Written by Jason Haines

“The more inventory a company has, the less likely they will have what they need.” -Taiichi Ohno
 
The ultimate goal of Lean is to have one-piece flow and zero inventory in the system. Though this may never be achieved within the system, this is the pursuit of perfection by those who practice Lean. The purpose for this is to have the ultimate respect for people by giving them the leadership to learn new skills and build relationships. We all want less stress, more input, and better relationships with one another and Lean is the ultimate strategy to do this for a business. And one way that we can become a improved workplace is by reducing the amount of inventory in our system.

Though we may never get to zero inventory we can get to the what we need, or just in time (JIT) inventory through a Lean tool called Kanban. Kanban is a manufacturing system in which supply of components is regulated using an instruction card sent along the production line. Typically, these cards, or today a monitor alerting people, have information on them in order to let people know what is needed. This information is determined by the people of the factory and helps them know quantities, locations, amounts, and many other types of information.

Kanban was started by Taiichi Ohno when he wanted to make the Toyota Production System (TPS) more efficient. He noticed that there were places within the system with issues with because there wasn’t enough inventory. This led Ohno to develop the Kanban because he wanted to create a system that improved and maintained a high level of production. Kanban helped to eliminate bottlenecks within the system by keeping the right amount of inventory at workstations to keep them moving forward. Ohno wanted people to solve the problems in the system and not deal with problems of the system. Therefore, he did not want the line to stop because of no parts, but he did not want the line to keep running if there was an issue that needed to be solved.

Kanban was the early development of JIT and used controls to have the right amount of inventory at the line. There was never too little and there was never to much. Kanban grew into Toyota suppliers knowing when to deliver and supply their parts to the main manufacturing facility. With Kanban, Toyota was also able to build better supplier and customer relationships, have better communication throughout the facility, and produce only what the customer needed. I am aware that many people think that JIT has been the issue with the COVID-19 supply crisis, but the supply chain issue goes much deeper than JIT. A great deal of it has to do with not using true JIT, but I will address that at a later time.

Kanban, like many of the other tools used in Lean, takes discipline to use. With Kanban an organization will build better relationships with its employees, suppliers, and customers by freeing up communication lines that weren’t there before. Communication is key to organizations and to Kanban.

An example of how to put Kanban into practice is with a Kanban system I implemented into a hardware department for a partition manufacturer. There were issues with running out of and losing parts on hand from China. As many know well, when ordering from China you must order in extreme bulk. Mostly this is to keep the price low in addition to long lead times due to the shipment travelling across the ocean. Though not ideal, and detested by most Lean practitioners, many organizations think this is the best way to do business by ordering cheaper and in bulk from China. However, I used this bulk ordering to my advantage in the long run by using it to learn amounts and where the parts came from.

As I was learning the parts, I started to develop a card system that to use for the frontline people in the hardware department and for the people that were ordering the parts from our suppliers. This card system had a picture of the part, amount in the box, place of origin, usage per day, part number, usage per day, lead times, and part name. This helped all determine how many we needed to have on hand and when to reorder the parts, so we did not run out due to the long lead times coming from China. As I mentioned before, we do not have true JIT manufacturing in the United States.

After getting the cards prepared and developed the next step was to look at our MRP system for part usage. Now let me tell you, Lean and MRP systems are really enemies and usually cannot work together. But in this case, I needed the MRP system to arrange the department to set up commonly used parts at eye level and close to the operator. This helped operators get to parts much easier and reduce the amount of order errors that they had been having issues within the past. This organization and Kanban development also helped reduce the amount of time that operators were taking to pull orders.

Kanban can have many benefits in many ways, but it is mostly to keep the production line from stopping due to no inventory. It takes into factor the timings of how fast jobs are done and puts the right amount of inventory at the production line. It can do this for many facets of the production process, whether that be at the micro level of the job, or at a macro level like the full logistics of suppliers and producers.

When we want things to work, we find ways to make them work and take the time to get them to work right. Kanban, like many other tools of Lean, takes work and reviewing the process to see what makes it work stronger. It focuses on the process and not the people in the process. At the end of the day Kanban is part of the respect for people by improving the process to make it less less stressful and calmer to work in. This brings on the learning culture that helps people think more critically and deeper into the problem solving, building a better culture.

Helping you grow your business through process improvement!!