History of the Kanban System

Two-Bin System
The two-bin system develops from the simplest visual stock resupply signalling system, which is an empty box. This was initially developed in
the factories of the UK factories. The factories were making Spitfires at the time of the Second World War, and this system was called the “two-
bin system.”
Supermarket store
Late In the 1940s decade, Toyota began analyzing supermarkets with the notion of utilizing shelf-stocking methodologies to the factory floor. In
a supermarket, buyers normally gets what they require at the given time which is no more extra, and nothing less that what is desired.
Additionally, the supermarket holds the inventory only what it thinks to sell in an available time frame, and customers consume only what they
require, because supply in the future for those commodities are ensured by the supermarkets. This thinking led Toyota to analyze a subsequent
process as being a customer of the earlier processes and to evaluate the preceding processes as a type of supermarket store.
Rate of Demand is the Driver.
Kanban utilizes the demand rate to regulate the production rate, leading demand in the supply chain from the end consumer and signalling it up
through the links of customer-store notion. In 1953, Toyota firstly implemented this idea in their major and biggest plant machine shop.
Context of the Kanban System
The context of the Kanban System is traced out with the will for improvement in optimizing capacity against the demand.

Improvement is about Exploiting Opportunities

The true accomplishment of improvement is all about utilizing the most of opportunities as it unfolds. It’s around capturing, exploiting, and
taking advantage of opportunities to organizational development and overall good, this is apart from the mentality of going with the status quo.
Management has a major stake to play in this endeavour and for any Kanban implementation project as well. By offering a suitable combination
of organization, culture, and architecture, one can minimize resistance and friction against initiatives. This is what is known by Leading
improvement through long-term thinking.
The Context
Kanban was initially a tool utilized by Toyota to synchronize demand and capacity throughout the value chain. The idea is quite and incredibly
simple: a Kanban card is forwarded in supply stream when there is a requirement for new parts at the consumer end. It is merely then that
manufacturing for the required number of items is done. The appearance of a new card in the upstream is a call to action to make required parts,
and the absence of cards is a sign to stop any further manufacturing or processing. The number of cards is arranged in a way to avoid
overproduction, high inventory and to minimize the parts required in production. It actually saves a lot of amount for the overproduced in-
process material and inventory required to hold it. The saved amount can be used elsewhere for business excellence.
Recipe for the Success of Kanban Project and Improvement
Some people think Kanban is a visual board and let's place the visual board and forget everything else as if the board will itself work on its own.
It is the biggest mistake in a Kanban implementation project. The Kanban project is not implemented by just placing board. If one expects the
board will yield improvements, without other necessary elements of the Kanban's project, the project is deemed to fail. It is where the need of
managers, engineers, and supervisors to get involved with the Kanban process is required. It is true that Kanban can help us to see and examine
the underlying problems to solve. But the recipe for improvement is doing something concrete about the problems. The concrete step against the
problems makes the real difference. A simple recipe for the success of followed a straightforward recipe for improvement:

 Unleash the power of the initiative and let every team member know it.
 Those who are doing the work should be empowered with the process ownership and responsibility of quality work.
 The management should emphasize on improving the value chain, throughout and from start to end, not just emphasizing one chain in the
stream.
 Build a culture of experimentation, whenever a new idea comes up, the majority is willing to experiment it on a pilot basis.

Just-in-Time (JIT) Production System

in the post-World War II scenario in Japan, Japanese companies and manufacturers struggle with numerous challenges, which were a shortage of
financial resources, shortage of space (because of nuclear radiations affected zones so they faced a challenge in building large warehouses) and
of-course the depleted natural resources. Due to these serious issues and constraints, Japanese manufacturers were facing an inertial situation,
from which they need to liberate themselves so as to pave way for their industrial success. Of course due to this situation, Toyota revolutionized
itself with a simple but effective solution which was to have their processes lean.
Thus resources were utilized through lean management, and it was structured upon the basic principle of Just-in-time. An idea founded on taking
off waste from the organization's processes to attain a smooth extremely efficient and robust system that offers products at a very low cost but
maintaining the same high-quality to cater the customer requirements. needs and expectations. It took several years for Toyota to streamline the
Just-in-time production management, which is now known globally in various industries and adopted by many successful businesses, for
example, McDonald’s, Dell, and Harley-Davidson.
We can relate to Just-in-time manufacturing or processing as a philosophy rather than some serious or strict guidelines. However, when properly
implemented, JIT assists organizations to empower their advantage and competitiveness in the market. Just-in-time empower organizations to do
the following:

 Minimize waste (according to lean concept) and eradicate activities that don’t offer value.
 Enhance the quality of organization's products and processes.
 Enhance productivity levels and minimize expenses.

