Kanban

Kanban is a scheduling system for lean manufacturing (also called

just-in-time manufacturing, Taiichi Ohno, an industrial engineer at
Toyota, developed kanban to improve manufacturing efficiency. The
system takes its name from the cards that track production within a
factory. Kanban is also known as the Toyota nameplate system in the
automotive industry.
A goal of the kanban system is to limit the buildup of excess
inventory at any point in production. Limits on the number of items
waiting at supply points are established and then reduced as
inefficiencies are identified and removed. Whenever a limit is
exceeded, this points to an inefficiency that should be addressed.
The system originates from the simplest visual stock replenishment
signaling system, an empty box. This was first developed in the UK
factories producing Spitfires during the Second World War, and was
known as the “two bin system.” In the late 1940s, Toyota started
studying supermarkets with the idea of applying shelf-stocking
techniques to the factory floor. In a supermarket, customers generally
retrieve what they need at the required time—no more, no less.
Furthermore, the supermarket stocks only what it expects to sell in a
given time, and customers take only what they need, because future
supply is assured. This observation led Toyota to view a process as
being a customer of one or more preceding processes and to view the
preceding processes as a kind of store.

Kanban aligns inventory levels with actual consumption. A signal

tells a supplier to produce and deliver a new shipment when a
material is consumed. This signal is tracked through the
replenishment cycle, bringing visibility to the supplier, consumer, and
buyer.
Kanban uses the rate of demand to control the rate of production,
passing demand from the end customer up through the chain of
customer-store processes. In 1953, Toyota applied this logic in their
main plant machine shop.
Advantages:
1-Kanban is a very simple and easy to understand system that makes
it practical for the management of a company to apply this system
effectively.
2-The main advantage of applying the kanban system is a direct
reduction in the costs and wastage of the company.
3-Kanban system advocates continuous and sustainable improvements
in the production systems of the company.
Disadvantages
1-Kanban cannot be used as an independent tool.
2-As the tasks are continuously shifted between the columns of
kanban board, the prediction of specific timelines for completion of
tasks or activities becomes difficult. This is because kanban acts only
as a signaling port in a pull production system.
3-Kanban is not suitable for the environments that are dynamic in
nature.