controlling production • Kanban, in Japanese, means card or marquee • Kanban is the means of signaling to the upstream workstation that the downstream workstation is ready for the upstream workstation to produce another batch of
  17. 17. Kanban Systems • Logistical ropes connect the various work stations and drive their JIT systems. • Set up MPS which is determined by market demand. • The projected daily demand for each product is the amount that is scheduled to be produced for that day.
  18. 18. Kanban Systems, cont. • The smoothed production schedule is then set for a fixed period of time-normally one month. • Then final assembly is scheduled in order to meet the daily production requirements.
  19. 19. Kanban Systems Can use different methods to trigger replenishment activity – kanban cards are the most common – kanban containers are frequently used – bar coding of cards / containers helps when automating kanban systems
  20. 20. Kanban Systems Not suited for all inventory items – look for – items with frequent usage – items with short lead times – items with “willing” suppliers
  21. 21. 21 KANBAN Prodn Control Kanban: • Card or other device that communicates demand for work or materials from the preceding station • Kanban is the Japanese word meaning “signal” or “visible record” card • Paperless production control system • Authority to pull, or produce from a downstream process
  22. 22. 22 Kanban is not for everybody • The conditions necessary for Kanban to work well are: – “Smooth” production involving a stable product mix – Short setups – Proper machine layout – Standardization of jobs – Improvement activities – Autonomation (autonomous defect control)
  23. 23. 24 Kanban Production Control System • Kanban card indicates standard quantity of production • Derived from two-bin inventory system • Kanban maintains discipline of pull production • Production kanban authorizes production
  24. 24. 25 A Sample Kanban
  25. 25. 26 The Origin of Kanban a) Two-bin inventory system b) Kanban inventory system ReorderReorder cardcard Bin 1Bin 1 Bin 2Bin 2 Q - R KanbanKanban RR QQ = order quantity= order quantity RR = reorder point - demand during lead time= reorder point - demand during lead time
  26. 26. • No Cards – Visual (Tape On Floor) – Two-Bin or Bin Systems – Supplier Containers – Painted floors, i.e. squares, circles • Card Systems – Electronic Kanbans - Fax or Emails – Warehouse Or Parts Racks – Kanban Boards – Magnetic or Cards – Containers – Flow Thru Racks – Supplier Boxes Kanban Options
  27. 27. Categories of Kanban Instruction Withdrawal Kanban Production Kanban (non lot production) Triangle Kanban (for lot production) Interprocess Kanban Supplier Kanban
  28. 28. © 2007 Pearson Education The Single-Card Kanban System • Kanban means “card” or “visible record” in Japanese & refers to cards used to control the flow of production through a factory. • General Operating Rules: 1. Each container must have a card. 2. The assembly line always withdraws materials from fabrication (pull system). 3. Containers of parts must never be removed from a storage area without a kanban being posted on the receiving post. 4. The containers should always contain the same number of good parts. The use of nonstandard containers or irregularly filled containers disrupts the production flow of the assembly line. 5. Only nondefective parts should be passed along. 6. Total production should not exceed the total amount authorized on the kanbans in the system.
  29. 29. Two card Kanban System • Toyota, which uses a dual-card kanban system, has its own inbound and outbound material storage areas. *inbound stock area- holds material that is ready for processing at the work station. *outbound stock area- material that has been processed and is stored until needed at the next downstream station.
  30. 30. 31 Kanban Example Workcenter B uses parts produced by Workcenter A How can we control the flow of materials so that B always has parts and A doesn’t overproduce?
  31. 31. 32 When a container is opened by Workcenter B, its kanban card is removed and sent back to Workcenter A. This is a signal to Workcenter A to produce another box of parts. Kanban card: Signal to produce
  32. 32. 33 Empty Box: Signal to pull Empty box sent back. Signal to pull another full box into Workcenter B. Question: How many kanban cards here? Why?
