Kanban Definition

Cite this article as:"Kanban Definition," in The Business Professor, updated March 21, 2019, last accessed December 4, 2020, https://thebusinessprofessor.com/lesson/kanban-definition/.


Kanban Definition

Kanban is a scheduling system used in lean and just-in-time manufacturing. The system was developed by the Vice President of Toyota, Taiichi Ohno. This inventory control system is named after colored cards used in tracking production and managing new shipment orders.

A Little More on What is Kanban

The Kanban system aims at making both suppliers and buyers visible at all the times. It ensures there is no excess inventory and the development and production teams are not overburdened. In this system, pressure is applied by the buyers; when the demand for products is high, production is increased. The system observes that, in cased when inventory limits are exceeded, there is an efficiency that needs to be addressed.

When using this system, color-coded cards are used. When parts and materials are emptied from storage containers, a card is delivered to tell the production team to produce more before a shortage is experienced. Two cards are used: a T-Kanban signals the container to move to the next workstation and a P-Kanban signals workstations to produce a given amount of products or product parts.

To enhance the efficiency of the Kanban system, electronic Kanban, E-kanban systems are used by Toyota, Ford Motors and Bombardier Aerospace among others.

A good example of Kanban system is CONWIP in which production of a new product is triggered by the finishing of another product on the production line.

References for Kanban

Academic Research on Kanban System

  • Toyota production system and kanban system materialization of just-in-time and respect-for-human system, Sugimori, Y., Kusunoki, K., Cho, F., & Uchikawa, S. (1977). The International Journal of Production Research, 15(6), 553-564. This paper introduces the Kanban system and shows how effectively it works. It looks at a brief history of the system, which was developed by Taiichi Ohno. The paper observes that Taiichi Ohno guided the system until it became successful in Toyota Motor Company where it has been used for more than 20 years. The paper observes that Kanban system has two features; just-in-time product and respect-for-human system. In JIT, only the necessary products, at the necessary time and quantity are produced. In the second feature, those in development and production are allowed to show their creativity by managing their workshops.
  • Variations of the kanban system: Literature review and classification, Junior, M. L., & Godinho Filho, M. (2010). International Journal of Production Economics, 125(1), 13-21. There are different kanban systems and this paper seeks to explain how each of the system performs. It examines 32 systems and classifies them into six categories. It studies the variations between the new systems and the original system as well as the shortcomings of these new variants of the original Kanban. After examining the variants, the author shows how the Kanban system can be improved to meet the needs of production systems. The paper offers insights on the literature of the Kanban system.
  • A mathematical programming approach to a deterministic kanban system, Bitran, G. R., & Chang, L. (1987). Management Science, 33(4), 427-441. The author in this paper has developed a mathematical programming system that is meant to better the Kanban system in a production setting. It offers a solution to problems that may be experienced during the production process giving three practical cases.
  • Literature review of JIT-KANBAN system, Kumar, C. S., & Panneerselvam, R. (2007). The International Journal of Advanced Manufacturing Technology, 32(3-4), 393-408. This paper examines the literature of JIT-Kanban. It starts by analyzing the concept of push/supply and pull/demand. It looks at blocking mechanisms in Kanban systems and why evaluating performance is important in Kanban systems. The paper also addresses emerging issues in Kanban and reviews 100 research papers to offer insights into future research and improvement of the system.
  • Lean manufacturing case study with Kanban system implementation, Rahman, N. A. A., Sharif, S. M., & Esa, M. M. (2013). Procedia Economics and Finance, 7, 174-180. In Japan, most companies have adopted lean manufacturing. The system aims at reducing costs in production and reducing inventory bulk. However, SMEs in Malaysia have not adopted the system as this paper observes. This paper, therefore, examines how the Kanban system can be applied in multinational organizations and why the system has not been taken up by SMEs in Malaysia.
  • Flexible kanban system, Gupta, S. M., Al-Turki, Y. A., & Perry, R. F. (1999). International Journal of Operations & Production Management, 19(10), 1065-1093. Just-In-Time Kanban systems are great where uncertainties are not common. Cards can be used to authorize production. However, most industries are marred with uncertainties including fluctuations in processing time, unpredictable demand and unplanned interruptions such as equipment failure. The author in this paper has developed a new model of Kanban christened Flexible-Kanban that seeks to address uncertainties. The author conducts numerous tests on the system to show how superior and effective the Flexible-Kanban system is.
  • A system dynamics model for a multi-stage multi-line dual-card JIT-kanban system, Gupta, Y. P., & Gupta, M. C. (1989). THE INTERNATIONAL JOURNAL OF PRODUCTION RESEARCH, 27(2), 309-352. In this paper, the author examines the JIT-Kanban system. It shows that, JIT production systems have been adopted by different businesses in different industries. The system allows production lines to produce only the required quantity of products. In JIT-Kanban systems, production is pulled by demand and not planned push. The author looks at some of the unique characteristics of the JIT-Kanban system.
  • A comparative analysis of an MRP lot-for-lot system and a Kanban system for a multistage production operation, Rees, L. P., Huang, P. Y., & Taylor III, B. W. (1989). International journal of production research, 27(8), 1427-1443. This paper examines the JIT system as used in Japanese production systems. The system has gained a lot of popularity among production managers in America. The paper aims at testing the effectiveness of the JIT-Kanban system in an all-structured production system. It compares the efficiency and effectiveness of the Kanban system and the conventional MRP lot-for-lot scheduling system. The paper uses a hypothetical production line with all the needed production centers.
  • Decentralized reactive Kanban system, Takahashi, K., & Nakamura, N. (2002). European Journal of Operational Research, 139(2), 262-276. This paper observes that, there are lots of unstable changes in a multi-stage production system. It proposes a new system, the decentralized reactive Kanban system where production is monitored at individual stages rather than from one stage. In this new system for the detected uncertainties, the buffer size in each production stage is controlled. The paper shows simulation experiments that test the new system. The experiments consider unstable demands and how the system can be used to enhance production.
  • Operations planning for a multi-stage kanban system, Sarker, B. R., & Balan, C. V. (1999). European Journal of Operational Research, 112(2), 284-303. This paper is a review of the JIT-Kanban system. It shows the different processes in different workstations in a production line. It starts by examining the processing of raw materials after they are received from suppliers and the problems that are experienced before these raw materials are developed into finished products. It develops a cost function to enable production managers calculate costs due to raw materials, processing and finishing the goods. This is also used to determine the optimal number of orders for raw materials.
  • Configuring a kanban system using a discrete optimization of multiple stochastic responses, Davis, W. J., & STUBITZ, S. J. (1987). International Journal of Production Research, 25(5), 721-740. This paper examines the production the use of Kanban system for a door manufacturing company. The author develops a simple Kanban system to be used by door manufacturers and uses discrete optimization to configure the model Kanban system. It shows the difficulties that may be experienced in such a system.

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