Kanban is a lean manufacturing process that uses visual signals to control inventory and work flow. It was developed by Toyota based on pull production principles from supermarkets. A kanban system uses cards or bins to signal when more inventory is needed to be produced. The document then provides an example of how a kanban system would work with a board to limit work-in-progress at each stage and reveal bottlenecks in the production process. It describes the different types of kanbans for raw materials, work-in-progress, and finished goods.

1. SEMINAR ON QUALITY
MANAGEMENT
TOPIC:- KANBAN
Presented by,
Majida B
Jose Benjemin
Bijo Joseph
University of Calicut

2. Introduction
Derived from the combination of two Japanese words, kan ("visual") and ban
("card" or "board"), kanban roughly translates to sign board or signal board.
In English it has developed a highly specialized meaning - kanban is a process of
manufacturing or work space organization that relies upon visual signals to control
inventory. Kanban has become synonymous Just in Time production and "demand
scheduling. Kanban, as a means of manufacturing, was developed by Toyota during the
late 1940s and early 1950s. During that period, the Toyota Corporation studied American
supermarkets and their management techniques. Taiichi Ohno, the man credited with
developing JIT, saw the relationship between the supermarket and its customer as an
efficient means of organizing production, because a supermarket assures future stock
while only supplying what the consumer has immediately signaled that he or she needs.
The premise behind this organization is a visual signal, a kanban. In the case of a
supermarket it might be the level in a bin of oranges dipping below a certain marker. This
visual signal, in turn, tells the supermarket employee to stock more oranges. Ohno saw
the possibility to deploy this means of organization in Toyota's main machine shop, and
had done so by 1953. In the 1970s, with the economy worsening, kanban made its way
across the Pacific Ocean to the United States. Since 1977 it has become the principle
means of implementing Just in Time (JIT) production and is used in all manner of working
environments.

3. Kanban, also spelt kamban, is a Japanese term for “signboard” or “Billboard” that indicates
“available capacity (to work)”. Kanban is a concept related to lean and just-in-time (JIT)
production. Kanban is a scheduling system that tells you what to produce, when to
produce it, and how much to produce. Between the 1940s and 50s, Taiichi Ohno of Toyota
applied the Kanban logic in their Toyota Production System (TPS) to support non-
centralized “pull” production control. In the post-depression era of 1970s, Kanban was
popularized in the manufacturing industry as a tool for Lean Manufacturing. Of late, many
thought-leaders in various industries have found its applicability beyond the
manufacturing industry as well. In simplified terms, Kanban is a visual system for managing
work moving through a process - the “value stream”. It is a system for visualizing
work, reducing waste by limiting work in-progress, and maximizing customer value

4. Content
Kanban is a new technique for managing a software development process in a highly
efficient way. Kanban underpins Toyota's "just-in-time" (JIT) production system.
Although producing software is a creative activity and therefore different to mass-
producing cars, the underlying mechanism for managing the production line can still be
applied.
A software development process can be thought of as a pipeline with feature requests
entering one end and improved software emerging from the other end. Inside the
pipeline, there will be some kind of process which could range from an informal ad hoc
process to a highly formal phased process. In this article, we'll assume a simple phased
process of: (1) analyse the requirements, (2) develop the code, and (3) test it works.
The Effect of Bottlenecks
A bottleneck in a pipeline restricts flow. The throughput of the pipeline as a whole is
limited to the throughput of the bottleneck. Using our development pipeline as an
example: if the testers are only able to test 5 features per week whereas the
developers and analysts have the capacity to produce 10 features per week, the
throughput of the pipeline as a whole will only be 5 features per week because the
testers are acting as a bottleneck. If the analysts and developers aren't aware that the
testers are the bottleneck, then a backlog of work will begin to pile up in front of the
testers.

5. The effect is that lead times go up. And, like warehouse stock, work sitting in the pipeline
ties up investment, creates distance from the market, and drops in value as time goes by.
Inevitably, quality suffers. To keep up, the testers start to cut corners. The resulting bugs
released into production cause problems for the users and waste future pipeline capacity.
If, on the other hand, we knew where the bottleneck was, we could redeploy resources to
help relieve it. For example, the analysts could help with testing and the developers could
work on test automation. But how do we know where the bottleneck is in any given
process? And what happens when it moves?
Kanban reveals bottlenecks dynamically
Kanban is incredibly simple, but at the same time incredibly powerful. In its simplest
incarnation, a kanban system consists of a big board on the wall with cards or sticky notes
placed in columns with numbers at the top. Limiting work-in-progress reveals the
bottlenecks so you can address them. The cards represent work items as they flow
through the development process represented by the columns. The numbers at the top of
each column are limits on the number of cards allowed in each column.
The limits are the critical difference between a kanban board and any other visual
storyboard. Limiting the amount of work-in-progress (WIP), at each step in the
process, prevents overproduction and reveals bottlenecks dynamically so that you can
address them before they get out of hand.

