Kanban System

What is Kanban?

"Kanban" is Japanese for "sign" or "signboard." Used in production operations, it denotes a
signal for production to begin, or for material to be moved. Many manufacturers that have
embraced pullbased replenishment systems to manage some portion of their raw material and
work-in-process inventory use kanban cards, pieces of laminated cardstock attached to the
front of bins or other storage containers. Material handlers pick up and deliver the cards
between workcells and storage areas to signal to the next process upstream that it's time to
send more parts, and what quantities are required

Kanban Implemetation

Kanban can be implemented if there is a standardized stock with integrated information and performed by lean and highly productive manpower which supported by efficient space and handling. Each activity has interdependent among others. Therefore it is impossible to apply one activity and annoying the others.


Standardization Stock
As system for stock management or control, the stocks to be classified, delivery cycle to be regularly grasped. In addition, it is necessary to analyze the required stocks and excessive stocks through visible control. The classifications of parts is needed, such as:
1. Big parts
2. Small Parts

Turn Around Time (TAT) Standard

For sensitive correspondence to the demand trends, it is necessary to have the shortest lead times, there will be effect to a remarkable stock reduction. TAT is defined as the total lead time of kanban withdrawal, plus vendor respond for document preparation and loading parts, plus vendor transportation time, plus receiving process. So TAT is the overall combination of lead time. TAT can be described as a looping cycle process as seen on Figure  below:

The standard of each lead time is set as below:
1. kanban withdrawal = as trigger
2. Vendor respond  is total lead of document preparation and parts loading to the truck = 30 minutes
3. Vendor transportation lead time has range from 0.5 hrs to 4 hrs and 24 hrs, it relate to the vendor location and parts characteristic
4. Receiving lead time process from unloading, IQC check until data entry has maximum 30 minutes range.

Lead time of transportation can be defined based on vendor location as below:
1. R1 area has range between 0.5 to 1 hrs
2. R2 maximum 1.5 hours
3. R3 farther area have 2 hours
4. R4 Outtown side  has maximum 3 hours
5. Others to be grouped in 1 day lead time

In general TAT divided by 2 groups, TAT 0.5 to 0.5 and TAT 24. These relate to the treatment of parts movement control whether by hourly or daily. For TAT 24, is not necessary control by hourly, it is enough to be control by daily, and for TAT 0.5 to 24, has to be controlled hourly even minutes by minutes. 

Kanban Scheme

Based on 2 groups of TAT, stock max and minimum can be defined through the kanban scheme as below:

1. TAT 0.5 to 4 hrs

• Stock Max = TAT + a     (a = safety = 0.5 hr)

• Stock Min  =  a

• Kanban Time = TAT +a

• Kanban Size =  TAT

See Figure as the sample of stock simulation with using TAT 2 and suppose production capacity is 60 pieces/hour and working hour start at 6:30 till 15:15 for shift 1 and start again at 20:15 till 4:30 for shift 2. The maximum stock as shown has range between 2.8 to 4 hours; while the minimum stock is 1 to 1.8 hours. Different TAT has different variation as well the working hour also will make different stock fluctuation.

(to be continued...)