What means the term Kanban?

The term Kanban originates from Japan and translates roughly to “card” or “signboard.” Kanban systems are part of Production Planning and Control (PPC) and aim to streamline a company’s value chain in terms of cost and efficiency. Kanban is a replenishment strategy with a storage function, where material and information flow in opposite directions.

A key feature of Kanban is its division of production into control loops, enabling decentralized self-regulation of material flow. Based on current stock levels, Kanban ensures constant availability and optimal resource utilization. Because replenishment is triggered by downstream consumption, Kanban is ideal for Just-in-Time production.

Kanban operates using cards that contain information such as material type, quantity, and barcodes. These cards trigger reordering when stock runs low. Kanban boards help prioritize cards, and containers or digital Kanban systems offer modern, flexible alternatives.

Benefits:

• shorter lead times
• lower capital tied up in inventory
• efficient production chains
• continuous material availability
• reduced planning efforts
• higher inventory turnover

Drawbacks:

• complex implementation
• may not be suitable for all production types