1. Why Kanban Systems Fail and What You Can Do About it
Saifallah Benjaafar
Center for Manufacturing Logistics
Department of Mechanical Engineering
University of Minnesota
Minneapolis, MN 55455

2. Kanban
A “kanban” is a sign-board or card in Japanese and is the name of the flow control system developed by Toyota.

3. Outline 1. The JIT context 2. Basic mechanics 3. Advantages
4. Limitations
5. Alternatives to Kanban
6. CONWIP systems
7. PFB systems
8. MTO/MYS systems
9. Conclusions

4. Role
Kanban is a tool for realizing just-in-time. For this tool to work fairly well, the production process must be managed to flow as much as possible. This is really the basic condition. Other important conditions are leveling production as much as possible and always working in accordance with standard work methods.
--- Ohno 1988

5. Just-in -Time (JIT)
A collection of principles aimed at reducing inventory, increasing throughput, and minimizing manufacturing lead times.

6. Origins of JIT
Japan’s attempt to become competitive with US and European manufacturers after WW II
The Toyota Production System

7. JIT principles Reduce setup times reduce batch sizes
Reduce variability
Reduce material handling
Reduce defects and rework
Reduce breakdowns
Increase capacity
Smooth production schedules

8. JIT principles (cont.) Maintain constant WIP (limit WIP buffer sizes)
Limit finished goods inventory and raw materials
Synchronize operations within the factory
Synchronize material delivery with suppliers and customers
Improve worker flexibility and empower worker to make improvements
Simplify workflow

9. The Seven Zeros Zero (excess) lot sizes Zero setups Zero breakdowns
Zero lead times
Zero surging
Zero material handling
Zero defects

10. Kanban Systems
A shop floor control strategy aimed at (1) reducing inventory, (2) simplifying workflow, (3) increasing throughput, (4) reducing cycle time, (5) improving customer lead times, and (5) improving quality.

11. Mechanics of Kanban Push vs. Pull: Kanban is a “pull system”
Push systems schedule releases
Pull systems authorize releases
Synchronous manufacturing: Pull signals ensure tight coupling between operations throughout the system

12. Mechanics of Kanban (cont.)
One card systems
Two card systems

13. Mechanics of Kanban (cont.)
Work Center
Buffer
Card Flow

14. One-Card Kanban Outbound stockpoint Production cards
Completed parts with cards enter outbound stockpoint.
When stock is removed, place production card in hold box.
Production card authorizes start of work.

15. Two-Card Kanban Outbound stockpoint Inbound stockpoint
Production cards
Move stock to inbound stock point.
When stock is removed, place production card in hold box.
Production card authorizes start of work.
Move card authorizes pickup of parts.
Remove move card and place in hold box.
Move cards

16. MRP versus Kanban MRP … Kanban … … Kanban Signals Full Containers
Lover Level Inven-tory …
Assem-bly
Kanban
Lover Level Inven-tory …
Assem-bly …
Kanban Signals
Full Containers

17. Signaling
Cards
Lights & sounds
Electronic messages
Automation

18. The Key Issue
How many Kanbans should we have at each stage of the process and for each product?

19. Tradeoffs
Too many Kanbans Too much WIP and long cycle times
Too few Kanbans Lower throughput and vulnerability to demand and process variability

20. Little’s Law Cycle time = WIP/Throughput
WIP = (Cycle time)(Throughput)

21. Example Four identical tools in series. Each takes 2 hours per piece.
No variability.
Constant WIP.

22. The Penny Fab

23. Throughput and Cycle Time vs. WIP
Throughput (Jobs/hr) .2 .4 .3 .5 .1
WIP (Jobs)

24. Throughput and Cycle Time vs. WIP (cont.)20 16
Cycle time (Hours) 12 8 4
WIP (Jobs)

25. The Case of an Unbalanced Line
The maximum feasible throughput rate is the processing rate of the bottleneck
Critical WIP = (Bottleneck rate)(Total processing time)

26. The Impact of Variability
Processing times are subject to variability, material handling is not instantaneous, processes are subject to breakdowns, demand is subject to fluctuation
Longer cycle times and lower throughput

27. Number of Kanbans at Toyota
Number of cards = WIP
Number of cards = D/QL(1 + a)
D: Demand
Q: Container
L: Raw processing time
a: safety (variability) factor

