Kanban

Kanban is the Just in Time (JIT) concept where two bin signals are used to control inventory consumption and avoid excess inventory buildup. Inventory is replenished only after consumption. This is a controlled process of inventory management using Pull rather than push.

Kanban two bin system

Normally, Kanban process is very successful for suppliers located at a nearby distance.

Setting up Kanban Process

Card Setup Process

Items and suppliers selected for Kanban will have fixed quantity redemption. This is called card size. For example, there will be two bins of quantity 1000 each. This is called Kanban card setup process

Printing of Kanban Cards

Barcoded Kanban cards are to be printed from the system. These barcodes can be printed on small labels or large sheets that are to be fixed on to the bin. Once the card labels are attached to the bins, they are not to be removed.

Kanban Barcode

Refill Signal

When one bin becomes empty or it is moved from stores to shop floor, the machine operator or the store’s manager scans the barcode on the Kanban card. This will trigger the refill signal and will send email alert to the supplier informing the supplier that the bin has been consumed.

As soon as the refill signal is received, supplier starts preparing the replacement bin with material. This is one of the major difference in electronic Kanban. In traditional manual Kanban, supplier will come to know that the bin has been consumed only when they receive the card or the empty bin.

Supplier Ship

Once supplier receives the empty bin, they swap it for the full bin and ship the full bin. They can scan the same bar code to mark the Kanban card as shipped. As soon as supplier scans the Kanban card, system sends an email alert to the receiver that the full bin is on its way.

Receive Kanban Card

When the full bin arrives at the receiving location, receiver scans the same card to receive the material into their warehouse. This will mark the card status as Full. The cycle will continue like this.