A kanban is a signaling system that provides authorization and instructions for the production or off-take (transport) of items in a pull system. The term is Japanese for "signal" or "sign. 

Kanban cards are the best-known and most widely used example of such a system. Often they are strips of cardboard, sometimes tucked into clear plastic sleeves, on which information such as the part name and number, external supplier or internal supply process, packaging quantity, storage address and consumer process address is printed. Sometimes the card also has a bar code printed on it for tracking purposes or automatic billing. 

Besides cards, kanban can also be triangular metal plates, colored balls, electronic signs or any other tool that can convey the needed information and prevent erroneous instructions. 

Regardless of form, kanban have two functions in a production process: they instruct processes to make products and they instruct material handlers to move products. The first use is called production kanban (or make-kanban: make- kanban), and the second is called decrease-kanban (or move-kanban: move-kanban). 

Production kanban tell an upstream process what type and quantity of products to make for a downstream process in the value stream. In the simplest case, a kanban chart corresponds to one container of parts, which an upstream process will make for the supermarket before the next downstream process. In the case of large batches - such as when using a forming press with very short cycle times and long changeover times - a signal kanban is used to initiate production when a minimum number of containers is reached. Signal-kanban are often triangular in shape and are therefore often called triangle-kanban

Although a triangle canban is standardly used in Lean production to plan a batch production process, other types of signal canban also exist. Other basic ways to regulate batch operations include pattern production and batch production (lot making). 

In pattern production , a fixed sequence or production pattern is created that is repeated continuously. However, the actual number produced each time in the cycle may be variable and can vary according to the customer's needs. For example, during an eight-hour cycle, parts A through F are always produced. (The complexity of the conversions may determine this sequence). 

The amount of stock in the central market depends on the length of the pattern replenishment cycle; a one-day cycle requires one day's stock in the market, a one-week cycle requires one week's stock. The main disadvantage of pattern production is that the sequence is fixed; you cannot switch from the production of part D to the production of part F. 

In the case of batch production, one creates a batch board, which contains a physical kanban for each container of parts in the system (see illustration below). When material is consumed from the market, the kanban are temporarily removed and returned to the manufacturing process. They appear on a board that shows all the part numbers and has a shaded space reserved for each of the kanban cards in the system.

An example of a batch boardL

batch board

A returned kanban card hung on the shaded space on the board indicates that stock in the market has been consumed; cards not yet returned represent stock still in the market. Once a predefined trigger moment is reached, the production operator knows to start producing a particular product to replenish the material in the market. 

Using a batch board returns information to the production process more often. Such a board indicates what has been consumed and works with smaller quantities than the signal canban. It also provides a visual representation of inventory consumption and draws attention to problems in the central market. However, sometimes many kanban cards are needed, and all those cards must be returned in a timely and faithful manner or the board will not be accurate. Planners and supervisors must have the discipline not to accumulate inventory before it is needed. 

Purchase canban authorize the transfer of parts to a process downstream in the value stream. They often take two forms: interprocess-kanban (for off-take from an internal process) and supplier-kanban (for off-take from an external supplier). 

In their original application around Toyota City, the cards were used for both purposes. However, because Lean production is often staggered, supplier canban for companies at greater distances are now often electronic. 

An example of a production and off-take canban:

Production and off-take kanban must work together to create a pull system: an operator in a downstream process removes the off-take kanban as soon as he uses the first item from a container. This kanban goes into a collection box located near him, and is picked up by a material handler. When the material handler returns to the upstream supermarket, the takeout kanban is attached to a new container of parts, which is then delivered to the downstream process.

When this container was removed from the supermarket, the production kanban on the container was removed and placed in another collection box. The material handler supplying the upstream process gives the kanban to that process. By doing so, he signals that a new container of parts is to be produced. As long as no parts are produced or moved when no kanban appears, a true pull system is maintained. 

There are six rules for effective use of kanban: 

  1. Customer processes order exactly the number of goods indicated on the kanban.
  2. Delivery processes produce exactly the number of goods and in the exact order specified on the kanban.
  3. No item is created or transported without a kanban.
  4. A kanban is always attached to all parts and materials.
  5. Defective parts and incorrect quantities are never sent to the next process.
  6. The number of kanban is carefully reduced to reduce inventories and expose problems.

An example of a signal and decline canban:

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