  33. 33. 34 Types of Kanbans
  34. 34. 35 Types of Kanbans
  35. 35. 36 Types of Kanbans
  36. 36. 37 Types of Kanbans• Kanban Square – Marked area designed to hold items • Signal Kanban – Triangular kanban used to signal production at the previous workstation • Material Kanban – Used to order material in advance of a process • Supplier Kanbans – Rotate between the factory and suppliers
  37. 37. freeleansite.com Production or (In-Process)-Kanban – Provides production instructions for the work center – Tells the workers exactly the quantity and the type of part to produce – Used for work centers that produce only one part number or have minimal setups in spite of multiple part number production • Rectangular – one piece flow production • Triangular – for small lot production Withdrawal-Kanban – Inter-Process Kanban • Delivers order for parts from a preceding process • Specifies quantity and type of parts to deliver from Location A to Location B – Later replenishment system – kanban are filled from suppliers finished goods shelf – Sequenced withdrawal – supplier sequences parts in reverse order for truck loading – Supplier Kanban • Same as an inter-process Kanban, except it signals conveyance of part from an outside supplier Kanban Types
  38. 38. freeleansite.com Job order-Kanban – Issued for each job order Through-Kanban – When two processes are very close, it doesn’t make sense to issue two Kanbans. Used where one process directly feeds (conveyor) the next process. Common-Kanban – Where a withdrawal kanban is used as a production ordering kanban if the distance between two processes is very short and share the same supervisor. – Emergency-Kanban – Temporary, when there is a defect or problem, can be withdrawal or production Other Kanban Types
  39. 39. freeleansite.com • Never Pass on A Bad Part • The Parts Are Always Withdrawn From The Prior Process • Produce Only What Is Necessary To Replenish The Quantity Withdrawn • Level Load Production, Rapid Changeover, Small Lot Production, Zero Defects • Kanban Is Used To Fine Tune (Not Provide For Major Changes) • The Process Must Be Capable Of Producing Good Parts (Rational And Stable) • Need Efficient Methods Of Transportation, Shortest Routes Possible • Disciplined Organization • Nothing Is Made or Transported Without A Kanban. • Kanban Cards Always Accompany the Parts Themselves. • The Number of Kanbans Should Decrease over time. Rules of the Kanban
  40. 40. 41 Determining Number of Kanbans where N = number of kanbans or containers d = average demand over some time period L = lead time to replenish an order S = safety stock C = container size No. of Kanbans = average demand during lead time + safety stock container size NN == dLdL ++ SS CC
  41. 41. 42 Determining the Number of Kanbans d = 150 bottles per hour L = 30 minutes = 0.5 hours S = 0.10(150 x 0.5) = 7.5 C = 25 bottles  Round up to 4 (to allow some slack) or down to 3 (to force improvement) ContainersorKanbans3.3= + = +⋅ = + = 25 5.775 25 5.7)5.0150( C SdL N Solution
  42. 42. 44 Product Specific One-card Kanban System Product Z after process A Process A Process B Process C Process A+B+CProcess A+B Finished product X Product X after process A Finished product Z product X kanban card Process A Location after process A
  43. 43. 45 Signals From Parts And Cards Product Z removed from FGI Product Z Kanban card put up at C Z 1 Authorizes another product Z to be started
  44. 44. 46 More details……process B & C Z Completed Z after process C goes with card to FGI Z 1 Z 1 Z kanban put up at B to schedule production of another Z product C removes partially completed Z from input buffer
  45. 45. 47 Moving further upstream…. Completed Z after process B goes with card to output buffer Z 1 Z kanban put up at A to schedule production of another Z product Z 1 B removes partially completed Z from input buffer
  46. 46. 48 Last step……... Z and kanban card placed in step A output buffer process step A creates product Z
  47. 47. 49 Idle state • No kanban cards at any process stage – No production occurs – Removing an X or Z from FGI would restart process
  48. 48. 50 Kanban work authorization• If this is state, who’s authorized to work on a Z? 1. A 2. B 3. C 4. A,B 5. B,C 6. A,C 7. A,B,C 8. none
  49. 49. 51 Scheduling Kanban systems • Each stage has its ‘own schedule’ of Kanbans • This schedule is determined at the Kanban system design stage • Production is indirectly scheduled by Kanban
  50. 50. 52 Kanban Control System • Kanban card indicates standard quantity of production • Derived from two-bin inventory system • Kanban maintains discipline of pull production Q = order quantity R = reorder point = demand during lead time Bin 1 Bin 2 Q - R R Reorder Card Kanban a. Two-bin inventory system b. Kanban Inventory System
  51. 51. 53 Kanban Control System • Once implemented, a Kanban system acts a control system rather than a scheduling system • It implements a repetitive schedule embedded in the system • This schedule can be generated by a scheduling algorithm • Simulation can be used to determine the number of Kanbans, queue size, etc.
