Kanban and ERP

I was working at a plant recently.  While I was talking with one of the managers someone brought him a batch of bad parts they just found at the line from a supplier.  He was lamenting what a pain this was to get it adjusted in their ERP system, get new parts to replace them before the system would shut the line down due to an inventory mismatch where they scanned at the end of the line.  It also require a lot of transactions to make sure everything in the BOM properly aligned.

Their operation is no where near the size and complexity of a Toyota plant and so he quipped, how in the heck do they keep things rolling smoothly?

This was a decommissioned card so no shortages were incurred!

This question really highlighted an generally unseen and under promoted aspect to Toyota’s kanban system.  The kanban system is the internal line replenishment system.  Every bin, rack, container, pallet has a kanban card.  The card has information about what part is associated with it, a description, a quantity where it is in the warehouse and where its end use location is along with other pertinent information.

As a new container of parts is used, the kanban card is removed and placed in one of several collection points along the line.  Then as material handling delivers parts, they collect the kanban cards which create the order for the next delivery.  When the cards are taken back to the warehouse they are first dropped at a scanning station where the barcodes on each card are scanned.  This is the point where data flows into the ERP system monitoring usage and triggering reorders to the suppliers. 

Then if there’s a batch of bad parts at the line, the Team Member informs their Team Leader, pulls the next batch, moves the kanban card to the collection point and moves on.  An extra batch of parts will be delivered in the round and the inventory level is maintained.  The extra kanban card when scanned can raise a flag for the extra usage relative to other parts and the Team Leader will fill out the paperwork explaining the issue and get the parts delivered so they can be reviewed by quality or whoever else needs to be involved.  The kanban cards enable the system to keep delivering parts to the line and buffers production from the rigid rules the ERP system imposes.