Unit 4: The Kanban Principle

Lesson 1: Drafting Kanban

Lesson 2: Using Kanban in Production

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Lesson 1: Drafting Kanban

Lesson Objectives
After completing this lesson, you will be able to:

Explain the characteristics of the Kanban principle

Unit 4 Lesson 1

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Figure 61: Application Areas

Unit 4 Lesson 1

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Figure 62: Kanban Principle

Unit 4 Lesson 1

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Figure 63: Kanban: Characteristics

Unit 4 Lesson 1

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Summary
You should now be able to:

Explain the characteristics of the Kanban principle

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Lesson 2: Using Kanban in Production

Lesson Objectives
After completing this lesson, you will be able to:

Describe the main steps of the Kanban procedure

Unit 4 Lesson 2

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Figure 64: Using Kanban in Production

Unit 4 Lesson 2

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Figure 65: Master Data: Production Supply Area

Unit 4 Lesson 2

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Figure 66: Master Data: Kanban Control Cycle

Unit 4 Lesson 2

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Figure 67: Production Supply Using Control

Cycles

Unit 4 Lesson 2

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Figure 68: Setting the Kanban to Empty =

Triggering Replenishment

Unit 4 Lesson 2

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Figure 69: Setting Kanban to Full = Posting

Goods Receipt

Unit 4 Lesson 2

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Figure 70: Plan-Controlled Production versus

Kanban

Unit 4 Lesson 2

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Unit 4 Exercise 19

Exercise 19: Check a Kanban Material

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Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Check the material and supply area prerequisites first.
Verify Kanban Material Settings and Supply Area

Component T-T7## (BIOS) is procured using Kanban. Check to see if the master data is
set up correctly for Kanban.
1. Check whether material T-T7## in plant 1200 at storage location PL03 is excluded
from MRP, so that its replenishment elements are not generated via MRP but via
Kanban.
2. Is this material excluded from MRP at storage location PL03?

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Unit 4 Exercise 19

Exercise 19: Check a Kanban Material

.
____________________________________________________
____________________________________________________
3. Is the same material T-T7## also excluded from MRP at storage location 0001 in
plant 1200? Hint: Select Organizational Levels, then enter 0001 in the Storage
Location field and choose ENTER.
____________________________________________________
____________________________________________________
4. Which MRP indicator is set for this material at storage location 0001?
____________________________________________________
____________________________________________________
5. Review the stock/requirements list for material T-T7## in plant 1200.
Write down the available quantities (stocks):
____________________________________________________

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Unit 4 Exercise 19

Exercise 19: Check a Kanban Material

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6. How does the system display materials that are excluded from MRP at a storage
location in the stock/requirements list?
____________________________________________________
____________________________________________________
7. Supply area T-P3## has been set up to stage materials at the production line.
Display the supply area T-P3## in plant 1200 by going to the control cycle.
To which storage location and person responsible is the supply area assigned?

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Unit 4 Solution 19

Solution 19: Check a Kanban Material

.
Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Check the material and supply area prerequisites first.
Verify Kanban Material Settings and Supply Area

Component T-T7## (BIOS) is procured using Kanban. Check to see if the master data is
set up correctly for Kanban.
1. Check whether material T-T7## in plant 1200 at storage location PL03 is excluded
from MRP, so that its replenishment elements are not generated via MRP but via
Kanban.

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Unit 4 Solution 19

Solution 19: Check a Kanban Material

.
a) SAP ECC menu path: LogisticsProductionMaster dataMaterial
masterMaterialDisplayDisplay current (MM03)
b) Choose Enter and select the MRP 4 view.
c) Select

Continue.

d) Enter plant 1200 and storage location PL03.

e) Select

Continue.

2. Is this material excluded from MRP at storage location PL03?

____________________________________________________
____________________________________________________
a) Yes. Material T-T7## is excluded from MRP at storage location PL03, as you
can see from the Storage Location MRP indicator.