  52. 52. 54 Kanban Control Systems• Roles of Kanban – To indicate what is needed at which production stage – To allow various stages to efficiently communicate with each other – The information can be obtained from the Kanbans • Product name • Code • Volume • Preceding stage and subsequent stage (From .. To ..) • Process – Company’s production plan is given only to the final line
  53. 53. 55 General Kanban SystemOp1: when demand from stage i+1 occurs, withdraw a Kanban and place it on the dispatching board Op2: production activity initiates when a Kanban is placed on the dispatching board Op3: simultaneously, demand is sent to stage i-1 if demand occurs at stage i Op4: completed parts with Kanbans are sent to stage i+1
  54. 54. 56 Operations Principles of Kanban Systems • Move a Kanban only when the lot it represents is consumed • No withdrawal of parts without a Kanban is allowed • Kanban should always be attached to the physical parts (box) • Do not send defective parts to the succeeding stages • Withdraw only the parts needed at each stage • Produce the exact quantity of parts withdrawn • The # of parts issued to the subsequent process must be the exact number specified by the Kanban • Avoid complex information and hierarchical control systems
  55. 55. 57 Dual Kanban system Using production and withdrawal Kanbans
  56. 56. 58 Dual Kanban system Process A Process B P W Container with withdrawal kanban Container with production kanban PWP X X X X X Flow of work Flow of kanban
  57. 57. Minimizing Waste: Kanban Control System Bin Part A Bin Part AMachine Center Assembly Line Material Flow Card (signal) Flow withdrawal kanban production kanban
  58. 58. A Two-Card Kanban JIT Operating System
  59. 59. Kanban Systems, Cont. • Conveyance kanban- a card that identifies needed material, the feeding workstation, and the receiving workstation. • Production kanban- Is the signal and authority for the work station operators to replenish the materials just forwarded to the from the outbound stock area.
  60. 60. Kanbans and Other Signals • There are two types of Kanban cards: – a conveyance card (C-Kanban) – a production card (P-Kanban) • Signals come in many forms other than cards, including: – an empty crate – an empty designated location on the floor
  61. 61. Kanban System The number of Kanban cards is directly proportional to the amount of work-in-process inventory. Managers and employees strive to reduce the number of cards in the system through reduced lead times (p or w), lower α values, or other improvements. WIP inventories are similar to the water level in a lake. High levels hide critical inefficiencies. By reducing inventories, inefficiencies are exposed and must be solved using a JIT system.
  62. 62. Number of Kanban Cards Required: K = d(p + w)(1+ α) [17.1] C where K = the number of Kanban cards in the operating system. d = the average daily production rate as determined from the master production schedule. w = the waiting time of Kanban cards in decimal fractions of a day (that is, the waiting time of a part). p = the processing time per part, in decimal fractions of a day. C = the capacity of a standard container in the proper units of measure (parts, items, etc.). α = a policy variable determined by the efficiency of the process and its workstations and the uncertainty of the workplace, and therefore, a form of safety stock usually ranging from 0 to 1. However, technically there is no upper limit on the value of α. Chapter 17 Lean Operating Systems
  63. 63. Solved Problem Bracket Manufacturing uses a Kanban system for a component part. The daily demand is 800 brackets. Each container has a combined waiting and processing time of 0.34 days. The container size is 50 brackets and safety factor (α) is 9 percent. a) How many Kanban card sets should be authorized? b) What is the maximum inventory of brackets in the system of brackets? c) What are the answers to (a) and (b) if waiting and processing time are reduced by 25%? d) If we assume one-half the containers are empty and one-half full at any given time, what is the average inventory in the system for the original problem? Chapter 17 Lean Operating Systems
  64. 64. Solved Problem – Solution Using Equation 17.1: a) K = d(p + w)(1+ α)=(800 units)(.34)(1 + .09)=5.93 ≅ 6 C 50 Thus, 6 containers and 6 Kanban card sets are necessary to fulfill daily demand. b) The maximum authorized inventory is K×C = 6×50 = 300 brackets. c) K = d(p + w)(1+ α)=(800 units)(.255)(1 + .09)=4.45 ≅ 5 C 50 Thus, 5 containers and 5 Kanban card sets are necessary to fulfill daily demand. The maximum authorized inventory is now K×C = 5×50 = 250 brackets. Chapter 17 Lean Operating Systems
