One key difference between lean production and traditional mass-production is how necessary supplies are provided. Traditional mass production systems tend to use a push system in which the amount of supplies, and the schedule for generating them, is determined by guesswork rather than actual demand. The producer orders a certain amount of supplies, an act that requires a lot of estimation and capital outlay ahead of time.
The supplies show up at the factory on a predetermined date, where they must be stored until they will be used. If the earlier guess was wrong, there will either be too many supplies (if demand is lower than expected) or too few (if demand is higher than expected). In terms of waste, any errors in guessing how many supplies should be pushed to the factory by the contractual agreement will result in either extra inventory or extra waiting, both of which are costly.
Lean production methods take a different approach to supply, choosing to pull the supplies from the supplier (either internal or external) according to the demand for them right now rather than making guesses about the future. This is often handled simply using a “supermarket” style system called kanban.
In a kanban-style system, when a process nears the end of its supplies, a signal is generated that tells the supplier that more of the supply should be made. The supplier makes more supplies and delivers them back to the production line where they are immediately put to use. There are no extra inventories and no long periods of waiting for supplies, since they are generated as needed and only as needed.
The kanban approach is much more responsive to customer demand and much more efficient for everyone involved. However, a kanban system requires a great deal of trust between a supplier and a producer. Both must work hard to keep demand as level as possible to avoid overwhelming each other with too-intense demand or too many unneeded surpluses. Both must also feel secure in their long-term relationship, since they will be responding to customer demand together rather than guaranteeing profits by enforcing pre-set supply volumes regardless of circumstances.
A critical component of the kanban system is the kanban card, the specific signal that is sent to the supplier to indicate more supplies are needed. The signal can be as simple as the empty supply container being sent back to the upstream supplier, or it can be an actual card with specific information about the part that is needed and in what amount. It can even be part of an electronic kanban system where the necessary information is sent electronically rather than physically, saving further by eliminating some wasted object transportation and personnel motion.
Whichever form it takes, the kanban “card” is the signal that says what kind and how much work must be done by the supplier or process immediately upstream, and it must be calibrated carefully to match actual demand.
A simple kanban signal I use in everyday life is the laundry basket. As I’ve said before, our laundry gets sorted into five separate baskets when it reaches the bottom of the laundry chute. When one of the baskets is full at laundry time, that basket of clothes gets washed.
In this scheme, choosing a proper-sized laundry basket is important. If a basket is too large, it will take too long to fill with laundry and the clothes it holds won’t get washed often enough. If the basket is too small, it will fill too quickly and the clothes will get washed more often than they are really required. In other words, with wrong-sized baskets acting as our kanban signals, our production of clean clothes won’t match our demand for them.
To get things calibrated more precisely, I recently switched the small basket for childrens’ clothes, which was filling too quickly and leaving us with more clean kids’ clothes than we needed, with the large basket for white clothes, which was filling too slowly and leaving us with too few clean white shirts and socks. The idea is to level out the demand so that each basket will fill in a similar amount of time, allowing me to stick to a “one load a day” washing schedule that allows our clothes to be washed at a pace that is neither too fast or too slow to meet our demand. Switching the smaller basket to the whites and the larger basket to kids’ clothes recalibrated the system and solved the problem.
(For another example of everyday kanban, here’s a good approach to keeping paper towels and bath tissue supplied steadily at home, one that I’ve started using myself.)
Switching to a pull-based system rather than a push-based system can have a big impact on the efficiency of the overall system, but like everything in the lean approach, there’s always more fine-tuning and constant small improvements to be made.