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Unit 4 Solution 19

Solution 19: Check a Kanban Material

.
3. Is the same material T-T7## also excluded from MRP at storage location 0001 in
plant 1200? Hint: Select Organizational Levels, then enter 0001 in the Storage
Location field and choose ENTER.
____________________________________________________
____________________________________________________
a) No. Material T-T7## is not excluded from MRP at storage location 0001.
4. Which MRP indicator is set for this material at storage location 0001?
____________________________________________________
____________________________________________________
a) The MRP indicator for material T-T7## at storage location 0001 is set to blank,
which means that at storage location 0001, the material is planned using MRP.
5. Review the stock/requirements list for material T-T7## in plant 1200.
Write down the available quantities (stocks):
____________________________________________________

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Unit 4 Solution 19

Solution 19: Check a Kanban Material

.
a) SAP ECC menu path: LogisticsProductionMRPEvaluationsStock/
reqmts list (MD04)
b) Enter material T-T7##, plant 1200 and select

Continue.

6. How does the system display materials that are excluded from MRP at a storage
location in the stock/requirements list?
____________________________________________________
____________________________________________________
a) Materials that are excluded from MRP at a storage location are displayed in an
individual planning segment in the stock/requirements list.
7. Supply area T-P3## has been set up to stage materials at the production line.
Display the supply area T-P3## in plant 1200 by going to the control cycle.
To which storage location and person responsible is the supply area assigned?

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Unit 4 Solution 19

Solution 19: Check a Kanban Material

.
a) SAP ECC menu path: LogisticsProductionKANBANSupply
AreaDisplay (PK06)
b) Enter plant 1200, and select

Continue.

c) Scroll to find your supply area T-P3## and select

Details.

d) The supply area is assigned to storage location PL03 and the person
responsible is L3.
e) Select

Back twice.

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Unit 4 Exercise 20

Exercise 20: Check the Kanban Control Cycle

.
Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Verify the Kanban Control Cycle Settings

In plant 1200, component T-T7## (BIOS) in supply area T-P3## is to be staged directly at
the production line.
1. Review the control cycle to see which replenishment strategy is used to stage
material at the production line.
2. Since we are dealing with a control cycle for external procurement, the supply
source in this case is a vendor. Which supply source has been entered in the
control cycle for replenishment of component T-T7##?

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Unit 4 Exercise 20

Exercise 20: Check the Kanban Control Cycle

.
____________________________________________________
____________________________________________________
3. What method of external procurement is being used? Finally, leave the transaction.
____________________________________________________
____________________________________________________

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Unit 4 Solution 20

Solution 20: Check the Kanban Control Cycle

.
Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Verify the Kanban Control Cycle Settings

In plant 1200, component T-T7## (BIOS) in supply area T-P3## is to be staged directly at
the production line.
1. Review the control cycle to see which replenishment strategy is used to stage
material at the production line.
a) SAP ECC menu path:LogisticsProductionKANBANControl
CycleControl Cycle Maintenance (PKMC)

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Unit 4 Solution 20

Solution 20: Check the Kanban Control Cycle

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b) Use the extended selection and enter material T-T7##, plant 1200, supply area
T-P3## and select Execute.
2. Since we are dealing with a control cycle for external procurement, the supply
source in this case is a vendor. Which supply source has been entered in the
control cycle for replenishment of component T-T7##?
____________________________________________________
____________________________________________________
a) The supply source is vendor 2 (Electronic Components Distributor).
3. What method of external procurement is being used? Finally, leave the transaction.
____________________________________________________
____________________________________________________
a) Purchase orders are used, as you can see from the external procurement
replenishment strategy.

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Unit 4 Exercise 21

Exercise 21: Proceed Kanban Execution

.
Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Determine the current Kanban situation in the system. If your stock situation requires it,
replenish the BIOS chip T-T7##, with the Kanban technique.
Carry out the Kanban Process

1. Access the demand source view of the Kanban board for supply area T-P3## in
plant 1200.
2. How many containers are there in the SAP ECC system for replenishment of
material T-T7##?
____________________________________________________

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Unit 4 Exercise 21

Exercise 21: Proceed Kanban Execution

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3. Let us assume that you, as the demand source, have just taken the last component
out of a Kanban container. From the Kanban board, select one of the Kanban bins
for material T-T7## and set it to empty.
4. In order to check the result of your action, go directly from the Kanban board into
the stock/requirements list.
5. For what quantity has a purchase order been created?
____________________________________________________
6. What is the current available quantity of material T-T7## at storage location
PL03?
____________________________________________________
7. Let us assume that you have just received a full container from the supply source.
In the Kanban board, set the Kanban for material T-T7## to full.

