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1 2003 Alcoa Inc. ABS AlcoaBusiness System ABS AlcoaBusiness System かかかか KANBAN CALCULATIONS

KanbanCalculations_Tutorial

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Page 1: KanbanCalculations_Tutorial

12003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business Systemかんばん

KANBANCALCULATIONS

Page 2: KanbanCalculations_Tutorial

22003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Learning Objectives:

Understand the philosophy of Kanban and its role in JIT productionUnderstand the types of Kanban and the proper use of eachBe able to properly calculate the number of Kanban needed in a particular application

Page 3: KanbanCalculations_Tutorial

32003 Alcoa Inc.

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KANBAN

Agenda

Philosophy and Role of KanbanKanban System Review Kanban Calculations20 QuestionsClassroom Exercise

Page 4: KanbanCalculations_Tutorial

42003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Tutorial Takt Time

'3

54150

60' Exercise Class

per slide

slides'

utputrequired otimeavailable Takt Time

Page 5: KanbanCalculations_Tutorial

52003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

The Toyota Production System

JUST-IN-TIME

• Continuous Flow• Pull System• Takt Time

AUTONOMATION

(Jidoka)• “Automation with a Human Touch”• Machines Stop for Abnormalities• Separate Man & Machine• Error Proofing (Pokayoke)

GOALS: Best Quality Lowest Cost Shortest Lead Time

KEY IS: Thorough Elimination of Waste

Leveling(Heijunka)

StandardizedWork

Continuous Improvement(Kaizen)

STABILITY(Equipment Reliability, Stable Processes, Quality,

Suppliers)People

SafetyTeamwork

Growth

KANBAN

Page 6: KanbanCalculations_Tutorial

62003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Why Just-in-Time Production?Customer can get what is needed, at the time needed, in the amount needed.Supplier produces the quantity just taken.“If parts arrive anytime prior to their need – not at the precise time needed – waste cannot be eliminated.”

Taiichi Ohno June 1987

Customer

DCBA

SupplierBCD

A A

Page 7: KanbanCalculations_Tutorial

72003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Why Pull?“Manufacturers and workplaces can no longer base production on desk-top planning alone and then distribute, or push, their products onto the market.

It has become a matter of course for customers, or users, each with a different value system, to stand in the frontline of the marketplace and, so to speak, pull the goods they need, in the amount and at the time they need them.”Taiichi Ohno

June 1987

Page 8: KanbanCalculations_Tutorial

82003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Time and QuantityStrategies for PullDiscussion Point Fixed Time Fixed Quantity

InventorySupplier must adapt to

variable quantitiesSupplier must adapt to

variable times

Withdrawal time Fixed Varies

Quantity withdrawn Varies Fixed

UsageDisconnected processes

Long conveyance distances

Connected processesShort conveyance

distances

Adapted From: Lean Production Simplified A Plain-Language Guide to the World’s Most Powerful Production System

Page 9: KanbanCalculations_Tutorial

92003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Why Kanban?Kanban is a way to achieve just-in-time; its purpose is just-in-time [a test of one-piece flow].The kanban system makes clear what must be done by workers, managers and supervisors.The goal of eliminating waste is highlighted by kanban.“In the production plant, kanban is a powerful force to reduce manpower and inventory, eliminate defective products, and prevent the recurrence of breakdowns.”

Taiichi Ohno

June 1987

Page 10: KanbanCalculations_Tutorial

102003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

What is Kanban?Kanban is a Signboard or SignalIt Carries Information:

Pick-upTransferProduction

A Tool for:Realizing Just-in-TimeVisual Control of ProductionPromoting Improvement

“The operating method of the Toyota production system is kanban.”

Taiichi OhnoJune 1987

Page 11: KanbanCalculations_Tutorial

112003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Kanban Types

Adapted From: TOYOTA PRODUCTION SYSTEM An Integrated Approach to Just-In-Time

Kanban

Production Kanban

MoveKanban

1 x 1 ProductionKanban

SignalKanban

Process MoveKanban

Supplier MoveKanban

Page 12: KanbanCalculations_Tutorial

122003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Kanban System

Move: Where to go? What to get? How many? Where to take?Production: What to make? How many? Storage location?

