Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

6.3.1 Kanban: A Technique of Execution and Control of Operations

Intended learning outcomes: Describe the Kanban card. Explain the Kanban feedback loop. Present in detail Kanban rules of order release and control of the feedback control system.


Kanban (Japanese for card, or visible record) is a reusable signal card that passes back and forth between two stations. It is thus a kind of traveling card.

Buffers are kept at the user operation. These stores will contain, for exam­p­le, a maximum number of standard containers or bins (A) holding a fixed number of items (k). The order batch size will be a set of containers (A). The Kanban card is a means to identify the contents of the container and to release the order. The card will look similar to the one in Figure 6.3.1.1.

Fig. 6.3.1.1        Example Kanban card. (Taken from: [Wild89]).

The term Kanban, meaning signboard, is formed from the characters for “to look at closely” and for “wooden board,” as shown in Figure 6.3.1.2. Kanban was the word used for decorated shop signs that came into use in merchant towns in the late 1600s in Japan.

Fig. 6.3.1.2        The word Kanban (explanation by Tschirky; see footnote).[note 613]

The Kanban technique is defined as a Kanban feedback loop and rules for Kanban use.

Figure 6.3.1.3 defines a Kanban feedback loop, between parts production and preassembly as well as a two-card Kanban system:

Fig. 6.3.1.3        Basic principle of the Kanban technique: the Kanban feedback loop.

  1. If in preassembly the contents of the container have been used up, an employee goes with the container and the use (or move) card to the buffer and takes a full container of the required items. He remo­ves the production card attached to the full container and places it in a mailbox. He attaches the move card from the empty con­tai­ner to the full container. The empty container remains in the buf­fer, while the full container with its move card goes to assembly.
  2. An employee in parts production routinely goes to the buffer and collects the production cards and empty containers. The Kanbans collected are the orders for manufacturing the corresponding num­ber of items (an order may also comprise several containers). The release of the order is registered by passing through a shop floor data collection device, such as a bar code scanner. There is no due date on the Kanban, for each order is to be filled immediately.
  3. Once the items have been manufactured, the production card is attached to the full container and the container is moved to the buffer. Again, passing through a shop floor data collection device serves to register entry of the order.

The buffer usually stands at the inbound stockpoint of the user, that is, a defined location next to the place of use on a production floor. The buffer only seldom stands at the outbound stockpoint of the manufacturer, that is, a defined location next to the place of manufacturing on a production floor.

As a variant, there may also be a one-card Kanban system, where the Kanban remains fixed to the container. Another variant transmits the Kanban of the empty container by fax or by an automatic scanner via tele­communica­tions. This avoids transport time for the return of the empty container in the case of spatially remote sites. Here, the essence of the traveling card is lost: As it becomes “copied” in each cycle, it does not remain the identical physical card. This creates the danger of duplicate orders.


Watch the animation demonstrating the basic principle of the kanban technique explained in Figure 5.3.1.3. In this exercise, five containers form one transport batch.


The Kanban rules or rules for Kanban use are defined in Figure 6.3.1.4 as a process strategy.

Fig. 6.3.1.4        Kanban rules of order release and control of the feedback control system.

The Kanban rules ensure, in their pure application, that no reserves will form and that orders are processed immediately. The order is registered imme­diate­ly as an event, and it sets off the production process.[note 614] This means, however, that adequate capacity must be available and that it can adapt flexibly to load.

The Kanban technique can be applied across numerous production structure levels or operations. This results in chains of Kanban feedback loops. A comprehen­si­ve system includes external suppliers, so that close cooperation with producers is required. For purchased parts, the order to the supplier is a move card. Here again, the Kanban card can be registered and transmitted by means of bar codes.

The Kanban card operates as pull signal: it entails an order release accord­ing to consumption and a (stock) replenishment order. In [Ohno88], Ohno described the Kanban technique as the supermarket principle, as the user serves himself with the things he needs; once the shelves are emptied, they are refilled. Because of standard locations for the containers and their contents, goods provision does not involve a lot of effort. This allows small production batches.


Quiz: Find the correct answers to the following questions - not yet available
1. What is kanban ?
2. Which rules are correct for kanban use ?
3. What is correct about kanban cards ?

[kml_flashembed movie="https://opess.ethz.ch/wp-content/uploads/2016/09/Q_631.swf" height="75%" width="100%" /]

Course section 6.3: Subsections and their intended learning outcomes

  • 6.3 The Kanban Technique

    Intended learning outcomes: Explain Kanban as a technique of execution and control of operations as well as a technique of materials management. Disclose the adequate long- and medium-term planning for Kanban.

  • 6.3.1 Kanban: A Technique of Execution and Control of Operations

    Intended learning outcomes: Describe the Kanban card. Explain the Kanban feedback loop. Present in detail Kanban rules of order release and control of the feedback control system.

  • 6.3.2 Kanban: A Technique of Materials Management

    Intended learning outcomes: Present in detail the basic data for calculating the number of Kanban cards. Identify the number of Kanban cards in the system. Explain Formula to calculate the number of Kanban cards.

  • 6.3.3 Kanban: Long- and Medium-Term Planning

    Intended learning outcomes: Describe the role of a long-term plan (and, if required, a medium-term plan for resources according to an MRP II concept. Identify the lean / JIT principles that must be implemented as prerequisites for a successful implementation of the Kanban technique.

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