The Art of Kanban - Creative Safety Supply April 2014 | Page 13

The Art of Kanban
Storing excess inventory is usually not the best use of space. One of the other
big drawbacks to holding onto an inventory of components is the risk of
having to waste them when a part is upgraded.
Since your company will also be using Kaizen and looking for ways to make
improvements it is likely that components will be upgraded or changed on a
regular basis. If you store excess components you will have to dispose of
them every time an improvement is made. This wastes a great deal of money
in addition to the space and manpower needed to deal with the materials.

By the same token you will reduce the amount of waste and scrap materials
you produce. Again, costs will be cut and your needs for storage will lessen
because you will only keep the raw materials that you need at a specific time.
Once those diminish, more materials will be delivered so you will not lag in
production, nor will you overproduce in an effort to use up excess materials.

Flexibility
When you manufacture something, production is never on the one constant
level. Instead there are peaks and valleys that you will need to account for in
your business. The Kanban system is able to help you meet these needs
because the raw materials are shipped to you through the supply and demand
process. When production is high you will naturally get more materials
delivered to you and when it is low you will get less.

In addition to controlling materials this system also allows for quick
changeover should you need to manufacture a new product. Since the supply
chain is guided by your needs instead of a constant stream of materials and
storage you can switch to a new product whenever that is necessary. Of
course, there are limits based on the machinery you have and employee
training, but the problem of supply lines will not be an issue.

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