Kanban is a means of supporting pull-based replenishment in manufacturing systems. A Kanban system is a self-regulating pull system that leads to shorter lead times and reduced inventory. Kanban systems are typically applied to items that have relatively constant demand and medium-to-high production volume.
Kanbans represent replenishment signals that are usually manual and highly visible, such as a color-coded card that moves with the material, a light that goes on when replenishment is required, or an empty bin that is moved to the supply location to trigger replenishment.
The system includes an API that can be called by external systems, such as bar code readers, to trigger replenishment signals.
Kanbans can be replenished from an external supplier or an internal organization. The four types of kanbans available in the system trigger transactions that pull material from different replenishment sources.
| Inter Org | Creates internal requisitions |
| Intra Org | Triggers material movement from a subinventory in the same organization |
| Production | Creates or releases a production job (discrete job, repetitive schedule, or flow schedule) |
| Supplier | Creates a purchase requisition |
Kanbans are generally replenishable and cycle through the system from full to empty, remaining active until they are withdrawn. One-time signals, called non-replenishable kanbans, are used primarily to manage sudden spikes in demand.
A pull sequence is a group of information that defines a kanban location, source information, and planning parameters for an item. In order to replenish an item using kanbans, you must define a pull sequence for each item. An item can have multiple pull sequences that make up a replenishment chain. Pull sequences are used to calculate the number or quantity in each kanban container at that location. A kanban location can be a subinventory or an inventory locator. The replenishment source for a kanban location can be another kanban location, a production line, or an external source (either another organization or an outside supplier).
You can define kanban pull sequences using inventory locators to represent kanban locations, compute kanban quantities by locator, and then track by subinventory in order to reduce the number of inventory transactions. See: Defining Kanban Pull Sequences
| Planning Only | Choose Planning Only if you want the program to perform the kanban calculations for you, but you will use a manual system to execute the kanbans. You will be able to calculate kanban sizes but will not be able to generate and print kanban cards or execute the replenishment cycle. |
| Kanban Size and Number of Kanban Cards | You will choose what you want the program to calculate: kanban size or kanban cards. The product of kanban size and number of kanban cards (or containers) will satisfy the demand at capacity for the planning horizon. Kanban size refers to the number of items in each kanban container. Each kanban container has one kanban card, so the number of kanban cards is the same as the number of kanbans for each item. |
| Enter Minimum Order Quantity (Optional) | Minimum Order Quantity represents the minimum number of units per kanban container. It is used when calculating kanban size or during the kanban execution process to aggregate kanbans smaller than the minimum order quantity. This field defaults from the Item Master window but can also be overridden. |
| Replenishment Lead Time | The Replenishment Lead Time must be expressed in days. This is how long it will take to physically replenish the kanban. For example, if you enter two days, the Kanban Planner will size the kanban to two times the average daily demand. If you leave the field blank, the program will assume replenishment is one day when calculating kanban sizes. |
Additional Information: Production kanbans use the replenishment lead time to calculate the size of the kanban but use the Lead Times on the Item Master window to determine when to schedule jobs created by replenishing the production kanban. This allows you to add lead time on the pull sequence of the production item for transportation, or desired "queue time."
Supplier and inter-org kanbans use the replenishment lead time to calculate the size of the kanban and to schedule the "need date" for the purchase requisition. However, if you leave this field blank, the program will use one day to size the kanban and will use the lead time defined in the Item Master window for the "need date" on the requisition. (Need date = sysdate + pre-processing + processing + post processing time if the replenishment lead time on the pull sequence is left blank.)
| Allocation Percent (Optional) | The allocation percent represents the percent of independent demand for the kanban item that is to be supplied from this pull sequence. |
| Lot Multiplier (Optional) | When kanban planning sizes the containers at the location, it will size in multiples of this quantity. For example, if the supplier sells wire in a roll of 500 feet, then a multiplier of 500 would result in bin sizes of multiples of 500 feet. If demand called for 510 feet, the kanban planner would size the kanban for 1000 feet (500 + 500). |
| Safety Stock Days (Optional) | Safety Stock Days is the number of days demand that will be added to the kanban for safety stock. Kanban planning sizes kanbans to the average daily demand of the forecasted period. |
For every kanban planned item, you can define a kanban chain, which is a series of pull sequences that model the replenishment network on the shop floor, for example, line stock to stores and stores to supplier.
Kanban cards are created for an item, subinventory, and locator (optional). They are uniquely identified by a kanban number. For cards generated from a kanban pull sequence, the number is automatically generated. For manually defined cards, both replenishable and non-replenishable, you can enter an unused kanban number or let the system create the number. See: Generating Kanban Cards and Defining Kanban Cards.
You can use the Generate Kanban Cards window to generate cards automatically from the following pull sequence information: item, kanban location, quantity, and source. You can also create these cards manually in the Kanban Cards window.
You cannot override the quantity for generated cards, but you can add additional cards or delete existing cards from the pull sequence to control the inventory in the replenishment chain. Function security is provided for this feature.
A supply source is defaulted from the source type of the pull sequence.
You can manually define non-replenishable cards by entering the item, location, supply source, and quantity in the Kanban Cards window. Non-replenishable cards do not have to be associated with a pull sequence.
You can create kanban cards with the following source types:
| Inter Org | Replenished by another organization |
| Intra Org | Replenished from another subinventory in the same organization |
| Production | Replenished by a production line |
| Supplier | Replenished by an external supplier |
Kanban cards are generated with a default Card Status of Active. When you define a card manually, you can initially give it either Active or Hold status.
If the Supply Status is Full, you can temporarily pull a card out of the replenishment chain by changing the Card Status to Hold. You can later change the status back to Active.
You can terminate use of a card by changing the Card Status to Canceled, but you cannot reverse this change. Only Canceled cards can be deleted.
All the following Supply Status codes can be set either manually or automatically.
| New | The kanban has just been created and is not yet part of the replenishment chain. |
| Empty | The kanban is empty and a replenishment signal has been generated (available only for Inter Org and Supplier source types). |
| Full | The kanban has been replenished. |
| Wait | The kanban is waiting until the minimum order quantity has been met by the aggregation of cards. |
| In-Process | For the Supplier source type, the purchase order has been approved. For the Inter Org source type, the internal requisition has been approved. |
All cards are generated with a status of New. You can switch this status to Empty to trigger a kanban replenishment signal. During initial setup, you can switch the status to Full if you are starting out with a full bin. When you are defining a card manually, you can create a card with a status of Empty, Full, or New.
You can print Kanban cards for a replenishment plan or a replenishment chain when you generate the cards. You can also print cards individually if the card information is complete.
You can print duplicate cards only if the original is lost or voided. You are given a warning message before you can print duplicates.