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Definition of kanban: - An inventory control system for tracking the flow of in-process materials through the various operations of a just-in-time production process. Kanban means "card" or "ticket" in Japanese. Generally we can say that KANBAN is a system of continuous supply of components, parts and supplies, such that workers have what they need, where they need it, when they need it.
It is a concept related to lean and just-in-time (JIT) production. It is a signaling system to trigger action. As its name suggests, kanban historically uses cards to signal the need for an item. It became an effective tool to support the running of the production system as a whole. In addition, it proved to be an excellent way for promoting improvements because reducing the number of kanban in circulation highlighted problem areas.
It maintains the visible records , it is a system of notification from one process to the other in a manufacturing system. Kanban cards, which may be multicolored, based on priority, are stored in a bin or container that holds the items. They describe the parts, supplier and quantity. When the bin is emptied, the Kanban is used to order more. A two-card Kanban system uses "move" cards to relocate items from one workplace to another and "production" cards to replace the material when it is used or sold.
ORIGIN OF TERM KANBAN:-
The word "kanban" means "shop sign" in Japanese. How did it come to be applied to the cards used to run Toyota's famous part delivery system as in the bins of forgings ? A kanban is more than just a sign; it represents the soul and the honor of a business -- like a family crest in the European tradition. The kanban is said to "cry" if the business is associated with any sort of scandal. Another meaning for kanban was a sort of shirt worn by servants of the samurai to indicate that they acted on the authority of a certain clan or lord. Perhaps this is where the origin of the expression "carrying a kanban on one's back" came from. Reputable merchants of old Japan used a similar system of issuing to their employees a "happi" jacket printed with the store's kanban so it would be clear that they acted on behalf of the business. So if a person claimed to represent a business but did not wear the issued clothing, then another might respond: "Who are you and who sent you? Wear your kanban if you expect to talk business!"
Kanban is spelled "kamban" because it is thought to replicate the Japanese pronunciation more faithfully. "Kanban" and "Kamban" refer to the same word in Japanese.
The "Kanban Seido" or "kanban system" was originally the name that most Japanese companies used to refer to Toyota's special approach to manufacturing -- due to Japanese Business' familiarity with kanban cards. The translation of "kanban seido" into English in those days was usually "just in time delivery."
NEED OF KANBAN:-
The basic need of kanban is:-
for inventory management
for inventory control
to pull the system
for lean manufacturing
INVENTORY MANAGEMENT SERVICES:-
Quality Tool has implemented inventory management systems to synchronize production with customer demand, resulting in shorter lead time and cost reductions. In addition to utilizing supplier forecasts and lean manufacturing (Kaizen, 5s) to reduce cycle time, Quality Tool can implement Kanban systems for pull based replenishment and parts creation. Consequently, we have become highly responsive to customer demand by providing shorter lead-times. Our combination of lean manufacturing and kanban inventory management systems makes Quality Tool the industry leader in value and service.
Kanban may be setup to insure delivery to customer's schedule and reduce inventory. Using Kanban inventory controls allows us to help you meet your challenges with working capital, inventory turns, and your need to have supply products in a short period of time. Our delivery performance has been superior to domestic suppliers.
Kanban is a method of controlling the flow of production through the factory based on a customer's demand. Pull Systems control the flow of resources in a production process by replacing only what has been consumed. They are customer order-driven production schedules based on actual demand and consumption rather than forecasting. Implementing Pull Systems can help you eliminate waste in handling, storing, and getting your product to the customer. Pull Systems are an excellent tool to use in the areas where cellular or flow manufacturing cannot be achieved.
Kanban Systems Enable the Lean Manufacturing Environment to Identify Wastes and Improve Processes While Minimizing Inventories and Saving Money. Kanban and lean manufacturing Visible Board System organizes, plans, schedules and tracks lean manufacturing productivity.
BENEFITS OF KANBAN:-
1)Reduce overall inventory
2)Reduce work in process
3)Smooth the production flow
4)Reduce order turnaround time
5)Increase customer satisfaction
6)Improve cash flow
7)Significantly reduce non-value-added efforts for both manufacturing and inventory materials movement.