28. Guidelines for allocating Kanbans
Allocate Kanbans evenly in a balanced system
Allocate more Kanbans to slower processes or processes with higher workloads
Always protect the bottleneck

29. Guidelines for allocating Kanbans (cont.)
Start with current averages
Gradually reduce Kanbans at stations that are always full
Increase Kanbans at stations that are always empty

30. Advantages of Kanban Simplifies workflow Synchronizes manufacturing
Reduces WIP accumulation at all processes stages
Improves performance predictability and consistency
Fosters communication between neighboring processes
Reduces defects and enables 100% inspection

31. Advantages of Kanban (cont.)
Encourages line balancing and process variability reduction
Encourages focused and cellular manufacturing
Y2K robust

32. Limitations of Kanban Systems
Ideal for high volume and low variety manufacturing
Vulnerable to fluctuations in demand volume and product mix
Vulnerable to process variability and machine breakdowns
Inefficient in handling infrequent orders or expediting special orders
Vulnerability to raw material shortages and variability in supplier lead times

33. Alternatives to Kanban
Constant Work-in-Process (CONWIP)
Pull from the Bottleneck (PFB)
Hybrid Make-to-stock/Make-to-order system

34. CONWIP
CONWIP Cards
Production Line
Inbound
Stock
Outbound
Stock

35. Basic Configurations Constant work-in-process Input/output control
Asynchronous operation
Dispatching list
Example: Flow lines

36. CONWIP Control . . . LAN PC Work Centers Dispatching list DD PN Quant
–— –— –––––
Dispatching list
LAN
. . .
Work Centers

37. CONWIP Configurations
Basic CONWIP
Multi-Loop CONWIP
Kanban
Work Center
Buffer
Card Flow

38. CONWIP Mechanics A new job is introduced whenever one completes
The next job is selected from a dispatching list based on current demand
The mix of jobs is not fixed
Priorities can be assigned to jobs in the dispatching list
WIP level can be dynamically reduced

39. Advantages of CONWIP-based Control
Accommodates multiple products and low production volumes
Allows expediting and infrequent orders
Less vulnerable to demand and process variability
Less vulnerable to breakdowns
Protects throughput and prevents bottleneck starvation
Simpler to implement and manage

40. Coupled and Uncoupled CONWIP Loops
Bottleneck
CONWIP Loop
Buffer
Job
CONWIP Card
Material Flow
Card Flow

41. Splitting Loops at Shared Resource
Routing A
Routing A
Routing B
Routing B
CONWIP Loop
Card Flow
Material Flow
Buffer

42. Modifications of Basic CONWIP
Multiple Product Families:
Capacity-adjusted WIP
CONWIP Controller
Running a card deficit
Assembly Systems:
CONWIP achieves synchronization naturally
WIP levels must be sensitive to “length” of fabrication lines

43. Card Deficits Jobs without Cards Jobs with Cards B Bottleneck Process
Failed Machine

44. CONWIP Assembly Processing Times for Line A 2 1 4 1 Processing Times
for Line B 3 3 2 3
Assembly
Buffer
Card Flow
Material Flow

45. Pull From the Bottleneck
Problems with CONWIP/Kanban:
Bottleneck starvation due to downstream failures
Premature releases due to CONWIP requirements
PFB Remedies:
PFB ignores WIP downstream of bottleneck
PFB launches orders when bottleneck can accommodate them
PFB Problem:
Floating bottlenecks

46. Simple Pull From the Bottleneck
Material Flow
Card Flow

47. Make-to-order/Make-to-stock Configurations
Build components and subassemblies to stock
Build final assemblies to order
Pull system for MTS
Push System for MTO

48. Conclusion There are Pros and Cons to everything
Pull systems are one piece of the puzzle
Change throughout the organization is essential
An integrated supply chain strategy is critical

49. References and Additional Reading
Factory Physics, W. J. Hopp and M. Spearman, Irwin, 1996 (and teaching notes)
The Race, E. M. Goldratt and R. E. Fox, North-River Press, 1986
QRM Revisited: Don't Push or Pull - POLCA, APICS Magazine, Vol. 8, No. 11, 1998.

50. Additional Resources at U of M
Industrial Engineering Graduate Program
Master of Science in Manufacturing Systems
Graduate Student Internships
Center for Manufacturing Logistics