Kanban is a manufacturing term used to describe a system that provides an uninterrupted supply of parts to workers to allow for continuous production. Refilling or restocking goods consistently before they completely run out means production never needs to be halted due to a lack of parts, making it very efficient. "Kanban" also directly refers to the computer order, physical card, or empty container that notifies the company it is time to reorder supplies.
The word “Kanban” is of Japanese origin and literally translates to “signal card,” referring to the reorder slip used to procure more supplies. When an assembly item or stocked item begins to run low, an employee takes the item’s reorder card to a manager, who produces or buys the needed amount. The refreshed supplies arrive before the first supply has run out, and production or sales continue without hindrance. While reorder slips used to be the norm for requesting more of an item, today computerized cards or empty packaging containers perform the same task.
Kanban is considered a “lean production” technique, or one that eliminates labor and inventory waste. One of the ways Kanban reduces waste is through the “pull production” model that regulates item production based on consumer supply and demand. Instead of estimating the number of a specific item the market will want and producing based on that amount, Kanban produces items in direct relation to the number requested by the market.
Kanban is an essential part of the Just-In-Time delivery and production technique. JIT is a mass production principle that works to reduce inventory and provide ample amounts of goods to meet customer demand without delay. It involves aspects of product management, time line projection, inventory calculation and awareness, as well as marketplace awareness. JIT strategy aims to prevent over-production, under-production, incomplete-production, and the accumulation of unused inventory.
The United States Environmental Protection Agency (EPA) strongly supports and encourages the use of Kanban techniques in mass production, as it helps decrease the affects of production waste on the environment. By meeting customer demand instead of exceeding it, Kanban is essential in eliminating environmental damage from all points of production, including the harvesting of raw production materials, gases emitted during production, and the disposal of unwanted items. It can also reduce the size and power of a factory or workshop if Kanban is incorporated into production techniques from the outset.
In spite of its benefits, the Kanban method is not suited for all production environments. For example, Kanban is not recommended for items that are part of a volatile or unpredictable market where consumer desires are fickle.