Supply Stamp Assemble

Stage

LevelingLot Making

Supplier

Move

(Distant)

Production

Signal

Process

Move

(Close)

Production

1 x 1

(Lot Making)

Process

Move

(Close)

Page 13: KanbanCalculations_Tutorial

132003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Kanban System TypesType A System:• High volume & low variety• Specific to a product• Uses stores• Shorter lead times• Arrow comes down at end of flow• Inventory generally higher, due to

stores

Type B System:• Low volume & high variety• Generic, not part specific• Uses FIFO queues• Longer lead times• Arrow comes down at start of flow• Inventory generally lower, due to

queues

Page 14: KanbanCalculations_Tutorial

142003 Alcoa Inc.

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KANBAN

Supplier Move Kanban

Supplier Move Kanban…removed when item is withdrawn from store

StoresStores A 1-1 A 1-1

ShelfShelf 7-C 7-C

Page 15: KanbanCalculations_Tutorial

152003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Pick-up Pick-up AJAJ

Process Move Kanban

Process Move Kanban…removed when first item is withdrawn from

container

AssemblyAssembly AJ AJ

Page 16: KanbanCalculations_Tutorial

162003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Signal Kanban AssemblyAssembly AJ AJ

StoreStore B-9 B-9

Signal Kanban…removed when withdrawals are made

down to the container tagged

FIFOSignals

Count from the bottom

Page 17: KanbanCalculations_Tutorial

172003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Production Kanban

Production Kanban (1 x 1)…removed when item is withdrawn from store

StampingStamping AJ AJ

StoreStore A33 - 5 A33 - 5

FIFOProduction

Page 18: KanbanCalculations_Tutorial

182003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Kanban RulesFunction Rule

Provides pick-up or transportation information

Consumer picks up the number of items indicated (by the Kanban) at the supplier

Provides production information Supplier produces items in the quantity and sequence indicated by the Kanban

Prevents overproduction and excessive transport

No items are made or transported without a Kanban

Serves as a work order attached to goods

Always attach a Kanban to the goods

Prevents propagation of defective products by identifying the process making the defects

Do not send defective products to the consumer

Reveals existing problems and controls inventory (use Kanban to discover areas for improvement)

Reduce the number of Kanban to increase sensitivity (better to reveal missing items and line-stopping problems)

Adapted From: TOYOTA PRODUCTION SYSTEM An Integrated Approach to Just-In-Time

Page 19: KanbanCalculations_Tutorial

192003 Alcoa Inc.

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KANBAN

Kanban and Rules-in-UseRule MRP Kanban

1 Activity is variable (situational)

Activity is pre-specified and tested

2 Connections are subjective and indirect:

Worker Computer ManagerWorker Computer Manager

Connections are binary, direct and tested:

Worker WorkerWorker Worker

3 Pathways are conditional: Pathways are pre-specified, simple and tested:

4 Problems discovered after-the-fact and away from the point of cause

Problems are discovered (by design) in the path of the work, at the point of cause

Page 20: KanbanCalculations_Tutorial

202003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Determining Number of KanbanTYPE Use Need to determine

Production

1 x 1(kanban-to-

kanban)

Negligible c/o time(no stagnation due

to lot making) Number of kanban

Lot Making

Moderate c/o time(not possible to use

signal kanban)

Number of kanban Lot size/Trigger

points

SignalModerate to long

c/o time Lot size Order points

MoveProcess Short distances

(store to line-side) Number of kanban

Supplier Long distances(external supplier)

Page 21: KanbanCalculations_Tutorial

212003 Alcoa Inc.

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KANBAN

1x1 Production (Kanban-to-Kanban)Need to know:

Daily demandScheduled daily work timeMachine time per pieceContainer capacityPull quantity / sequence variation

Need to determine:

Consumption rateProduction lead timeNumber of kanban

Key Points:

No stagnation due to lot making (negligible c/o time)Variation comes into play from lead time and/or pull fluctuation

Page 22: KanbanCalculations_Tutorial

222003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Kanban-to-Kanban ExampleProduct

Machine Cycle

Container

Capacity

Monthly Demand

Weekly Demand

Daily Demand

A 2’ 5 1560 360 60

B 0.5’ 5 2340 540 90

C 0.5’ 5 4680 1080 180

A B C

AssembleStage &

Ship

3

A 1 1 1 1 1

B 1 2 1 2 1

C 3 2 3 2 3

Pitch(30’)

