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Short History on KANBAN

kanban system is developed and started in 1940’s by TAIICHI OHNO for Toyota automotive in japan. A major Purpose for executed of the KANBAN system was insufficient productivity and efficiency of Toyota compare to American automotive competitors.

With kanban, Toyota executed a flexible and efficient production control system that increased productivity when reducing the cost-intensive inventory of material.

Kanban system preferably controls the chain from Vender to customer. Its bits of help avoid supply separation and overstocking of materials at various stages of the manufacturing process by the Kanban system. Continuous monitoring process requires in KANBAN System.The Objective is to realize higher throughput with lower delivery lead times. Over a time, kanban has become an efficient way in a variety of production systems.

What is the KANBAN system?

The Kanban Method is an objective to improve your company’s ability to deliver by applying the principles of visualization, limiting work in progress, and flow management on a system level. Not having the materials, whether it is a part, a document, or customer information, at the time you need it causes delays and waste. On the other hand, too much work in process (WIP) is also a form of waste. Kanban tool is managing the flow of materials or information (or whatever) in a process. Also, it is to learn and manage an optimal flow of work within the processes.
KANBAN term came to use as a “visual card,” “signboard,” or “billboard”, “signaling system” to indicate a workflow that limits Work In Progress. Direct Implementation of a Pull Scheduling system by Kanban concept.

The core concept of KANBAN includes:

Visualize Workflow: Divide the entire work into a defined state, visualized as named columns on a wall. Write each item on a card and put it in a column to indicate where the item is in the workflow.

Limit WIP: Assign exact limits to how many items can be in progress at each workflow state. i.e., In each workflow state, Work in Progress (WIP) is limited.

Measure the Lead Time: Lead Time is also known as cycle time. Lead time is the average time to complete one item. Measure the Lead Time and optimize the process to make the Lead Time as small and expected as possible.
Kanban is gaining traction as a way to smoothly implement Lean management methods in the technical and non-technical organisation around the world. Throughout, Kanban’s have four core elements principles:

  1. Visualize Work- By Preparing a visual model of your work station and workflow, you can observe the flow of work moving through your Kanban system. Making the work visible—along with blockers, bottlenecks, and progression—instantly lead to increased communication and collaboration.
    2. Limit Work in Process- By limiting how much-incompleted work is in process, you can decrease the time it takes an item to travel through the Kanban system. You can also ignore problems caused by task switching and decrease the need to constantly reprioritize items.
    3. Focus on Flow- By using work in process (WIP) limits and developing team-driven policies, you will optimize your Kanban system to enhance the easy workflow, collect metrics/data to analyze flow, and even get major indicators of future problems by analyzing the workflow.
    4. Continuous Improvement- Once your Kanban system is established, it becomes the keystone of a culture of continuous improvement. Teams evaluate their effectiveness by tracking flow, quality, throughput, lead times, and more. Experiments and analysis will change the system to improve the team’s effectiveness.
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KANBAN Benefits

KANBAN is more successful because it visually indicates when the production should start and stop. It is faster, more efficient, and saves money over most other production models. It is also much more directly responsive to customer demand.

KANBAN has the following commonly observed benefits –

  • Bottlenecks become visible in real-time. This leads people to cooperate to optimize the whole value chain rather than just their part.
  • Useful for situations where operations and support teams have a high rate of uncertainty and variability.
  • Trends to expand throughout the organization naturally, including sales and management. This increases the visibility of everything, that is going on at the company.
  • Reduces inventory in the range of 25%-75%, thereby reducing company costs.
  • Since all states in the flow of works are visually organized, the required items, decreasing the waiting times and ensuring speed, continually support all the tasks in the flow of works.
  • Overproduction of inventory is avoided, thereby saving resources and time as well. This is termed as eliminating waste.
  • Reduces inventory
  • Improves flow
  • Prevents overproduction
  • at the operations level Places control (with the operator)
  • Creates visual Planning and management of the process
  • Improves responsiveness to changes in demand
  • Minimizes risk of inventory obsolescence
  • Increases ability to manage the supply chain

Why Implement KANBAN?