6. Worked Example
The board below shows a situation where the developers and analysts are being prevented
from taking on any more work until the testers free up a slot and pull in the next work item.
At this point the developers and analysts should be looking at ways they can help relieve
the burden on the testers.
Notice that we've split some of the columns in two, to indicate items being worked on and
those finished and ready to be pulled by the downstream process. There are several
different ways you can layout out the board. This is a fairly simple way. The limits at the top
of the split columns cover both the "doing" and "done" columns. Once the testers have
finished testing a feature, they move the card and free up a slot in the "Test" column.

7. Now the empty slot in the "Test" column can be filled by one of the cards in
the development "done" column. That frees up a slot under "Development"
and the next card can be pulled from the "Analysis" column and so on.

8. A more realistic example would probably involve at least two pallets. The widget
assembler would start working from the second pallet while new stem-bolts were being
made to refill the first pallet. If this was a high volume widget manufacturing
facility, each widget assembly station might empty a pallet of stem-bolts in just a few
minutes, and there could be 15 or 20 widget assembly stations. Thus there would be a
continual flow of cards going back to the stem-bolt manufacturing area that would cause
a continual flow of pallets of stem-bolts to be sent to the widget assembly stations.
Kanban is Pull (Demand)
This is called a "pull" type of production system. The number of stem-bolts that are
made depends on the customer demand--in other words the number of cards received
by the stem-bolt manufacturing area. Systems other than cards may be used. For
example, the empty pallets may be returned to the stem-bolt manufacturing area. Each
empty pallet received indicates a need to manufacture 100 more stem-bolts. For other
types of components, bins, boxes or cages might be used instead of pallets. Or
components might be stored on shelves in the widget assembly area. When a shelf
became empty that signals that more components need to be manufactured and the
shelf refilled. In Kanban the method of handling the components is flexible, and depends
on the needs of the manufacturing process.

9. Functions of kanban
• Controls the amounts of raw material amounts and of material in Work In Process
• Smooth out flow, if sized properly
• Tells when and where there is a problem in the process
• Assures there is always just enough material on hand to make what is needed
Types of Kanban
• Raw Material Kanban – tells suppliers when to send how much of a particular item to a
particular place.
• In-Process Kanban – determines the amount of WIP (Work In Process) that can be kept
between any two operations in a process
• Finished Goods Kanban – determines the amount of a product to be kept on hand at
any given time. Removal of material from the Finished Goods Kanban acts as a signal for
more of that product to be manufactured.
Types of Kanban Signals:
• A calculated amount of material kept in a designated space, such as a bin or between
lines on a workbench or on the floor
• A card that is used to tell the amount of material to be made or ordered
• The markings on a bin that determine when more material needs to be ordered or
made
• Any other clear visual signal that indicates it is time to get more material

10. How Kanbans Work:
Material Resupply Kanban:
1. All of the parts used to manufacture a particular product are identified as well as the
number used in each product.
2. Lead time is calculated, that is the amount of time it takes for the parts to be
ordered and delivered.
3. The demand for the product over a specific length of time is then determined.
4. The number of parts used in the product is multiplied by the number of the products
demanded over the length of time that it takes to order and receive the parts.
5. The goal is to order parts at the point when the number of parts on hand reach the
amount that will be used up during the time it takes to order and get the needed parts
delivered. Usually, because of variability in lead time, the amount of reordered parts
occurs is usually a bit more than the amount of parts needed to cover order lead time.
Common signals used as kanbans include two bin resupply systems and card systems
Kanban has 8 things you need to know. They are broken down into three basic
principles (how you need to think) and five for properties (what you need to do).