  65. 65. Solved Problem - Solution d) The average inventory under this assumption is 300/2 = 150 brackets. Many variables in the JIT system determine whether this assumption is valid or not. For example, for a given combination of daily demand, processing and waiting times, and other process inefficiencies and uncertainties, it is possible for more or less containers to be empty (full). Chapter 17 Lean Operating Systems
  66. 66. Determining the number of kanban cards / containers needed for each item • An item has a 2 day lead time (when a kanban is emptied it will take 2 days to refill it) • Thus, you need to activate 5 kanban cards (demand during lead time divided by kanban size) • You will need 100 within the replenishment lead time (average daily demand times lead time) • Average daily usage of the item is 50 per day • An item has a 2 day lead time (when a kanban is emptied it will take 2 days to refill it)
  67. 67. ESSENTIAL ELEMENTS OF KANBAN • STOCK POINTS • WITHDRAWAL SIGNAL • IMMEDIATE FEEDBACK • FREQUENT REPLENISHMENT
  68. 68. FUNCTIONS OF KANBAN • PROVIDES PICK UP INFO • PROVIDES PRODUCTION INFO • PREVENTS OVER PRODUCTION • SERVES AS WORK ORDER ATTACHED TO GOODS • PREVENTS DEFECTS BY IDENTIFYING PROCESS MAKING THE DEFECTS • MAINTAINS INVENTORY CONTROL
  69. 69. How Kanban Operates When a worker at downstream Work Center #2 needs a container of parts, she does the following: – She takes the C-Kanban from the container she just emptied – She finds a full container of the needed part in storage – She places the C-Kanban in the full container and removes the P-Kanban from the full container and places it on a post at Work Center #1 – She takes the full container of parts with its C-Kanban back to Work Center #2
  70. 70. Kanban Cards Conveyance Kanban CardConveyance Kanban Card Part number to produce: M471-36 Part description: Valve HousingPart number to produce: M471-36 Part description: Valve Housing Lot size needed: 40Lot size needed: 40 Container type: RED CrateContainer type: RED Crate Card number: 2 of 5Card number: 2 of 5 Retrieval storage location: NW53DRetrieval storage location: NW53D From work center: 22From work center: 22 To work center: 35To work center: 35
  71. 71. Kanban Cards Production Kanban CardProduction Kanban Card Part number to produce: M471-36 Part description: Valve HousingPart number to produce: M471-36 Part description: Valve Housing Lot size needed: 40Lot size needed: 40 Container type: RED crateContainer type: RED crate Card number: 4 of 5Card number: 4 of 5 Completed storage location: NW53DCompleted storage location: NW53D From work center: 22From work center: 22 To work center: 35To work center: 35 Materials required:Materials required: Material no. 744BMaterial no. 744B Storage location: NW48CStorage location: NW48C Part no. B238-5Part no. B238-5 Storage location: NW47BStorage location: NW47B
  72. 72. Containers in a Kanban System • Kanban is based on the simple idea of replacement of containers of parts, one at a time. • Containers are reserved for specific parts, are purposely kept small, and always contain the same standard number of parts for each part number. • At Toyota the containers must not hold more than about 10% of a day’s requirements. • There is a minimum of two containers for each part number, one at the upstream “producing” work center and one at the downstream “using” work center.
  73. 73. How Kanban systems work • Applies the basic principles of synchronous management. • Principle 1: Do not focus on balancing capacities, focus on synchronizing the flow. • Principle 2: The level of utilization of a non-bottleneck resource is controlled by other constraints within the system. • Principle 3: Resources must be utilized, not simply activated.
  74. 74. How Kanbans work, cont. • Principle 4: A transfer batch may not, and many times should not, be equal to the process batch. • Principle 5: A process batch should be variable both along its route and over time.
  75. 75. Why consider kanban control?  Lower inventory investment  Better “customer” service  Reduced administrative costs
  76. 76. What makes kanban control different ? • Kanban is “pull” based – driven by actual usage not forecasts • Kanban replenishment is simple ?