KANBAN is one of the most effective workflow management methods. But here the following reason for why we implement KANBAN

Reasons for Implementing a Lean KANBAN System:

  1. Visualizes your work- KANBAN has changed your production planning into visual KANBAN boards, KANBAN cards, or electronic e-KANBAN signals. A value stream map (VSM) is used to understand your KANBAN needs. All Employees will see what the current production plan is easily and quickly by reading the visual KANBANs.
  2. Reduces your Work In Progress (WIP)A lean KANBAN is built by balancing your work cells to the pull of customer demand using KANBAN signals. Lean balanced workflow reduces Work In Process created by batch sizes that are larger than customer orders.
  3. Moves your work along steadily- A balanced workflow is achieved by understanding the takt time or flow of customer demand and then adjusting individual work state batch sizes to achieve the steady balanced product flow. Your worker’s jobs are now even, steady, set to a comfortable frequency that satisfies customers and management.
  4. Improves your workflow- A steady balanced product flow is a great process improvement over traditional chaotic systems made of large batch sizes. The whole system operates together as a team reducing employee stress levels and adding calm to the organization.
  5. Releases your work on demand –New orders generate the system to produce the next batch. A balanced system only produces sufficient products to fulfill customer demand and hence only releases orders on demand.
  6. Simplifies your production planning –Your production planning is reduced to adjusting the KANBAN range as market conditions change. A steady balanced manufacturing flow sets the order turnaround time removing expedited orders and special rush jobs that are the burden of traditional production planning. In effect, all orders are facilitated when you balance the flow to customer demand.
  7. Eases your purchase planning –Purchasing becomes balanced with production KANBANs and can be simplified even more using e-KANBANs that automatically send purchase orders directly to suppliers.
  8. Increases your customer satisfaction –The real aim of a KANBAN is to understand what all customers requirement and then focus your production on that customer requirement. When customers get what they want, when they want it, they become very satisfied customers. That is the value of a KANBAN competitive advantage.
  9. Eliminates your employee confusion –Simplified production- purchase planning, and simplified work states all lead to a simplified system. Employees can see the simplification and easily understand the flow. Confusion is virtually eliminated.
  10. Minimizes your overproduction risks –Inventory can become obsolete quickly in a fast-changing market. A KANBAN will decrease your exposure to excessive older inventory by focusing your production on customer demand instead of production planning. If you only make what you need then there is little obsolete inventory/material risk.

How to Implement a KANBAN System?

For the KANBAN system Implement, First, commit the improvement. There are seven steps in the implementation of the KANBAN system. These steps allow you to determine your current situation, what you want to achieve, and how you want to achieve it.

  1. Conduct Data Collection
    In this phase, you will collect the required data to characterize your production process. The act of gathering data will allow you to make a decision based on facts instead of desires or gut hunches. This data will allow you to calculate the KANBAN quantities (which is the next step). As you proceed through this step, be honest about the process’s actual capabilities so that you can calculate realistic KANBAN quantity that supports customer demand.
  2. The KANBAN Size
    Once you realize where you are, you can calculate the size of the KANBAN. Initially, you will calculate the KANBAN container size based on current conditions, not based on plans or desires. However, the last step will focus you on ways to decrease KANBAN quantities based on a practical continuous improvement approach. The primary calculations will utilize the production requirement, the system scrap rate, the process productivity rate, planned downtime, and changeover times to calculate a replenishment interval. The final KANBAN container quantity will also include a buffer for safety stock and to account for any process, drying. These calculations will basis for the KANBAN design in the next step.
  3. Design the KANBAN
    Once you have calculated the KANBAN quantity required to production requirements based on current conditions, you are ready to develop a design for the KANBAN. The concluded KANBAN design will answer the question of how you will implement the KANBAN system. The design will consider:

