KANBAN Process for External Procurement

What is KANBAN:
Kanban is a Japanese word with the meaning Signboard or Billboard and basically a card contain the
details like the required material and its quantity and where the material is required. Normally during
the production, if there exists a system of scheduling which takes care of immediate requirements of
the Production for the delivery as and when required say Just In Time rather when needed , would
reduce the Lead Times and Inventory and provides a continuous flow for Production which does not
stop the lines of Production..
The process with this name KANBAN has been designed to take care of such requirements which
will schedule the logistics chain as and when required for the Production Line. In this process the
requirement for replenishment will be triggered by Production. This triggering will be in the form of a
Signal (KANBAN SIGNAL ) in the place of kanban card manually which will consists of Required
material and Quantity and the work area where it is required and will be sent directly to the work area
( Source vendor / Production area where its manufactured ) . Soon after the material is received the
Goods Receipt can be posted automatically through the signal at the source of Demand.
KANBAN a Simplified Version:
Worthy points for KANBAN
The components which have to be consumed should be constant for a period of time which should be the
longer than the replenishment lead time of the component.
The supply source should be capable of producing large quantities in small lots with in a period.
Few key words to be noted worthy.
Control Cycle: A control Cycle defines the relationship ouibetween the demand source such as a production
line and the supply source such as an External Source.
Work area: Is an area at which the demand for the material exists and at which this material is utilized for the
production of another component
JIT CALL: Is a Just In time call is a signal which will be generated in the system and which will contain the
details like the material, required quantity, Delivery date, and the material Required Plant and the supply area
which will receive the material and supply to the demand area of production, to whom the details to be send
which is the vendor based upon the scheduling agreement.
Scheduling Agreement: Scheduling Agreement is an Agreement with the vendor for a supply of the required
material for a JIT CALL quantity with the schedule of delivery.
Kanban Quantity: It is the quantity allotted for a KANBAN upon which needed to get filled with when emptied.
KANBAN Procedures:
There exist different procedures available for KANBAN based upon the control of Production and Operational
structures.
Classic KANBAN: This procedure will be used to replenish the material for the number of Kanbans that
circulates between the supply source and the demand source and the quantity per kanban.In this type of
kanban the number of kanbans are fixed as per the control cycle and the quantity in the control cycle and also
the signal will get triggered for the quantity per kanban defined in the control cycle.
Event Driven KANBAN: In the Event Driven kanban, the material is not made available continuously at a
production supply area, but is procured when the material is requested. This does not depend upon the
number of kanbans in the control cycle or the quantity in the kanban of the control cycle.
One Card KANBAN: With this approach, replenishment is always triggered when the kanban from which
material is currently being withdrawn is approximately half empty. The new kanban then arrives before the
current kanban has been completely emptied. This is very much useful when the material is not needed from
time to time.
KANBAN with Quantity Signal: In the Classic KANBAN, the signal will be made to Empty when the operator
makes it to empty when the KANBAN quantity reaches to ZERO and will not be knowing the current level of
quantity prior becoming to zero. In contrast to Classic variety , in this model the operates c n enter the quantity
and system can make the signal to Empty when emptied automatically as soon the kanban quantity is
reached .