Pro

du

ct

Process move kanban used to withdraw single item from storeProduction kanban removed and placed in collection box

7 hr / day Production

(420’)

1x1 Production

Containers

Page 23: KanbanCalculations_Tutorial

232003 Alcoa Inc.

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KANBAN

capacityContainer

rate nConsumptio time lead Production kanban ofNumber

1x1 Production

Additional kanban needed to compensate for:Pull sequence fluctuationPull quantity fluctuationProduction lead time fluctuation

Production lead time: total time to replenish an itemConsumption rate: (peak) rate at which parts are pulled from the storeContainer capacity: amount of product within a store container

ProductMachine

Cycle

Container

Capacity

Monthly Demand

Weekly Demand

Daily Demand

A 2’ 5 1560 360 60

B 0.5’ 5 2340 540 90

C 0.5’ 5 4680 1080 180

A B

C

A

B C

A B

C

A

B C

Level withdrawal

5 5 5 5

A

A

CC

A

BC

A

C B

A A

Fluctuation in sequence and quantity

36 7 7

Page 24: KanbanCalculations_Tutorial

242003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

capacityContainer

rate nConsumptio time lead Production kanban ofNumber

1x1 Production

Additional kanban needed to compensate for:Pull sequence fluctuationPull quantity fluctuationProduction lead time fluctuation

Alternate Representations…

capacityContainer

rate nConsumptio time lead Production kanban ofNumber

Page 25: KanbanCalculations_Tutorial

252003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN

Safety Coefficient ≠ Safety Stock

Machine X-01 Product 'A'

0

10

20

30

40

50

60

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Observation Number

Prod

uctio

n Le

ad T

ime

Safety Stock:

Held separately from store‘Special Cause’ variationEquipment downtimeMajor quality incidentAssigned to a specific cause

Safety Coefficient:

Built–in to store‘Common Cause’ variation

Minor delaysMinor fluctuation in pullTend to be random in

nature

Stretch Wrapper failure

Page 26: KanbanCalculations_Tutorial

262003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBANExample 1 – Level withdrawal (c/o time ≈ 0) 1x1 Production

Product

CycleTime

Container

Capacity

Monthly Deman

d

Weekly Demand

Daily Deman

d

C / OTime

Time per

Container

TotalTime

ConsumptionRate (peak)

A 2’ 5 1560 360 60 10” 10’ 120’ 5 / 30’

B 0.5’ 5 2340 540 90 5” 2.5’ 45’ 10 / 30’

C 0.5’ 5 4680 1080 180 5” 2.5’ 90’ 15 / 30’

Assemble

3

B

A 1 1 1 1 1 1

B 1 2 1 2 1 2

C 3 2 3 2 3 2

Pitch(30’)

Pro

du

ct

CA

Production lead time (max) =

① kanban collection time +

② kanban stagnation time +

③ machine (+ c/o) time +

④ conveyance time

② ③ ④

2’

17.9’ 2.6’ 3’

Product

Production Lead Time(max)

Consumption

Rate(peak)

Container

Capacity

No. of Kanban*

(min)

A 25.5’ 5 / 30’ 5 1

B 25.5’ 10 / 30’ 5 2

C 25.5’ 15 / 30’ 5 3

Prod

uct

B as a

n

exam

pl

e

……

Containers

Page 27: KanbanCalculations_Tutorial

272003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN1x1 ProductionExample 1 – Level withdrawal

3 3 3 3 3 3 3 3

3 3 3 3 3 3 3 3

30’ pitch

25.5’ 25.5’

Maximum production lead time – level withdrawal, no fluctuation*

Leveled production sequence

C

C

CB

AB

C

CB

A

C

C

CB

AB

C

CB

A

C

C

CB

AB

C

CB

A

C

C

CB

A

Page 28: KanbanCalculations_Tutorial

282003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Product

CycleTime

Container

Capacity

Monthly Deman

d

Weekly Demand

Daily Deman

d

C / OTime

Time per

Container

TotalTime

Consumption

Rate

A 2’ 5 1560 360 60 10” 10’ ±2’120’ ±20’

5 ±5 / 30’

B 0.5’ 5 2340 540 90 5”2.5’

±0.5’45’ ±9’ 10 ±5 / 30’

C 0.5’ 5 4680 1080 180 5”2.5’

±0.5’90’

±18’15 ±10 /

30’

1x1 ProductionExample 2 – Lead Time, Sequence and Quantity Fluctuation

Assemble

3

?