    • How will the material be controlled?
    • What are the visual signals?
    • What will be the rules for conducting the KANBAN?
    • Who will handle the KANBAN transactions?
    • Who will make the scheduling decisions?
    • Who will resolve problems?
    • What visual management items will be needed?
    • What training will be required?
    • What is the implementation schedule?
      The end product at this step should be a plan for the execution of the KANBAN, including execution actions, action tasks of work, and program milestones. As you finish the design step, don’t be afraid to commit to the start date. Don’t be guilty of analyzing yourself into inaction. Collect a start date, build a plan to this date, and monitor the plan for progress toward bitting this date.
  4. Everyone
    Before starting to program with KANBAN, don’t forget to educate everyone on how the system will work and on their role in the process. Prepare a simple presentation to explain the process and visual signals. Also, review the rules during the training. Take the participants through what-if scenarios to help them understand their roles and the decision-making process. Perform a dry run so that everyone knows how the KANBAN signals will be handled and what the signals mean. Keep the training focused on operating the KANBAN. Don’t try to make everyone a KANBAN expert—just educate them on their area.
  5. The KANBAN
    Once you have a KANBAN design and training completed, you can start the implementation of the KANBAN. Before you implement the KANBAN system, make sure you have all your visual management system in place. Having the signals set up, control points marked, and the rules finalized and coordinated before you start will avoid confusion and make training much easier. As you deploy the KANBAN, anticipate problems that may impact the success and take action to prevent or mitigate these problems. Finally, during the deployment stage, develop a transition plan—decide the exact point for the change and the quantity of inventory required to make the change.
  6. Audit and Maintain the KANBAN
    After the KANBAN starts, you must begin the next step of the process—auditing the KANBAN. Auditing is the step that generally gets overlooked in most failed start-ups. So, when designing the KANBAN system, identify who will audit the KANBAN system. Typically, the auditor will be watching how the planning signals are handled and whether the customer stays supplied. When the auditor finds issues, then the issues need to be fixed immediately by the responsible person to maintain the integrity of the KANBAN design. Taking action prevents the KANBAN from being pronounced a failure by the operators. The auditor will also look at future requirements to make sure the KANBAN quantity meets the expected requirement. If you don’t adjust the KANBAN quantity to forecasted demand, then expect to continually intervene manually in the scheduling process (a sure way to kill the KANBAN).
  7. Improve the KANBAN
    After the KANBAN system starts, the next step of the process auditing the KANBAN system. Auditing is the step that generally gets overlooked in most failed startups. So, when preparing the KANBAN system, identify who will audit the KANBAN system. Typically, the auditor will be watching how the planning signals are handled and whether the customer stays supplied. When the auditor finds issues, then the issues need to be fixed immediately by the responsible person to maintain the integrity of the KANBAN design. Taking action prevents the KANBAN from being pronounced a failure by the operators. The auditor will also look at future requirements to make sure the KANBAN quantity meets the expected requirement. If you don’t adjust the KANBAN quantity to forecasted requirements, then expect to continually intervene manually in the planning process (a sure way to kill the KANBAN).

Keys to Successful Implementation of KANBAN

Many organizations refuse/fail to implement KANBANs due to their fears.Theyfeara lossofcontrol,theyfeartheiremployeeslackability, they fear running out of material, they fear. . . . The answer to these fears is to develop plans that resolve these fears. Yourresponse to thesefears should beto put plans inplace to prevent them from becoming reality so that the organization can reap the benefits of KANBAN scheduling. Because we need you to be successful in implementing KANBAN system, we have identified various factors that greatly add to the chances of success. the following items lead to successful implementation,

  • Size the KANBAN to current conditions.
  • Adapt container size to allow flow.
  • Make KANBAN signals visual.
  • Develop rules that provide decision points plus checks and balances.
  • Educate the operators to run the KANBAN system.
  • Set up audit schedule to keep assumptions current and maintain system discipline.
  • Develop a phased improvement plan to decrease the KANBAN quantity.

Where to implement the KANBAN system?

In Organisation followed Push type production system, here we implement the KANBAN system.

While the KANBAN system is used beyond the factory floor – from software development to hiring to marketing – it is still a necessary part of an efficient and effective inventory system.

KANBAN is also being applied in traditional project management contexts such as construction and engineering projects.

Why the KANBAN system is Fail.

Probably the most common problem I see among KANBAN team does not maintain the board up to date.

  1. Board updates
    For as long as the board is not maintained up to date, anything that you do, and it is based on the board information will be based on incorrect information.
  2. Imagined processes
    Also, a common issue is making the board look like the process that the team needs to have, rather than the one that they have. This adds to the incorrect board information, a way of making the team not just base their actions on rest, but also work through a net of non-existent process steps.
  3. Suspiciously complex boards
    Another typical problem is over-complicating the boards. Why make something basic complex? The idea of a KANBAN board system is to make work easier, there is no need to apply every trick in the book just to make it seem more complex – no-one needs this.
  4. Overlooked WIP limits
    A standard problem for failing KANBAN system is not taking WIP limits seriously. If you are not going to take them into account and favor, you might as well stop using words like KANBAN, improvement and better flow of work entirely, because you are not going to be doing any of those.
  5. The role that KANBAN plays
    As the last of KANBAN system failure causes, Pawel mentions the very core of what KANBAN system is and is not. According to him, the KANBAN system is a great change management technique, a way of implementing a new system – a process driving tool, but not an entire process with rules and regulations on how to make your process work and work well. So, what recommends is having a set of underlying rules, or even another management technique below KANBAN. The underlying technique shall be setting the tone and detailed shape for the work you do.
    With keeping these indications in check and staying serious about making your process strong, true, and a little fuller than just built on KANBAN’s change management approach, chances are this will work out. So, if you’re still wondering about the one way to make KANBAN system work, it is maintaining the board updated and in line with the real process.

Limitation of KANBAN system.

KANBAN cannot be used as an independent tool. It is not a methodology that could be applied solely rather it can be merged with other processes and systems of a company like JIT, make to order and scrum, etc. making these systems more visible.

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