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Unit 4 Exercise 21

Exercise 21: Proceed Kanban Execution

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8. What is the result in the stock/requirements list? Hint: Select the row in the
Kanban board for material T-T7## and choose from this transaction menu path
Goto->Current stock/reqmts list.
____________________________________________________
____________________________________________________

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Unit 4 Solution 21

Solution 21: Proceed Kanban Execution

.
Business Example
In plant 1200, you use repetitive manufacturing to produce the mother board assembly TB10##. In order to produce the assembly, the component T-T7## (BIOS) must be staged
directly at the production line. Stocks of this component are replenished via external
procurement from vendor 2 (Electronic Components Distributor) using Kanban. The
components are delivered directly to a supply area, which is directly at the production line.
Determine the current Kanban situation in the system. If your stock situation requires it,
replenish the BIOS chip T-T7##, with the Kanban technique.
Carry out the Kanban Process

1. Access the demand source view of the Kanban board for supply area T-P3## in
plant 1200.
a) SAP ECC menu path: LogisticsProductionKANBANControlKANBAN
BoardDemand Source View (PK13N)

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Unit 4 Solution 21

Solution 21: Proceed Kanban Execution

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b) Set selection to supply area, enter supply area T-P3## enter plant 1200.
c) Select

Continue.

2. How many containers are there in the SAP ECC system for replenishment of
material T-T7##?
____________________________________________________
a) Five containers are available for replenishment of material T-T7##.
3. Let us assume that you, as the demand source, have just taken the last component
out of a Kanban container. From the Kanban board, select one of the Kanban bins
for material T-T7## and set it to empty.
a) Select one of the purple containers and select To Empty (Set Kanban Status
to Empty).
Wait until you see the status change (color change of the container).

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Unit 4 Solution 21

Solution 21: Proceed Kanban Execution

.
4. In order to check the result of your action, go directly from the Kanban board into
the stock/requirements list.
a) Select the row in the Kanban board for material T-T7## and choose from this
transaction menu path: GotoCurrent stock/reqmts list.
5. For what quantity has a purchase order been created?
____________________________________________________
a) A purchase order has been created for a quantity equal to the Kanban
container quantity (20 pieces).
6. What is the current available quantity of material T-T7## at storage location
PL03?
____________________________________________________
a) This varies. Write down the number belonging to PL03 that can be seen in the
stock-/requirements list. Choose the Back button.

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Unit 4 Solution 21

Solution 21: Proceed Kanban Execution

.
7. Let us assume that you have just received a full container from the supply source.
In the Kanban board, set the Kanban for material T-T7## to full.
a) Select the empty Kanban bin and select To Full (Set Kanban Status to Full).
Wait until you see the status change (color change of the container).
8. What is the result in the stock/requirements list? Hint: Select the row in the
Kanban board for material T-T7## and choose from this transaction menu path
Goto->Current stock/reqmts list.
____________________________________________________
____________________________________________________
a) Because a goods receipt has been posted for the Kanban container quantity
(20 pieces), the available quantity for material T-T7## at storage location
PL03 has increased by 20 pieces as you can see from the quantities you noted
before. The purchase order is no longer displayed.

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Summary
You should now be able to:

Describe the main steps of the Kanban procedure

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Open Question

What are the objectives of the Kanban procedure?

Unit 4

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Open Question

What are the objectives of the Kanban procedure?

Unit 4

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The following objectives can be achieved in many cases by controlling the production
process in production itself and by reducing the manual posting effort required:
shortening the lead times and reducing the stock

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Open Question

How is replenishment initiated in the Kanban procedure?

Unit 4

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Open Question

How is replenishment initiated in the Kanban procedure?

Unit 4

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In the Kanban procedure, replenishment is initiated when the demand source sets the
container in the system to empty.

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Name the basic master data of Kanban.

Open Question

Unit 4

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Name the basic master data of Kanban.

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Supply areas, Control cycles

Open Question

Unit 4

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Open Question

When is the goods issue typically posted in Kanban?

Unit 4

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Open Question

When is the goods issue typically posted in Kanban?

Unit 4

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In Kanban, goods issues are typically backflushed when an order is confirmed (or when a
goods issue is posted manually for an order). Emptying a Kanban does not result in a
goods issue posting.

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Open Question

When is the goods receipt typically posted in Kanban?

Unit 4

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Open Question

When is the goods receipt typically posted in Kanban?

Unit 4

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If the demand source sets the status to Full, the system automatically posts the goods
receipt for the material with reference to the procurement element.