Kanban Metrics Measurements

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    Steve Dow

    I have just finished carrying out quite a substantial Kanban project -2000 line items (between Stores and each Process area on the line) and was wondering whether any of you knew of any particular useful measurements/metrics that I can use to show an improvement.
    I have considered Inventory held at each process area (reduction) as a percentage & cost.  Also, the reduction in line stoppages etc.  It seems to labour intensive to measure time from trigger to stores and replenishment.
    Any experience or tips you could pass on would be greatly received.


    Zack Guthrie

    Question: how did you calculate Kanbans if you don’t know replenishment time? (time from trigger to stores and replenishment).  That is, how are you going to ensure that you don’t have a stock-out situation if you don’t know replenishment time?  (The Kanban lot size is never less than average daily demand multiplied by the replenishment time).
    To answer your question, a very important metric is process lead-time improvements (to your internal/external customers) – since you are moving from push to pull (and smaller lot sizes) you should see improvements in lead-time.  You don’t need to calculate LT savings for each one – just look at your highest volume parts and, using the routing/process plan, and see how much time you’ve shaved off your processing time.
    Another intangible measure is simplified scheduling.  Since you’ve already calculated ADD, etc. you have the system pre-stocked with appropriate levels of inventory; planners don’t have to ‘chase’ in-process materials, etc. 
    There are many variations in Kanban calculations, but here’s what I use:
    ADD = Average daily demandR = Replenishment time in daysReplenishment Amount = ADD*RSafety Factor (SF) = (Highest demand – ADD)/ADD Total Qty = Replen. Amt + SF Stock# Kanbans = Total Qty / Container Size
    Additionally, if you have ‘service level’ information from your suppliers it can also be included and replace SF.
    Service Factor Factor Used 80% 0.8490% 1.2895% 1.6597% 1.9699% 2.33100% 3.08
    Service Amount (SA) = service level factor * supply std. dev. (replaces SF if std. dev. Is available from supplier deliveries)# Kanbans lots = (ADD * R * (1+SF) + SA) / standard container qty
    Hope that helps –  good luck!
    Zack Guthrie



    Hai steave
    i would like to know the details of KANBAN system can you pl send me some of your formates and details and method to understand the need and implementation guidelines.
    You can send the details through [email protected]

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