A 2 1 2 2 2 2

B 1 2 2 3 2

C 3 2 2 3 5 1

Pitch(30’)

Pro

du

ct

??

② ③ ④

2’

? ? 3’

Product

Production Lead Time(est.)

Consumption

Rate(est.)

Container

Capacity

No. of Kanban*

(est.)

A 44.3’ 10 / 30’ 5 3

B 44.3’ 15 / 30’ 5 5

C 44.3’ 25 / 30’ 5 8

What

is

the

product

i

on le

ad

time?

Containers

Estimated fluctuation in machine time: up to 20% Estimated fluctuation in consumption rate: up to 100%Estimated increase in kanban needed: 1.20 x 2.00 = 2.40, or 240% of Example 1

Page 29: KanbanCalculations_Tutorial

292003 Alcoa Inc.

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ABSAlcoa Business System

KANBAN1x1 ProductionExample 2 – Lead Time, Sequence and Quantity

Fluctuation

3 3 3 3 3 3 3

3 3 3 3 3 3 3

30’ pitch

AA

B

CC

C

C

CC

AB

BC

AA

BB

CC A

AC

C

CC

C

C

A

CC

CC

AB

BB

AA

CC

CC

C

CC

C

2xB

1xC

25.5’ 44.3’

Net effect of fluctuation is to extend production lead time – more inventory is required

Page 30: KanbanCalculations_Tutorial

302003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBANExample 2 – Lead Time, Sequence and Quantity Fluctuation

1x1 Production

ProductContaine

r Capacity

Present Month ProductionQuantity

Daily Production Quantity

Lot Size

Kanban Master - Number

ProductionPresent

ProductionPrevious

Change( + / -)

A 5 1560 60 5 3 2 1

B 5 3120 120 5 5 5 0

C 5 4680 180 5 8 10 -2

Containers are brought to the store as they are produced with the Production Kanban attachedEach Production Kanban is returned as the individual item (container) is withdrawnContainers are produced 1x1 in the order in which Kanban are received

CA B

Additional inventory needed due to fluctuation

Page 31: KanbanCalculations_Tutorial

312003 Alcoa Inc.

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KANBAN

Signal KanbanNeed to know:

Daily demandScheduled daily work timeC/O timesMachine time per pieceContainer capacity

Key Points:Choose appropriate replenishment strategy:fixed time, fixed quantity or combinationAdditional lead time due to lot making, etc.

Need to determine: Number of C/O

possible per day Lot size Consumption rate Production lead

time Order point

Page 32: KanbanCalculations_Tutorial

322003 Alcoa Inc.

ABSAlcoa Business System

ABSAlcoa Business System

KANBAN

Signal Kanban ExampleProduct

Machine Cycle

Container

Capacity

Monthly Demand

Weekly Demand

Daily Demand

A 2’ 5 1560 360 60

B 1’ 5 3120 720 120

C 1’ 5 4680 1080 180

A B C

Stamp Pack

3

Process move kanban used to withdraw single item from storeSignal kanban removed when exposed and placed in collection box

Signal

7 hr / day Production(420’)

Page 33: KanbanCalculations_Tutorial

332003 Alcoa Inc.

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KANBAN

capacityContainer

rate nConsumptio time lead Production Point Order

Additional lead time needed to compensate for:Pull sequence fluctuationProduction sequence variationProduction lead time fluctuation

Production lead time: total time to replenish the first container of the lotConsumption rate: (peak) rate at which parts are pulled from the storeContainer capacity: amount of product within a store container

Signal

Lot size is determined based upon replenishment strategy:

dayper C/O ofNumber

day each required ionsSpecificat Time Fixed

dayper C/O ofNumber

day each required Pieces Quantity Fixed

Page 34: KanbanCalculations_Tutorial

342003 Alcoa Inc.

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ABSAlcoa Business System

KANBANExample 3 – Fixed Quantity Replenishment

ProductCycleTime

Container Capacity

Monthly Demand

Weekly Demand

Daily Demand

C / OTime

A 2’ 5 1560 360 60 3’

B 1’ 5 3120 720 120 4’