TYPES OF KANBAN SYSTEM:-
The eight types of Kanban system are available and what you need to do to choose, design, implement, and operate Kanban systems, size buffer stocks (the number of Kanbans), choose containers and signaling mechanisms. It shows the need to integrate the system with your planning systems. It includes the impact on people, accounting, materials handling systems and some important do's and don'ts. This type of system belongs to a category of materials management systems called "pull" systems. There are 6 main types, (plus two significant variants), (excluding 2 bin & 3 bin systems):-
ONE CARD SYSTEM
A signal is sent back from the consuming process to supplying process (or supplier). This is a signal:
To send some more (a transfer batch), via a buffer stock.
To produce some more (a process batch), at the supplying work centre.
Empty containers acting as a signal are a potential hazard as any empty container is a signal to fill it. Also occasionally containers have been known to go missing! Usually, for these reasons, the signal is separated from the container.
2) Input / Output Control Kanban (Two variants):-
Sometimes called the constant work in process system, this type imposes input / output control, where the signal travels directly from the end of a line or section to the preceding section or raw material stores. In this case the supply chain is treated as one unit rather than a series of linked operations. So, as one transfer batch is completed (output) another is launched on the first operation (input), thus ensuring that work in process cannot build up. However there are some special considerations required in the operation of the system, to avoid hidden capacity problems, which are not so clearly visible when this method is used. We have used adaptations of this system to manage workflow and capacity rather than materials in a number of environments including job shop & clerical / technical process environments.
3) Kanban Accumulator
In this method Kanban signals are allowed to accumulate at the supplying work centre until the production batch size is reached. Buffers can be depleted or exhausted depending on the accumulation rules. Also because buffers can be exhausted, slightly higher mixes can be accommodated.
4) Dual Card System (2 Card System)
There are two types of two card system. The first method separates the replenishment (send some) signal, which is produced from the Kanban system, from the "produce" signal, which is produced by a scheduling system such as MRP. The purpose of each of the cards is as follows:
The scheduling system says which job is next.
The Kanban says make it now. (I need some.)
The second variant of this method generates the second card (after authorization) as a result of one or more replenishment requests in a similar way to Kanban accumulators.
5) Variable Quantity (fixed frequency) System
It is more convenient to replenish items used, by fixed frequency deliveries (or collections), rather than respond to fixed quantity replenishment requests. This method forms the basis of supplier "top up at point of use" systems, where a supplier visiting your point of use will top up stocks to a predefined maximum level. We have also used this method as the mechanism to drive "replacement systems" for maintaining stocks of critical spares items or maintaining "van stock" for on-the-road service engineers.
6) POLCA System ("Quick Response Manufacturing" Rajan Suri )
This is mentioned for completeness only and is said to be prescribed for high-mix, variable-route, and situations. However at this point, it is worth considering other simplification techniques ("Organizational Redesign"), or as a last resort, the use of scheduling tools ("Advanced Planning & Scheduling").
ADVANTAGES AND DISADVANTAGES OF KANBAN SYETEM:-
A simple and understandable process
Easy to install and to train operators to use
Reduces lead times
Provides quick and precise information
Low costs associated with the transfer of information
Provides quick response to changes
Limit of over-capacity in processes
Minimizing waste and Controls WIP Effectively
Control can be maintained
Delegates responsibility to line workers
Inflexible (transfer batch fixed, except with "Variable Quantity Systems" above)
Can cause stoppages (often viewed as an opportunity to solve a problem)
Highly stable! (But you may need to change due to changes in demand for example, or it may be an unstable environment). Pull systems do not plan. They react!
RELIABILITY OF KANBAN IN INDUSTRIES
RECENTLY EXAMPLE OF KOZMA INDUSTRIES
KANBANS are used to achieve a just-in-time supply resulting in reduced inventory, production costs and lead times. A "Kanban" ticket is assigned to every stage in production from ordering of raw materials from suppliers (coil steel, wires, rivets, etc.) to delivery of the customers finished product. The just-in-time organizational system ensures that Kozma's supply is geared directly to customer demand. It is a form of vertical integration between Kozma and their customers beneficial to both parties.
INFORMATION IN ARTICLES
I have seen an increase in the number of articles in the Development and Agile Project Management communities that describe the merits of Kanban, showing the value that Kanban has helped provide in conjunction with Agile methods. Most of these articles focus heavily on the visualization aspect (Visualizing Agile Projects using Kanban Boards for example) though a few dig into other benefits of Kanban or simply claim Kanban is a silver hammer in search of a nail. In the IT community it seems that most of the material has been directed at software project management and IT Developers, but Kanban is applicable to many other areas of IT.