Kanban: Are You Ready?
March 1, 2004
I recently had an executive at a
large organization tell me “We are going to implement a Kanban
system first, and then we will think about a Lean implementation.”
This seems to be common in companies today as they pick and choose
the tools of Lean but do not look at them from a systems standpoint.
Lean tools like 5S, SMED, Kanban, TPM etc., are very powerful but
are so often misused due to improper thought process. Many companies
look to Toyota and the success they have had with a Kanban
implementation and think it is the answer to all their problems, but
what they fail to realize is to be successful they must have stable
production processes. Organizations should look at the success
Toyota has had through development of the Toyota Production System
(TPS), but they need to keep in mind that it has taken them 50
years. Let’s look at Toyota.
At the 2003 Automotive Parts System Solution Fair,
held in Tokyo, June18, 2003, Teruyuki Minoura, then-managing
director of global purchasing, Toyota Motor Corporation, talked
about his experiences with TPS (the Toyota Production System), and
what it means for suppliers and for the future of the
In simplest
terms, just-in-time is “all about producing only what’s needed and
transferring only what’s needed,” says Minoura. Instead of the old
top-down “push” system, it represented a change to a “pull” system
where workers go and fetch only what is required. Tools, including
the kanban (information card), andon (display board), and poka yoke
(error prevention) were developed to implement the pull system. But,
Minoura warns “simply introducing kanban cards or andon boards
doesn’t mean you’ve implemented the Toyota Production System, for
they remain nothing more than mere tools. The new information
technologies are no exception, and they should also be applied and
implemented as tools.”
There are
several barriers in production processes that companies should look
at as they begin a Kanban implementation.
Short die
changeover and machine set-up time are critical to respond quickly
to a production signal. If die changeover and machine set-up time is
long, it makes the system less responsive. Toyota’s officials
believe that short die changeover and machine set-up times have been
responsible to a large extent, for the success of kanban
implementation at Toyota. The reduction in die changeover and
machine set-up times also reduces the production lot size. Short die
changeover and machine set-up time offers the necessary flexibility
for a pull system. A study conducted on the US automotive industry
in 1997, reported that the die changeover time for Chrysler, Ford,
and GM was nine times more than that of Toyota. Changeover cost
being proportional to changeover time, the recommended economic lot
size is three times that of Toyota. Additional finished goods
inventory is required for a pull system to operate with long die
changeover times to offset the effect of slow response time and
reduced resource availability. Therefore, Toyota has an edge over
the rest to implement the pull system.
Another
roadblock to implementing a pull system is varying production
schedules. Since a pull system causes production to start only when
there is a demand for the product, a large variation in demand will
cause production levels to change. A study at Toyota’s assembly
plant showed that a hybrid system outperformed a pure pull system,
in the case of variable demand.
The third
obstacle to pull system implementation is production variability.
Production variability is a result of problems in the production
process. Two common reasons for stalling of production are equipment
downtime and quality stops or rework. The reliability of the
production process is very important to respond quickly to a
production signal.
The fourth
obstacle, large batch size, needs to be reduced to implement a pull
system. Large batch sizes do not provide the production flexibility
required for an effective pull system.
The fifth
obstacle is a critical bottleneck in the production process.
Applying the Theory of Constraints approach, the bottleneck is
scheduled first, and the rest of the processes are forced to meet
this schedule. This system is superior to a pure pull system.
The sixth
and the last obstacle is long lead times. Long lead times prevent
the produced parts from reaching their destination in time. For
example, a pull system may not work when there are vast geographical
distances separating assembly plants and suppliers. An analysis of
Toyota’s Motomachi plant reveals that almost all its suppliers are
within 30 kilometers of the plant. This physical proximity with
suppliers reduces lead times.
Efforts to
implement a pull system before making the necessary process
improvements will fail to bring about the desired benefits. The
implementation of kanban is not the only reason for Toyota’s
success. The process improvements, prerequisites for the
implementation of kanban, have resulted in Toyota’s world-class
production system.
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About the Author
David McBride is co-founder of EMS Consulting Group, a Carlsbad, CA based engineering and management consulting firm. David has a BS in Mechanical Engineering from Ohio State University. He has a successful track record in the development and implementation of FMEA and Design for Manufacturability programs at several organizations and has greatly reduced Manufacturing costs through the utilization of Lean Manufacturing, Kaizen Events, and Manufacturing System Analysis. He has also been highly successful at developing and executing New Product Introduction processes, and Staffing and Capital Equipment Plans.
EMS Consulting Group helps companies implement lean strategies through lean training and lean consulting services. To learn more, read our lean manufacturing case studies or lean manufacturing articles.