C 1’ 5 4680 1080 180 5’

Signal

General purpose machine – c/o time does not yet allow 1x1Scheduled production time is 7:30 per 9 hr day, 6 days per week

Determine (per day):Time Available 7.5 hr x 60’ / hr = 450’Pieces Needed 60 + 120 + 180 = 360Machine Time 120’ + 120’ + 180’ = 420’Available C/O Time

Available - Machine 450’ – 420’ = 30’

Longest c/o time max {3’, 4’, 5’} = 5’

Maximum C/O’s possibleAvailable ÷ Longest c/o 30’ ÷ 5’ = 6

Lot Size

Pieces Needed ÷ c/o’s 360 ÷ 6 = 60

ProductLot Size / Daily

DemandLots Needed

per Day

A 60 ÷ 60 = 1 1 / day

B60 ÷ 120 =

0.5 2 / day

C60 ÷ 180 =

0.33 3 / day

C/O Run M T W T F S

4’ 60’ B B B B B B

5’ 60’ C C C C C C

3’120

’A A A A A A

5’ 60’ C C C C C C

4’ 60’ B B B B B B

5’ 60’ C C C C C C

Check for consistency

Daily C/O time: 26’

Daily run time: 420’

Plan is consistent, now determine order point(s)

Page 35: KanbanCalculations_Tutorial

352003 Alcoa Inc.

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KANBAN

Stamp

3

B

Product

CycleTime

Container

Capacity

Monthly Deman

d

Weekly Demand

Daily Deman

d

C / OTime

Lot Size

MachineTime

A 2’ 5 1560 360 60 3’ 60 120’

B 1’ 5 3120 720 120 4’ 60 60’

C 1’ 5 4680 1080 180 5’ 60 60’

Example 3 – Fixed Quantity Replenishment Signal

A

C

② ③ ④

2’

3’188’ 9’

Production lead time (max) =

① kanban collection time +

② kanban stagnation time +

③ machine (+ c/o) time +

④ conveyance time

Product

Production Lead Time(max)

Consumption

Rate(peak)

Container

Capacity

Order Point*(min)

A 147’ 30 / 60’ 5 15

B 202’ 60 / 60’ 5 41

C 202’ 60 / 60’ 5 41

Prod

uct

B as a

n

exam

pl

e

time to replenish the first container of the lot

Page 36: KanbanCalculations_Tutorial

362003 Alcoa Inc.

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KANBANExample 3 – Fixed Quantity Replenishment Signal

ProductContaine

r Capacity

Present Month ProductionQuantity

Daily Production Quantity

Lot Size

Kanban Master - Number

TriangularPresent

TriangularPrevious

Change( + / -)

A 5 1560 60 60 15 12 3

B 5 3120 120 60 41 48 -7

C 5 4680 180 60 41 48 -7

A

15

B

41

C

41

Containers are brought to the store as they are producedThe Signal Kanban is brought along with the last container of the lot and placed on the specified containerIf fewer than the specified number of containers are present, the Signal Kanban is returned immediately

Page 37: KanbanCalculations_Tutorial

372003 Alcoa Inc.

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KANBANExample 4 – Fixed Time Replenishment

ProductCycleTime

Container Capacity

Monthly Demand

Weekly Demand

Daily Demand

C / OTime

A 2’ 5 1560 360 60 3’

B 1’ 5 3120 720 120 4’

C 1’ 5 4680 1080 180 5’

Signal

General purpose machine – c/o time does not yet allow 1x1Scheduled production time is 7:30 per 9 hr day, 6 days per week

Determine (per day):Time Available 7.5 hr x 60’ / hr = 450’Specifications Needed

3Machine Time 120’ + 120’ + 180’ = 420’Available C/O Time

Available - Machine 450’ – 420’ = 30’

Longest c/o time max {3’, 4’, 5’} = 5’

Maximum C/O’s possibleAvailable ÷ Longest c/o 30’ ÷ 5’ = 6

Lot Size

Specs Needed ÷ c/o’s 3 ÷ 6 = 0.5 day

ProductLot Size / Daily

DemandLots Needed

per Day

A 0.5 x 60 = 30 2 / day

B 0.5 x 120 = 60 2 / day

C0.5 x 180 =

902 / day

C/O Run M T W T F S

3’ 60’ A A A A A A

4’ 60’ B B B B B B

5’ 90’ C C C C C C

3’ 60’ A A A A A A

4’ 60’ B B B B B B

5’ 90’ C C C C C C

Check for consistency

Daily C/O time: 24’

