What is Kanban? A Brief Overview

As with Lean, a web search for definitions of the Japanese word Kanban will yield a variety of answers: "signpost", "billboard", "signal", "signal card" among others. At Ultriva, we define Kanban as more than a signal, but rather a signaling methodology that is a key component of Lean.

In our definition, Kanban has four primary components:

1) The signal -- At its core, Kanban is about the use of a signal or signals that represent an instruction to drive some sort of activity. The instruction, in a factory, for example, could be to build a component or order more parts.
2) Demand-Driven -- In Kanban, signals are demand-driven. A Kanban card is used to drive production because demand suggests the need for production. A supplier will get an order for components because their customer has consumed or will shortly consume all it's components.
3) Visual and Simple -- Kanban utilzes signals easily understood by the recipient. It could simply be the presence of a card that drives action or it could be some other kind of symbol that is not open to interpretation - an empty supply cart for example. Regardless of the type of signal, it's presence very clearly states: "order more", "Im out of... ", "build more....", etc.
4) And lastly, it puts the employees in control. When Kanban is utilized in a manufacturing business, for example, the employee should have total control to reorder a part or supply a part, based on an activity or process HE or SHE controls. Rather than have a semi-detached buyer order parts for a line employee, the line employee signals his need, setting off a chain that results in the replenishment of parts.

To illustrate, think of a bin full of widgets for a motor on a factory floor. The depletion of that bin prompts the usage of a card to signal the need for more widgets. That signal is received and filled by the supply room who brings out more parts to the factory floor. Bringing out those parts, now leaves the supply room near inventory depletion prompting the use of another card for the widget supplier. The recipient supplier sees the signal and schedules shipment and/or prodution as a result.


Signals prompt action, demand drives the signals, simple visual cues are used, and those employees who are part of the process ultimately drive activity.


So why does Kanban matter? Kanban is a key component of Lean. It helps create the link between the different cells in a supply chain to keep the chain moving. By clearly and simply communicating needs throughout the supply chain, waste is reduced and waste reduction ultimately results in significant financial benefits to its practicioners.


There is a lot more we can say about Kanban and we will in future posts.