Push Versus Pull Production System

The primary emphasis of JIT is to pull production through the organization's process chain as the consumer only consumes what they need.
According to lean, the ideal process flow should a single piece produced when required; however, this is not all-times probable with numerous
existing processes apart from major facility redesign which needs a lot of investment. The facility designing for one-piece flow is very changed
to what most companies have conventionally made.
Push System
Conventionally, production processes are decided by the supply chain department or the planning department. For instance, the planning
department schedules it, procurement department orders the raw materials as per the planning schedule, and the production produces as per the
planning schedule. The planning is done based on market forecasting. The market forecasting depends on many things, and it is not appropriate
at times. The discussed process flow is known as the push production and is maneuverer significantly by the inputs being given into the start of
the production process and the planning or Material Resource Planning (MRP) controls the remaining processes. The traditional method usually
manufactures items in huge quantities or production batches and demands a huge amount of the company's capital in Work in Progress (WIP)
and the finished goods stock (FG).

Pull System
Pull production on the other hand functions in reverse, when a consumer consumes a product from the downstream of the organization's
production process, a Kanban signal is generated and then pushed down the line to initiate the production of the subsequent unit. This is like a
supermarket, who will fill the vacant shelf in the flow back to every preceding process and each process will signal the items that it requires from
each of the preceding process. This process is managed through the implementation of a Kanban system.
Bibliography
 Ohno, T., 1988. Toyota Production System: Beyond Large-scale Production. Productivity Press.
  Shingo, S., 1989. A Study of The Toyota Production System: From An Industrial Engineering Viewpoint (produce What Is Needed, When
It's Needed). Productivity Press.

Introduction to the Kanban System

Kanban is a Japanese term and it means a signboard or billboard in Japanese. It is a system of scheduling for lean production and manufacturing
based on just-in-time manufacturing. Taiichi Ohno, an industrial engineer at Toyota, built Kanban to enhance operational efficiency.
The Objective of the Kanban System
An objective of the Kanban system is to restrict the accumulation of unwanted inventory at any step in the process of production. Inventory
Limits on the number of items standing back at supply up-streams are developed and then minimized as inefficiencies are recognized and taken
off. Whenever a limit is surpassed, this relates to an inefficiency that should be taken care of.
Operation in a Kanban System
A key drive towards the achievement of conventional production scheduling based on demand, pushing, is the capability of the forecast to figure
out the right demand to go with a push onto the consumer market. Kanban, on the other hand, is part of an approach where the need to drive the
demand from consumer or in other words. Pull initiates from the demand and units are produced as per the order. Replenishment cycles or
manufacturing is resolved as per customer orders.
In examples, where supply time is extensive and demand is challenging to forecast, many times the best thing one can go with is to act quickly to
the demand as it is noticed. This reality is precisely what a Kanban system achieves, in that it is utilized as a demand signal that quickly goes
through the supply chain. It ascertains that Work-in-process (WIP) stock remained in the supply chain are better utilized, and are mostly in
smaller quantity as per the expected demand quantity. On the contrast in situations where the supply reaction is not smooth enough to comply
with the real demand variations, resulting in likely lost sales, an increase in stock building may be identified as needed and can also be managed
with the help of additional Kanban cards in the system until the process is compatible with the fluctuations of demand.
The Term Kanban
"看" the Japanese word is transliterated as “kan-” which means “to look”.
• "板" the Japanese word is transliterated as “-ban” which means “board.”

Therefore, the term Kanban literally means to look at the board and translated as “look at the signboard” or "look at the billboard". It also means
controlling the process needs with the help of a visual signalling display system.
In trading, software development and manufacturing companies, Kanban organizes all company's direction to focus on the demand of the
processes instead of pushing from the supply streams. However, Kanban requires to involve all the stakeholders in a supply-chain process and
integrate them with a common visual board or a common visual software. Kanban help companies to synchronize inventory levels with real
consumption based on demand. A signal informs a supplier to supply or manufacture and item and deliver a new material supply when a material
is utilized in the subsequent process. This signal is visible and traceable through the re-fulfilment cycle, providing visibility to the provider,
consumer, and eventually to the buyer as well.