Daily run time: 420’

Plan is consistent, now determine order point(s)

Page 38: KanbanCalculations_Tutorial

382003 Alcoa Inc.

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KANBAN

Stamp

3

A

Product

CycleTime

Container

Capacity

Monthly Deman

d

Weekly Demand

Daily Deman

d

C / OTime

Lot Size

MachineTime

A 2’ 5 1560 360 60 3’ 30 60’

B 1’ 5 3120 720 120 4’ 60 60’

C 1’ 5 4680 1080 180 5’ 90 90’

Example 4 – Fixed Time Replenishment Signal

B

C

② ③ ④

2’

3’159’ 13’

Production lead time (max) =

① kanban collection time +

② kanban stagnation time +

③ machine (+ c/o) time +

④ conveyance time

Product

Production Lead Time(max)

Consumption

Rate(peak)

Container

Capacity

Order Point*(min)

A 177’ 30 / 60’ 5 18

B 172’ 60 / 60’ 5 35

C 142’ 60 / 60’ 5 29

Prod

uct

A as a

n

exam

pl

e

time to replenish the first container of the lot

Page 39: KanbanCalculations_Tutorial

392003 Alcoa Inc.

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KANBANExample 4 – Fixed Time Replenishment Signal

ProductContaine

r Capacity

Present Month ProductionQuantity

Daily Production Quantity

Lot Size

Kanban Master - Number

TriangularPresent

TriangularPrevious

Change( + / -)

A 5 1560 60 30 18 15 3

B 5 3120 120 60 35 30 5

C 5 4680 180 90 29 36 -7

A

18

B

35

Containers are brought to the store as they are producedThe Signal Kanban is brought along with the last container of the lot and placed on the specified containerIf fewer than the specified number of containers are present, the Signal Kanban is returned immediately

C

29

Page 40: KanbanCalculations_Tutorial

402003 Alcoa Inc.

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KANBAN

Production (Lot Making)Need to know:

Daily demandScheduled daily work timeMachine time per pieceContainer capacityPull quantity / sequence variation

Need to determine:

Consumption rateProduction lead timeNumber of kanbanLot size / Trigger point

Key Points:

Stagnation due to lot making Variation comes into play from lead time and/or pull fluctuation

Page 41: KanbanCalculations_Tutorial

412003 Alcoa Inc.

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KANBANProduction – Lot Making

For some product forms, a signal kanban is not practical

As kanban are received, they are placed on a lot-making board

Each product type or specification has a pre-specified trigger which determines the economic lot size to be run

As each trigger is reached the pre-determined number of kanban is removed and placed in the production queue

Waiting to triggerProduction lead time is increased (compared to signal kanban) due to additional kanban stagnation on the lot making board

rate nConsumptio sizelot Practical Time Stagnation Kanban Additional

Page 42: KanbanCalculations_Tutorial

422003 Alcoa Inc.

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KANBAN

Show me!

Page 43: KanbanCalculations_Tutorial

432003 Alcoa Inc.

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KANBAN

Show me!

Casting Pit

Example

Page 44: KanbanCalculations_Tutorial

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KANBAN

Process Move KanbanNeed to know:

Time to make standard delivery cycleConsumption rateContainer capacity

Need to determine:Number of kanban

Key Points:

Proximity of consuming process to up-stream store

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KANBAN

Process Move Kanban Example

Assemble Pack

3

Process Move

Reasonable proximity

Line-side supply

Up-stream store

Process move kanban removed as first part is used at lineKanban are collected and new containers delivered to line from up-stream store

ProductContainer Capacity

Consumption Rate

Delivery Cycle

A 5 30 / 60’ 15’

B 5 60 / 60’ 15’

C 5 60 / 60’ 15’

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KANBANProcess Move

2capacityContainer

rate nConsumptio cycleDelivery kanban ofNumber

Delivery cycle: time to complete a standard delivery cycleConsumption rate: (peak) rate at which parts are usedContainer capacity: amount of product within a store container

Multiply by 2 in case signal for more product occurs just after delivery person leaves – it will be two full delivery cycles before product is brought

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KANBAN

ProductContain

er Capacity

Consumption Rate

Delivery Cycle

No. of Kanban

A 5 30 / 60’ 15’ 3

B 5 60 / 60’ 15’ 6

C 5 60 / 60’ 15’ 6

Example 5 –Process Move Kanban Process Move

A B C

Line-side inventory -- each container with a Move Kanban

Pack

Product A

Product B

Product C

3 25

)60' / (30 5'1 kanban No.