  77. 77. PULL ENTITIES IN KANBAN • WORK CENTRE – WHEN WORK CENTRE KANBAN CHECKED OUT SYSTEM FINDS AN OPEN WORK ORDER OR RATE SCHEDULE . WHEN NO WORK ORDER EXISTS SYSTEM CREATES A WORK ORDER TO FULFIL KANBAN DEMAND. WHEN KANBAN IS CHECKED TO INDICATE REPLACEMENT AN INVENTORY TRANSFER FROM SUPPLYING LOCATION TO CONSUMING LOCATION OCCURS • INVENTORY-WHEN INVENTORY KANBAN CHECKED OUT SYSTEM CREAES INVENTORY TRANSFER TO MOVE MATERIAL FROM ITS SUPPLYING LOCATION TO CONSUMING LOCATION eg REQUIRED RAW MATERIAL MOVED FROM INVENTORY TO WORK CENTRELOCATION OR SHOP FLOOR • SUPPLIER-WHEN A SUPPLIER KANBAN CHECKED OUT SYSTEM CREATES A PO OR INITIATES A BLANKET PO RELEASE.PO RECEIPT FOR GOODS RECEIPT DONE WHEN KANBAN CHECKED TO INDICATE REPLENISHMENTINVENTORY TRANSFER FROM SUPPLYING LOCATION TO CONSUMING LOCATIO DONE
  78. 78. PULL ENTITIES IN KANBAN • BRANCH-SYSTEM CREATES A SALES ORDER AND PO FOR ITEM. SYSTEM RECEIVES PO CREATED • OUTSIDE ASSEMBLY – SYSTEM CREATES SALES ORDER FOR LIST OF COMPONENTS REQUIRED TO MAKE A PRODUCT.PO CREATED FOR INVENTORY TRANSFER FROM SUPPLYING LOCATION TO CONSUMING LOCATION
  79. 79. Managing Kanban Systems How is lead time (τi) determined? • By observation – start with “too many” kanbans in the system. Mark the time when a kanban leaves the output buffer to be replenished. Record when the kanban returns to the output buffer. Record a number of observations and find the mean and standard deviation. To build in a safety factor, the lead time should be calculated as the mean plus 2 or 3 standard deviations.
  80. 80. Managing Kanban Systems Key factors which must be in place before implementing a kanban system: • Demand is approximately constant over a planning period • Small setup times • Available, flexible capacity • Disciplined workforce
  81. 81. STRATEGIES IN KANBAN • REPLENISHMENT STRATEGY (VARIABLE SS , ROL , EOQ) • ENVIRONMENT TURBULENCE INDICATORS SUCH AS DYNAMIC CUSTOMER REQUIREMENT (CUSTOMER FUNCTION DEPLOYMENT) , SUPPLY CHAIN TURBULENCE (LOGISTICS) • REQUIREMENT FOR AGILITY AND FLEXIBILITY eg MAGIC EYE
  82. 82. TIPS FOR EFFECTIVE KANBAN • REPLENISHMENT PROCESS TO BE BALANCED TO REDUCE RISK OF OVER STOCKING OR POTENTIAL STOCKOUTS • NO PART TO BE PRODUCED WITHOUT KANBAN SIGNAL AND CARDS TO ALWAYS ACCOMPANY CONTAINER FROM THE SUPPLIER SIDE UNTIL IT IS OUT OF THE KANBAN STAGING AREA • EACH CONTAINER MUST HAVE A SEPARATE KANBAN CARD WITH PART NUMBER DESCRIPTION QTY AND LOCATION OF CONSUMER AND PRODUCER • NO PART TO BE PRODUCED WITHOUT A KANBAN
  83. 83. TIPS FOR EFFECTIVE KANBAN • PARTS TO BE PULLED THRU SUCCEEDING WORKSTATIONS OR PROCESS • NO DEFECTIVE PART TO BE SENT TO SUCCEEDING WORK STATION OR PROCESS • AMOUNT OF OUTPUT PRODUCED SHOULD CORRESPOND TO QUANTITY WITHDRAWN BY SUCCEEDING WORK STATION / PROCESS
  84. 84. MANAGEMENT PRACTICES IN KANBAN • PRODUCTION SMOOTHING • REDUCTION OF SET UP TIME • STANDARDIZATION OF JOBS • IMPROVEMENT OF ACTIVITIES • AUTOMATION
  85. 85. How Do We Implement It? • 3 Steps – Define the common goal so that it is understandable and meaningful to everyone – Develop what will cause individual actions to relate to the common goal – Manage the various actions to achieve the greatest benefit
  86. 86. BENEFITS OF KANBAN • PROVIDES QUICK AND PRECISE INFORMATION • PROVIDES QUICK RESPONSE TO CHANGES • AVOIDS OVER PRODUCTION • MINIMIZES WASTE • MAINTAINS FULL CONTROL • DELEGATES RESPONSIBILITIES TO WORKERS
  87. 87. freeleansite.com Benefits of Kanban • Primary – Eliminate over-production, the #1 waste – Produce only what is ordered, when ordered, & quantity ordered • Secondary – Increase flexibility to meet customer demand – Reduction in scheduling by Production Control & Manufacturing – Competitive advantage by sequencing shipments to customers (what they want, when they want it, in the order they want it!)

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