When Looking into various systems of replenishment, there is no doubt that the Kanban system is at the top of every list. Although the ideal system in any Organization is true single piece flow, the Kanban system can help you to adjust buffers, trigger material before it is out and free up hundreds of thousands of dollars in company assets. We often times don't realize as much as 50% of an organization's assets are usually tied up somewhere in the supply chain, for that reason Kanban has become a go to system to solve many of the problems experienced by supply chain professionals.
The Kanban can be in the form of a card, bin or even just an empty space that has been clearly labeled and identified. the simplest way to explain the Kanban system is that when the Kanban is empty it acts as the "trigger" for replenishment. Grocery stores often times have Kanban systems in place to restock shelves or trigger the re-ordering of necessary supplies. Originally the Kanban system was a "Best in Class" benchmark that was observed by Taiichi Ohno while traveling in America.
Although the Kanban is a very effective way to control activities and production rates there are a few key elements that should be put in place that will help ensure the Kanban system is accepted and Successful.
1. Clearly Label your Kanban
Be sure that the System is clearly labeled with a part number or Stock Keeping Unit, if you are using a Bin make sure the Bin has been identified and the location for the bin is clearly marked.
2. No Min/Max Quantities
What? That's right the Quantity on the Kanban should be Clearly defined; There should be no minimum or maximum buy or produce ammount, what's on the card is the number.
3. Empty Kanban, replenish
Be sure that the Kanban is the trigger to replenish and that means the only trigger. It is important to note that no counting of any form should be required if the Kanban quantity has been properly figured.
4. All Kanbans should Maintain a 5S standard and Integrity
Keep the Kanban areas in proper 5S shape, you wouldn't want any sort of mixing and matching or confusion in the Kanban system. Maintaining a 5S standard will help to keep things Visual and Organized.
5. No Purchase Orders, None
This is an important element to Kanban that is often times overlooked but honestly is very powerful to the system. The whole purpose of Kanban is to create replenishment that in one way or another frees up resources and provides the activities, actions or product you need when you need it. The Kanban card should have the same authority as a purchase order and sets the quantity for the supplier to provide. While your looking at it another element that can help free up more resources is to batch your invoices on the back side.
Kanban can be a powerful system when properly implemented into an Organization, it works during high months and low months and cuts out a lot of Forecasting errors and Fluctuation in Supply and Demand. If you are interested in Receiving the Template shown above please feel free to touch base with us by emailing email@example.com, we would also be happy to answer any additional questions you may have in stting up your Kanban system.
Although We don't Often notice it, a "Value Stream" has a flow much like the Stream you see in the photo above. The Concept of a "Value Stream" is easily understood in this analogy. Let's imagine for a second that you have clearly defined "What Value is", those elements in the Stream are the Water. Water is the Value added elements of your Value Stream or your product or service that a customer is willing to pay for, is made right the first time and is being transformed in some way.
As you may have guessed, in any Value Stream there are some "rocks in the water". Those rocks are the activities that impede the efficient flow of the Value Stream. They Could be Muda like the photo Shown below
Or they Could come from one of the other two Origins of Waste Mura and Muri. None the Less those Rocks that you see are Waste in the Value Stream. They are the elements in your shop or Office that are causing late deliveries, poor quality, frustrating processes and resources that aren't doing quite as much as they could be. Often times the rocks do not rise all the way to the top of the water, you know we see it everyday so we "work around" or "deal with" it, but they still impede the flow of the Value Stream. This is one of the main reasons we use "Value Stream Mapping", so that we can make those "Rocks" or inefficiencies in the process rise to the top and become completely visible.
One other Key element to a Value Stream Map that can be quite powerful is that it has the unique ability to capture both Information inefficiencies and Material Inefficiencies. This can be quite important as you might not realize the queue time of an email until it becomes visible.
As we begin to map multiple "Value Streams" we start to understand how each Stream begins to affect the Ocean and what the interaction between the multiple Streams is like in relation to the overall system.
Finally we get to a place where the entire system is Understood and we can now begin to plan the most efficient route forward. This part takes a great deal of time to get to and much effort too, but the results that Value Stream Mapping can bring certainly are worth the efforts. One by one you remove all the rocks in the water and eventually you look back on a well balanced, gushing stream of water or shall we say gushing "Stream of Value."
Try it out today, Map a Process out you never know, you may end up removing an entire dam.....
In this week's Series on Value Stream mapping we will look at the What, Why and How of Value Streams. Over the course of this week Lean Strategies International LLC will define what a Value Stream is and how Value Stream Mapping can assist in making the Value Stream more visual and we will talk about some reasons why Value Streams are such a powerful tool to use in any work environment. Finally we will give you one example of how a Value Stream map can be laid out.
To Start off we should define what a Value Stream is. A Value Stream includes all the steps both necessary and unnecessary steps that take a product from the early stages of a raw material or service to receiving the cash from the customer. We identify these steps as Value added and Non Value Added steps, this is why it is referred to as a "Value" stream, Some activities in the stream add value others just add waste.
There are in essence many different types of Value Stream maps, however the three most common that you will see are the Process Level map, Business or Organizational Map and finally the Extended VSM. A process level map would document activities in a specific department or a defined cell one example may be the way a purchasing department may release a purchase order if all the activities fall under that department it would be safe to say a process level map is appropriate to use. The next type of map that is used is the Business or Organizational Map, these types of maps commonly document activities that require the efforts of multiple departments in an organization. For instance if that same Purchasing process uses the efforts of planning, production, accounting and Program Managers it may be more appropriate to map the value stream with a Business type map sometimes referred to as a 3D VSM or Factory VSM. The final type of Value Stream Map is the Extended VSM, these types of Maps generally show the entire system across multiple organizations.
Let's Look at one Example of a Value Stream that may help us to understand the Value Stream a little bit better. You and I are going to eat some Taco's. We will define the Value Stream at the Process level. First- We Stand in Line to Order our Taco's Second- We place our order Third- We wait for them to check that they have everything they need Fourth- They confirm Fifth- They fix the Taco's Sixth- we receive the Taco's and Seventh- we eat the taco's
You Can probably tell by this example which activities are value added to a Customer and Which activities are not. When the Value Stream becomes visual we now have a Value Stream Map, which identifies or Map's out the activities performed in the Process.
This is a very basic example of a Value Stream map, We are sure that more details could log much more savings, but let's dig a bit deeper here. As you can tell the (Muda) or Non-Value added portion of the Value stream takes up a significant portion of our Taco trip. This is very common in Work environments too, Infact if it's the first time you have documented your value stream it is not uncommon for the Non-Value to be almost 75-80% of your Value Stream.
This brings us to our next point What we tend to do is press on the Value Added portion of the Value stream, which not only is what the Customer wants to pay for but often times will yield only seconds in savings (i.e. running machines faster than they can handle, pushing employees, unbalanced workloads) and more often than not yields broken machines or disgruntled employees. But as you can tell if we focus on the Non-Value added portion of the Value Stream and Eliminate waste we can often yield much larger results.
Hopefully you are beginning to understand the possibilities and power a Value Stream Map can bring to your Lean Strategy. Tomorrow We will look at some examples of Why you would use a Value Stream map including moving from the Current state to the Future State.