Kanban Operation is an important determinant of the success of production scheduling based on “pushing” the demand is the quality of the demand forecast that can receive such “push”. Kanban, by contrast, is part of an approach of receiving the “pull” from the demand. Therefore, the supply or production is determined according to the actual demand of the customers. In contexts where supply time is lengthy and demand is difficult to forecast, the best one can do is respond quickly to observed demand.
This is exactly what a Kanban system can help with: It is used as a demand signal that immediately propagates through the supply chain. This can be used to ensure that intermediate stocks held in the supply chain are better managed, usually smaller. Where the supply response cannot be quick enough to meet actual demand fluctuations, causing significant lost sales, then stock building may be deemed as appropriate which can be achieved by issuing more Kanban. Taiichi Ohno states that to be effective Kanban must follow strict rules of use (4)( Toyota, for example, has six rules below) and that close monitoring of these rules is a never-ending task to ensure that Kanban does what is required.
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