How to use Kanban for an effective production system

The word “Kanban” refers to the labels that are placed in parts and products to identify them during the different manufacturing and transportation processes in companies. However, the Kanban philosophy covers a much broader set of ideas that we’ll discuss in the following paragraphs.

The Kanban methodology is related to the creation of a production system which is more effective and efficient, focusing mainly in the fields of production and logistics.

What is Kanban?

Kanban systems consist of a set of ways to communicate and exchange information between different operators of a production line, a company, or between suppliers and customers. Its purpose is to simplify communication, making it more agile and therefore helping avoid errors caused by a lack of information.

The most common example of Kanban are the labels that are placed onto products as they are manufactured, so that their future destination or features can be correctly identified.

Kanban can also refer to work orders, ie, including information about the operations that must be done with each product and in what quantity, by what means and how to transport it.

Currently, most companies have automated their Kanban methods, so that, for example, labels can be placed with barcodes or QR codes so that, by scanning the products at each control point, the system automatically locates them and displays the necessary orders to get each item to its final destination.

Types of Kanban

The following are some of the ways to implement a Kanban system:

  • Transport labels containing information about the contents of each package and its destination.
  • Manufacturing labels with information on the characteristics of the product to be manufactured.
  • Labels with any other relevant information to conduct activities.

These tags can be traditional (handwritten or typed), or include the information in numeric codes, or in the form of a barcode or QR code to be read by a special scanner connected to a computer.

Advantages of using Kanban systems

These are some of the advantages of Kanban in production processes:

  1. They increase the flexibility of production and transportation processes.
  1. If a computerized system is used, it allows companies to know the status of all items at all times, and give instructions based on the current conditions of each work area.
  1. It prevents unnecessary work as well as an excessive, also unnecessary paperwork.

These are some of the advantages of Kanban in logistics operations:

  1. Better control of the stock.
  1. It allows the prioritization of production: the type of product with the most importance or urgency goes before the others.
  1. Material control is provided.
PPG Manufacturing_david kiger_logistics_production system_Kanban
Image courtesy of TheLeadSA at

How to implement a Kanban system

This system is implemented through the following four phases:

Phase 1: Design the Kanban system that will be used from now on and train staff on the principles of Kanban and its benefits.

Phase 2: Implement Kanban in the production lines and activities with the most action, where more problems may arise or where it is most important to avoid failures and delays. The training with staff should continue in the production line.

Phase 3: Implement it in other activities. The views of workers should take into account since they are the ones who know the system.

Phase 4: In the last phase a review of the Kanban system should be performed, in order to improve it, based on previous experience.

The Kanban tool is based on rules and tips that must be met to implement it correctly:

  • The first rule is that you should not send defective products to subsequent processes. The production of defective items involves investment costs such as materials, equipment and manpower that cannot be sold.
  • The second rule is that subsequent processes will require only what is necessary. This means that the subsequent process will ask for the required materials to the previous process, in the right amounts and at the right times.
  • The third tells us that we must produce only the amount of product required by the next process, so production must be restricted as required and manufacturing should be done as the orders arrive.
  • The fourth rule says that you have to optimize production so that we can only produce the necessary amount required by subsequent processes. It is necessary for all processes to keep the team and workers so that they can produce the required amount of materials when needed.
  • The fifth rule is oriented towards avoiding speculation: it’s not worth it to speculate on whether the subsequent process will need more materials the next time. Nor can the subsequent process ask the previous process if the next batch could start a little earlier. It is very important for production to be well balanced.
  • The sixth and final rule serves to stabilize and streamline processes. Faulty work exists if the jobs are not standardized and streamlined. If this is not taken into account, defective parts will continue to exist.

So let us summarize the reasons why it’s interesting to use Kanban: It makes it possible to increase the efficiency of processes, avoid delays and not squander resources, a reduction of inventory levels (stock) is achieved, there’s less downtime in processes, better cleaning and maintenance, faster and accurate information, a minimization of non-conforming products and waste, and an avoidance of overproduction.

Related content

Read David Kiger’s “Get Kaizened: making ‘tomorrow’ better than ‘yesterday’”


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