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Kanban is a visual signal that something needs to be replenished and lean manufacturers today use it to drive a process to make,

move or buy the appropriate parts, writes Thomas R. Cutler.

Thus, kanban becomes one of the fundamental building blocks of a pull (or consumption-based) replenishment system. No card = no replenishment. Kanban is a higher-order concept and all affected processes should go through an initial lean transformation to eliminate waste, establish flow and initiate a pull mindset. All processes, including equipment, must be reliable in order to minimise the inventory requirements.

Paper kanban intent had efficacy; the reality of cluttered transport routes, overflowing finished goods stores, immense quantities of WIP (work-in-progress) and unscheduled machine downtimes, often made the merits of this lean manufacturing functionality questionable. When there are also frequent complaints about delivery problems, the reality is quite distant from the theory. Poor implementation of kanban is quickly overcome in an end-to-end (E2E) pull environment.

Narayan Laksham, CEO of Ultriva, an industry thought-leader in consumption-

based processes, suggested that only E2E pull solutions focus specifically on centralising and managing all of the mission-critical data. Real-time transaction capture and tracking builds a repository of information that is ripe for process improvement analysis. There are differences between kanban (a signal to trigger specific quantities of supplies in a just-in-time system) versus an E2E pull solution working more efficiently and effectively with a lean process. Blanket purchase orders, internal consumption signals replenishment and initiating proactive suppliers are three direct results of lean E2E pull processes. E2E pull collaboration erases supplier fears since electronic records of pull requests, receipt timestamps and electronic acknowledgements all work towards a more unified and dependable method of pull communication.

E2E pull captures real-time data information and makes it available for historical analysis. It is made available over the internet 24 hours a day, so that all parties can see trends in performance. Late shipments, short shipments and other supply chain performances are all captured and presented in terms of percentage of conformance to the service level agreement. These visuals give everyone in the supply chain information about how to focus the

best possible continuous improvement activities.

Rationale for E2E pull as the most lean manufacturing componentE2E pull consumption-based processing is heavily based on lean and Six Sigma principles and tools. This critical lean element is focused on improving flexibility through the elimination of waste, quantifying the flexibility so that manufacturers and suppliers can rapidly evaluate the true capability of the system to respond to specific changes. Implementing pull with more customers, suppliers and vendors is expected to double in 2014 and triple by 2015. Whether called e-kanban or some other name, E2E pull-based systems require that all non-value-added activities are eliminated or reduced in order to shrink the required lead times.

Author profile: Thomas R Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler Inc (www.trcutlerinc.com). He is the founder of the Manufacturing Media Consortium, which includes more than 5,000 journalists, editors and economists writing about trends in manufacturing, industry, material-handling and process improvement. He authors more than 500 feature articles annually regarding the manufacturing sector and is the most published freelance industrial journalist worldwide. Contact him at trcutler@trcutlerinc.com or follow him on Twitter – @ThomasRCutler.

Reducing inventory in lean E2E pull environment

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