If you ever wondered “What is Kanban” it might surprise you to find out where it originated. The idea for Kanban manufacturing actually came from the grocery store. While passing through the supermarket, it’s likely you’ll spot workers restocking shelves. As customers pull items from the shelf, those items are replenished to keep up with demand.
It was this method of handling inventory that got Toyota industrial engineer Taiichi Ohno thinking. He wondered if the same approach could help improve the efficiency of the Toyota production system. He started looking for a way to reduce cycle time.
What came from this idea was an innovative inventory scheduling system. It’s known as Kanban manufacturing — a production line technique that iCONN Systems uses.
What Is Kanban?
In its simplest form, you can think of Kanban manufacturing as a board on a wall that includes cards. Each column of cards, or work items, represents a different part of the workflow. A Kanban board visually depicts work at various stages of a process. Kanban maintains inventory levels and sends a signal to produce and deliver a new shipment as material is consumed.
At the top of each column, numbers are included. Each number represents the limit of how many work items can be added to the column. New numbers are pulled into the mix as capacity allows. This helps pinpoint potential bottlenecks in the workflow and areas where resources may need to be reallocated.
With this foundation in place, companies can begin to align their inventory needs with items that are used. As products are consumed, Kanban cards are generated (most often electronically) to signal the need for additional inventory. This message signals that materials either need to be moved to a production facility or to an outside supplier. Lean manufacturing was born!
The Benefits of Using Kanban to Manage Inventory
There are many benefits to managing inventory via Kanban systems. One of the main advantages of kanban manufacturing is to establish an upper limit to a flow of work. Since inventory is only restocked as it’s depleted, companies can easily identify which products are more successful than others. These feedback loops prevent overcapacity and improves lead times.
The amount of space needed to store inventory is also reduced. And costs associated with buying surplus items, some of which may never be used, decreases. Kanban manufacturing provides continuous improvement for your business. From customer orders to raw materials this software development keeps your business running smoothly.
Therefore the basic idea of Kanban is visualizing every piece of work on a board. This way, the Kanban board turns into a central informational hub. All tasks are visible and they never get lost, which brings transparency to the whole work process. Every team member can have a quick update on the status of every project or task. Kanban was created to meet actual customer’s demand just in time, rather than pushing goods to the market. Today, in knowledge work, Kanban makes it easy for us to respond to the ever-changing customer’s requirements. It allows teams to change priorities, re-organize or switch focus quickly.
How Managers Benefit By Using Kanban Manufacturing
Managers can further benefit from the system by running reports. From these real time visual representations, they can gain insight into improving workflow and organization.
It's like if the testing group in a manufacturing process can only handle three features a week, while the analyst group can handle six. With a cumulative flow diagram, managers can spot these gaps and reallocate resources to avoid bottlenecks. It’s always a work in progress. But as improvements are made to the process further opportunities for growth are created. That’s because the limit on the number of work items can fluctuate to reflect the improvements.
At iCONN, we use Kanban manufacturing to help customers who have had issues with suppliers in the past. Supplies are replenished in a timely manner based on customer demand, helping to reduce or eliminate waste in a manufacturing system. This not only helps clients save time and money, but it also helps lead to the development of higher-quality products.
Kanban’s flexibility allows it to be overlaid on existing workflows, systems and processes without disrupting what is already successfully being done; it will, naturally, highlight issues that need to be addressed and help to assess and plan changes so their implementation is as non-disruptive as possible. It is designed to promote and encourage incremental, logical, changes without triggering a fear of change itself. It is important that everyone fosters a mindset of continuous improvement in order to reach optimal performance on a team/department/company level. This can’t be a management level activity.
Overall, a Kanban system is more than sticky notes on the wall. The easiest way to understand Kanban is to embrace its philosophy and then apply it to your daily work. If you read, understand and resonate with the four core principles, the practical transition would seem logical and even inevitable. Visualizing workflow, setting WIP limits, managing flow, ensuring explicit policies and collaborative improvement will take your process far beyond you could think. Remember to organize regular feedback loops and all these pieces together will reveal the true power. With a Kanban inventory stocking program, a self-contained breathing apparatus manufacturer can optimize its manufacturing processes. Read the case study to learn how.