e-kanban aims beyond equivalent of visual cue
By April Terreri, contributing editor -- Manufacturing Business Technology, 4/1/2004 7:00:00 AM
Lean manufacturing appeals to many because of its simplicity. The lean philosophy says adjust your production lines and resources to build to demand in smaller lot sizes, and use simple visual cues such as kanban replenishment to execute production.
While systems for electronic kanban—or e-kanban—are coming on the scene and helping companies like AGCO, a manufacturer of agricultural equipment, make gains, the systems must reflect lean replenishment rules, not just substitute an electronic cue for a visual one. At AGCO's Jackson, Minn.-based plant, .exe's Crossroads e-kanban system is credited with helping reduce indirect labor by between 20 percent to 30 percent just four months after deployment, says Julie Deans, IT site director. "Through our e-kanban database, we generate about 1,000 manufacturing and purchase orders every day," says Deans.
Richard Grilli, president of .exe, says "electronic kanban is a method of requesting parts needed in the manufacturing process by using bar-code technologies. Shooting a bar code on an empty kanban container initiates a request for parts replenishment from one of three places: from the vendor, the warehouse, or from manufacturing."
Both Deans and Grilli say the system must reflect the correct procedures. "You have to define what the kanban [parts container] quantities are, what the pull sequences are, and where parts are coming from before they get to the final point of use," explains Grilli. "You also have to define lead times and make certain your vendors will be able to supply within specific lead times."
Grilli adds that .exe's solution runs on IBM's iSeries (formerly AS/400) platform. "That fits in especially well with IBM-based operations," he says. Systems for e-kanban, Grilli says, also need to easily integrate with data residing in ERP systems.
Another issue is ease of use of the actual system. "[The] system is very simple and it empowers our manufacturing people, bringing them right into the process," Deans says.
Greg Gorbach, a research director with Dedham, Mass.-based analyst firm ARC Advisory Group, notes that in addition to major ERP vendors that have lean manufacturing functionality, a mix of other vendors also support aspects of lean. Says Gorbach, "You'll find supply chain companies and production management companies also are providing these kinds of e-kanban solutions."
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