Kanban

Kanban (Japanese: かんばん [kambaɴ] meaning signboard) is a scheduling system for lean manufacturing (also called just-in-time manufacturing, abbreviated JIT). Taiichi Ohno, an industrial engineer at Toyota, developed kanban to improve manufacturing efficiency. The system takes its name from the cards that track production within a factory. Kanban is also known as the Toyota nameplate system in the automotive industry.
A goal of the kanban system is to limit the buildup of excess inventory at any point in production. Limits on the number of items waiting at supply points are established and then reduced as inefficiencies are identified and removed. Whenever a limit is exceeded, this points to an inefficiency that should be addressed.
In kanban, problem areas are highlighted by measuring lead time and cycle time of the full process and process steps. One of the main benefits of kanban is to establish an upper limit to work in process (commonly referred as “WIP”) inventory to avoid overcapacity. Other systems with similar effect exist, for example CONWIP. A systematic study of various configurations of kanban systems, such as generalized kanban or production authorization card (PAC) and extended kanban, of which CONWIP is an important special case, can be found in Tayur (1993), and more recently Liberopoulos and Dallery (2000), among other papers.