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

Benefits of Electronic Kanban

With the aide of technology, Electronic Kanban typically replaces the manual Kanban card with a barcode attached to the product or bin which can be scanned at various stages of the manufacturing process (typically on consumption of the product). Kanban systems then use this “consumption information” to request replenishment from stores and where required automatically place orders on suppliers. The barcode and messaging negates the need for someone to collect cards whilst providing a clear record of where and when inventory is consumed/required.

While traditional Kanban’s struggle with large inventory ranges, this doesn’t pose a problem for electronic Kanban (there is no physical card to manage and triggers are managed by the system). Another byproduct of the system is that there is improved analysis which allows materials managers to monitor trends and allow the system to manage Kanban sizes.

There are various implementations of Electronic Kanban and it can take the form of a single system (from specialized software vendors) or modules which can be “bolted on” to an existing ERP such as SAP.

Many such systems link to suppliers (typically via the internet) – sharing the inventory situation in real time – allowing businesses to gain an insight into it’s supply chain’s inventory levels. When facets such as workflow and alerts are included – Electronic Kanban provides an important tool not just for the manufacturer but for it’s supplier base also who gain visibility of inventory, stock outs etc.

Electronic Kanban systems also typically interface with production planning and scheduling systems allowing the size of the lots or Kanbans to be "tuned" in realtime and therefore allowing for more flexability within the system.

example electronic kanban process

Problems with Electronic Kanban

Electronic Kanban is not for everyone – they can be both complex and costly to deploy (especially where links with external suppliers need to be configured) and businesses should look carefully at the business case before proceeding.

It is a proven tool, however and is typically utilized by largescale organizations who use Electronic Kanban to link suppliers, stores, production into a single pull system.


Traditional Kanban has been around for many years and has changed the face of inventory management – Electronic Kanban aims to enhance this toolkit through utilizing technology – overcoming some of the obstacles of the traditional system whilst enabling collaboration with the supply chain beyond the confines of the typical organization.


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