11. Three Basic Principles
Start with what you do now
The Kanban method does not prescribe a certain setup or procedure. You can overlay
Kanban properties on top of your existing workflow or process to bring your issues to
light so that you can introduce positive change over time. This makes it very easy to
begin a Kanban implementation as you do not have to make sweeping changes.
Agree to pursue incremental, evolutionary change
The Kanban method is an approach to change management that is designed to meet
minimal resistance. Therefore it encourages continuous small incremental and
evolutionary changes to your current system. Sweeping changes are discouraged
because they generally encounter increased resistance due to fear or uncertainty. I call
it “baby steps to awesomeness!”
Respect the current process, roles, responsibilities & titles
Kanban recognizes that there may be value in the existing
process, roles, responsibilities, & titles. You have existing pieces in they way you do
what you do that are working properly and worth preserving. Kanban doesn’t prohibit
change, but it doesn’t prescribe it either. If you do make changes, Kanban encourages
incremental change. Incremental change doesn’t create the level of fear that impedes
progress, which allows you to be broader support for your Kanban implementation. It
also makes it easier to implement Kanban. Small course corrections are also just
inherently easier than altering the comple

12. Five Core Properties
In his book, Kanban – Successful Evolutionary Change for your Technology Business, David
Anderson identified five core properties that he consistently observed in successful
implementations of the Kanban method.
Visualize the workflow
You have to understand what it takes to get an item from request to completion. The goal
of Kanban is to make positive change to optimize the flow of work through the system.
Only after understanding how the workflow currently functions can you aspire to improve
it by making the correct adjustments. Making changes before you understand your
workflow is putting the proverbial cart before the horse and can cause you to make
choices that are, at best, unhelpful and, at worst, harmful.
The most common way to visualize your workflow is to use card walls with cards and
columns. Each column on the wall represents steps in your workflow.
Limit WIP
Limiting work-in-progress implies that a pull system is implemented on parts or all of the
workflow. The critical elements are that work-in-progress at each state in the workflow is
limited and that new work is “pulled” into the next step when there is available capacity
within the local WIP limit. These constraints will quickly illuminate problem areas in your
flow so you can identify and resolve them. Limiting WIP is the cornerstone of Kanban.

13. Manage flow
The whole point of implementing a Kanban system is to create positive change. Before you
can create that change you have to know what to change. You figure that out by looking at
how things are currently flowing through the system, analyzing problem areas and
defining changes (and, obviously, ultimately implementing them). Then, you repeat the
cycle to see what effect your changes had on the system because you need to know if the
change you made had a positive or negative impact on the things you were attempting to
change. You are never finished. To use a cliché, it’s a journey. Something I read recently
said that when you fix your first issue, your second one gets a promotion. I think that’s an
awesome reminder that we should always strive to make progress.
Make Process Policies Explicit
As I noted in “Visualize your workflow” above, you can’t improve something you don’t
understand. The process needs to be defined, published and socialized — explicitly and
succinctly. Without an explicit understanding of how things work and how work is actually
done, any discussion of problems tends to be emotional, anecdotal and subjective (AKA a
knee-jerk reaction). When everyone really understands what you are doing now and what
your goals are, then you can begin to make decisions regarding change that will move you
in a positive direction. The choices will be more rational, empirical, objective discussion of
issues. This is more likely to facilitate consensus around improvement suggestions.

14. Improve Collaboratively (using models & the scientific method)
As discussed, the Kanban method encourages small continuous, incremental and
evolutionary changes that stick. When teams have a shared understanding of
theories about work, workflow, process, and risk, they are more likely to be able
to build a shared comprehension of a problem and suggest improvement actions
which can be agreed by consensus.
Benefits of Kanban:
Shorter cycle times can deliver features faster.
Responsiveness to Change:
When priorities change very frequently, Kanban is ideal.
Balancing demand against throughput guarantees that most the customer-centric
features are always being worked.
Requires fewer organization / room set-up changes to get started
Reducing waste and removing activities that don’t add value to the
team/department/organization
Rapid feedback loops improve the chances of more motivated, empowered and
higher-performing team members

15. Conclusion
As we have mentioned, establishing a Kanban system in your workplace is very useful in terms
of waste reduction and effective utilization of resources. Kan ban is used in material handling
and it is flexible and can be changed according to the situations. Kanban helps to smooth the
flow of work to maximize “throughput” and achieve high product quality. Unlike many
methodologies which bring about disruptive changes in an organization's processes, Kanban is
an evolutionary system that prefers to gradually improve an organization's current processes.
This makes implementing Kanban far easier than other approaches, making it an increasingly
popular tool for managing any type of work, including agile software development.
REFERENCE
Chandra,D,etel,Quality Circles,Tata McGraw Hill,New Delhi 1996.
Wakhlu,Bharat,Total Quality,1 ed,Wheeler Publishing, New Delhi,1994
http://en.wikipedia.org/wiki/Total quality management.