About Kanban system (Just in Time)

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Just-in-Time (JIT) means to produce, deliver, or purchase

only the materials required,
only in the amounts required,
only when required.

If the JIT system is perfectly implemented, a perfect production system (low inventory, minimum labor, smallest work space, etc.) can be achieved. So, although implementation of the JIT methodology will necessarily differ depending on type of industry, size, or company history, significant improvement will be realized in every situation.

To successfully adopt JIT, you must know what you need, how many, and when. The best way to monitor these three elements of JIT is to ensure that each "next-process" takes only the necessary items, in the necessary quantity and only when required, from the "previous-process". This is called a "Pull" system. When the "previous-process" manufactures only the number of items to be used in the "next-process", it is called "Replenishment Production". JIT is based on these two principles.

If a "Push" system is perfectly designed, it may function as planned. However, every real-life production system suffers problems, large and small, from time to time. That is why a conventional "Push" system, where a given production phase often produces items regardless of the needs of the following production phase , can never achieve Kaizen. Such a system at some point generates excess inventory and demands excess labor, which inevitably increases production costs.

In order to incorporate JIT at a production site, the "Kanban" system is introduced. Kanban means "Sign-board" in Japanese, but the idea is applied by:

Identifying items in process and between processes . Information on the Kanban shows what, when, and how many items the previous-process should supply to the next-process.

Controlling in-process inventory at specified levels . Items not required for the next-process are NOT produced or delivered by the previous-process.

The Kanban is a tool to manage inventory -- not only inventory in-process but also items from outside vendors. It is an integral part of implementing Kaizen through the SGC Production System, supporting JIT by avoiding the waste of over-production. The Kanban also serves as a visible management tool for all production staff.