Kanban at the factory

Kanban is a smart stock method used in diverse organizations. What is it, and how does kanban work at a factory?

What is kanban?

Kanban is a visual and accessible way to manage your stock and exchange production orders. An empty hopper prompts the supply station to fill the hopper. The actual supply prompts replenishing. Kanban uses fixed order volumes, thereby optimizing the process.

The advantage of kanban is a grip on the supply level. There is balance in the logistical stream because there’s always an optimal supply level at the right place.

The difference between kanban and MRP

You can also determine your supply need based on computer-assisted MRP (Material Requirements Planning), where the system calculates what materials you need at what time. The system takes supply and delivery times into account. MRP encourages you to order the right amount, this being the economic ideal.  

However, the set-up leads to much variation and ambiguity for both buyers and suppliers. Also, it’s unclear whether the data is accurate: has the stock been updated? Besides, MRP uses prognosis: “according to the system, the day after tomorrow, you will have eight units left.” But is that actually the case? A decoupled system like kanban eliminates these insecurities.

Kanban: a visual cue

Kanban is a visual cue to help you always keep your supply balanced. By smartly using historical data to determine the right order volume, it’s easy to configure the system to make sure there’s always enough stock and no stress.

Kanban works best with containers or hoppers of all sizes. When you use two containers with ten pens, and one container is empty, it will be replenished, and no one will miss out. It’s the same for potatoes: the principle is that you order per container. When one is empty, the other will be sufficient to anticipate maximum usage while the empty container is being replenished.

Kanban at the factory

Kanban works very well for handling materials with short delivery times that are used regularly. With longer delivery times, incidental usage, or high stock costs, kanban is less interesting.

Using kanban stimulates redesigning the process and using the same materials as much as possible. When you use one material in many products, the variation in usage is much lower. This way, it’s possible to order large quantities and reduce costs. A more stable usage introduces rest in the production environment because it’s adapted into it.

Kanban and LEAN ERP

Kanban is a great way to simplify and improve stock management. However, it is not an automated process. That’s why Cierpa Software will soon launch a system that will change the game: the system will bring kanban and LEAN ERP together.

The custom-designed software makes it easy to determine the volume of the kanbans and simplify its management. It will be easy to record actual usage, prompting when to reorder, taking delivery times into account. It’s also possible to digitally scan a kanban and to transform it into a work order. This way, it’s possible to integrate kanban and LEAN ERP perfectly.

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