How to Implement Kanban in Manufacturing

We’ve already talked about Kanban many times, so I’m not going to explain what it is again. But if you need a refresher on the basics, feel free to read this Step by Step Guide to the Kanban system first. J

Since Kanban originates in the production floors of the Toyota factory, we’ll discuss how to implement Kanban in manufacturing, the different approaches, and the benefits of Kanban in manufacturing.

Creating the Optimal Conditions for Implementing Kanban

In order to successfully implement Kanban in manufacturing, you need to make sure you have the right environment. The further you are from the ‘ideal’ condition, the harder it will be to implement the system and the larger the safety margin you will need to add to the system to ensure there are no problems.

The ideal conditions for implementing Kanban in manufacturing are the following:

1. Have a constant predictable demand for product.
2. Have only a few product variations or use many common parts between variations and making the products distinctive at the later (finishing) stages.
3. Have an established [single] flow for all processes.
4. Use small(er) dedicated machines.
5. Able to make quick changeovers and/or use Single Minute Exchange of Die (SMED) techniques.
6. Have repeatable and reliable production processes and/or use Total Productive Maintenance (TPM), 5S, operator-driven quality improvements, and standardized operations.
7. Collaborate with reliable suppliers.

Not fulfilling these conditions does not mean you can’t implement Kanban and JIT in your manufacturing process though. It simply means that you might need to put more time analyzing your processes and creating the right Kanban system. Usually, having irregular demand and a large number of product variations requires to use a CONWIP system. And unreliable machines can require using a larger safety factor in quantities than the one you use in your system.

But don’t worry if your environment is not ideal. Kanban in manufacturing is all about continuous improvement. So over time, expect to uncover issues, and make positive changes to your system.

Setting Up a Pull Production System

Kanban is part of Just in Time (JIT) and Lean Manufacturing. As part of the pull system, it controls the what, when, and how much of the production. And it’s purpose is to ensure you are producing only as much as customers are asking for, and not a piece more. In order to do this, Kanban relies on JIT to create a pull system.

To do this, there are several Kanban rules that can help you implement Kanban and set up a pull production system:

• The later process gathers product from the previous process, and the earlier process
• The later process informs the previous process of what to manufacture
• The previous process produces only what the later process requires
• No products or materials can be moved or produced without Kanban authority
• Defects should be identified as close to the source as possible and are not passed to the later processes.

In reality, production is rarely as simple as manufacturing just one product at a time cause it’s not economical nor fast enough even if rapid changeovers are done. Usually, production lines are used for making several products. And this can make it a bit more complicated to design the pull system appropriately.

The Different Kanban Systems for Your Manufacturing System

After setting the right environment, and the next step is choosing the right approach to implementing Kanban in manufacturing. The Kanban system you implement should fit your specific production needs and be designed accordingly. There 4 common approaches for applying Kanban in manufacturing that works for almost any business. Of course, you can implement one approach or mix and match as long as the process fits your company needs.

Kanban Cards and Kanban Bind

The Kanban cards approach uses simple cards [as signals] which are attached to the batch of material as it moves through the production line. Very often, for each product, there are only two to three cards in the system. But if you need to handle larger batches, or if the product itself is big, there may be more cards associated with it. Typically, the cards contain information about the product – what it is, where to use it, and in what quantity it should be available.

Depending on your process, you can use two or multiple cards. How does it work? In a two-card system, when a step in the process is done using the materials associated with a specific Kanban card, the attached card is returned to the previous step. The card is then used as a signal (authority) for the previous step to produce replacement parts. In a multiple-card system, the previous step needs to wait for a set number of cards to get back before they start to manufacture more parts/products.

The Kanban bins are used very similarly to the Kanban cards. But instead of using cards attached to the materials used in the process, the containers or bins that store them becomes the actual Kanban. When they are emptied, they are returned to the previous step as a signal to produce and be restocked. The bins are also labeled with similar information as the cards. If you are using Kanban bins though, it’s essential that the bins are dedicated for one material only, and nothing else.

CONWIP Systems

The acronym stands for Continual Work In Progress. This approach to Kanban in manufacturing most closely resembles supermarket shelves restocking – the Kanban is the actual location of the material or part – the empty floor space or shelf. This system’s production schedule depends on demand. The CONWIP approach has higher lead times and helps manufacturers lower levels of inventory compared to the use of cards of bins.

But, the drastically reduced lead times are possible only if JIT delivery is already set up and if the system can achieve near to one-piece flow and variation is limited. With a ‘make-to-order’ approach to planning, CONWIP can also be successfully applied within areas with a large amount of variation.

E-Ban and Fax-Ban Systems

With all the technology we have available today, it’s very easy to set up a paperless Kanban system. This can be done with the use of barcode scanners or machines that communicate with each other using electronic messaging. Both, the E-ban and Fax-ban help companies save time as cards or bins don’t need to be physically moved between processes. Instead, everything is communicated electronically, which in turn helps companies achieve JIT production.

Why Implement Kanban in Manufacturing?

Kanban is, time and again, one of the proven lean manufacturing tools that can significantly improve your production. You might think to yourself, ‘I already have a good production process, why change it and adopt some Japanese method’? Well, the Japanese are known for their superior productivity, aren’t they? If that’s not a reason good enough to consider implementing Kanban, I’ll speed-walk you through some of the main benefits.

Kanban is a lean manufacturing technique that aims to eliminate waste and make factories cut down on excess inventory and unused materials. This translates into smarter stocking, lower inventory and storage costs, minimal waste, and reduced overproduction. Since work is closely ties-up in WIP, all costs, including overhead, get significantly lowered over time. The system also enables the standardization of production, which leads to increased efficiency and fewer errors and defects. The workflow is improved, and that also improves teamwork and responsiveness to changes in demand.

But beware, Kanban does not work wonders overnight. You will need to provide the proper training and education for your employees. Implement a tailor-made Kanban system that fits your manufacturing needs. Then, patiently work on further developing and continually improving your Kanban manufacturing system. And the results will surely follow!