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Guide to the benefits of Electronic Kanban vs Traditional Kanban - Part one

The effect of Kanban on the manufacturing industry has been quite substantial – Highlighted by Ohno, Taiichi in Toyota Production System: Beyond Large-Scale Production, the Pull system that Kanban introduced has helped minimize inventory while maintaining a steady beat of production in countless companies. Electronic Kanban aims to enhance the notion of “Just in Time” supply and exploit it further through use of technology

Electronic Kanban's typically include:

* Use of Barcode or simular labels and readers
* Workflow or routing software providing triggers to replenish stock at point of use
* Messaging software to update suppliers as to requirements
* Alert systems to provide information on key issues e.g. stock outs.
* Management Information modules to facilitate improved material planning

Traditional Kanban has been effective largely due to the fact that it is effective and fairly simple to introduce and maintain. A Kanban card (containing information about a part) accompanies a product, and is used as a replenishment signal. The flow of materials is then controlled by these “pull” signals as to what is required, inventory is minimized and aligned with production.

Kanban has been proven many times over and has been widely adopted across a variety of industrial and manufacturing sectors – it has become a central element in lean practice.

Problems with traditional Kanban

While Traditional Kanban has been successful, it is also not without issues. These can vary from lost Kanban Cards, administrative burden where the inventory range is large (and thus there are large numbers of cards to manage) and the physical requirement of Kanban card collection. The system can also be unwieldy when there are variations in the demand profile and it can be slow to react to changes.

There are also physical limitations – Traditional Kanban works best within the confines of the manufacturing plant but has some serious challenges if you try to expand it, and the Kanban card, to suppliers

In part two of the article we look at the benefits of Electronic Kanban


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