6 25

)60' / (60 5'1 kanban No.

6 25

)60' / (60 5'1 kanban No.

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KANBAN

Supplier Move KanbanNeed to know:

Daily consumptionContainer capacitySafety inventory required to offset supplier or conveyance fluctuationAgreed upon delivery cycle

Need to determine:Number of kanban

Key Points:

Used when distance between supplier and customer is significant

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KANBAN

Supplier Move Kanban Example

Supplier 21-1-2

Supplier 11-2-1

2

Assemble

Factory

Significant conveyance timeParts delivered to central receiving / store

Process move (withdrawal) kanban used to convey parts to line

PartSupplie

r

Container

Capacity

Consumption Rate

Delivery Cycle

A-001 1 10 100 / day 1-2-1

B-002 2 5 50 / day 1-1-2

Supplier Move

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KANBANSupplier Move

tcoefficienSafety 1

capacity Container nconsumptioDaily kanban ofNumber

YZX

Daily consumption: (peak) rate at which parts are usedContainer capacity: amount of product within a store containerSafety coefficient: amount of product held to safeguard against delivery fluctuation (in days’ supply)

Delivery cycle: Agreed upon delivery cycle stated as three numbers X-Y-Z

in X days (time for 1 conveyance interval), there are Y deliveries (number of shipments per

cycle), with parts returned Z shipments after Kanban are

sent to supplier X"" than lessnot integer smallest the means X

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KANBANSupplier Move

PartSupplie

r

Container

Capacity

Consumption Rate

Delivery Cycle

Safety Coefficient

No. of Kanban

A-001 1 10 100 / day 1-2-1 0.5 day 15

B-002 2 5 50 / day 1-1-2 1 day 40

Part A-001 / Supplier 1

Part B-002 / Supplier 2

15day 5.02111

10100/day kanban No.

40day 1 1

2115

50/day kanban No.

Supplier 21-1-2

Customer

(kanban) containers 20

days 2/day x containers 10

ycledelivery/c 1

latency deliveries 2 x day/cycle 1

nerpcs/contai 5

pcs/day 50

supplierat transit in kanban No.

(kanban) containers 20

days 2 /day containers 10

ycledelivery/c 1 day/cycle 1

iner5pcs/conta

50pcs/day

safety store customer at kanban No.

safetyday 1

Example 6 – Supplier Move Kanban

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KANBAN

Kanban Maintenance

Planning

Product Database

Monthly Forecast

Bill of materials for each finished product

Monthly demand forecast

MaterialRequirements

Daily / weekly requirements of materialsNumber of containers / palletsProduction schedule(s)

Kanban MasterPlan

Number of kanban requiredComparison of current against previous periodReorder pointsLot sizes

Capacity Plan

Cycle time at each processProcessing time per lot per processSetup time per process

Example

PFEPPlan For

Every Part

Kanban Audit

Kanban are numberedNumbers are collected in the path of workMissing Kanban are identified

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KANBAN

20 Questions (more or less…)1. What does “Kanban” mean?2. What is the origin of Kanban in TPS?3. What is its role in JIT?4. What are the Kanban types?

Are they interchangeable?Why?

5. What are the types of Kanban systems?

Which has the shortest lead time?Which requires the least inventory?

6. What are the prerequisites for using Kanban?

7. What are the Rules of Kanban?8. What is the basic Kanban calculation?9. How is Lot Size determined?

1. What is the role of the Safety Coefficient?

…of Safety Stock?2. How often should Kanban be adjusted?

By whom?3. What are the strategies for pull?

Is one superior?Why?

4. What are the basic replenishment strategies?

What are their relative advantages and disadvantages?What is the ideal?

5. How does Kanban align with the RIU?

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ABSAlcoa Business System Class Exercise

KANBANCALCULATIONS

Me First!

Then Me!