PROJECT REPORT CONTENTS

(Academic Year 2016-17)

Page Content Details

No.
As per Annexure
1 A Project Report On (Title) By (Student Name) for (Company 1
Name)

As per Annexure
2 Y.E.S. Certificate on Letter Head 2

As per Annexure
3 Companys Certificate on Letter Head 3

As per Annexure
4 Declaration by Student 4

As per Annexure
5 Acknowledgement By Student 5

As per Annexure
6 Executive Summary (In Students own words in 1 page) 6

As per Annexure
7 Index 7

[M. B. A. (SPPU) 2015-2017]

 Notes :

1. Font Type : Times New Roman

Font Size : 12

Spacing : 1.5 lines

One side print only (LaserJet / Inkjet)

2.Please do not mention Annexure 1, 2, 3
on right-hand- top of the pages in
the Project Report. This was only for your reference and hence, omit from the Report Script.
 Annexure 1

A PROJECT REPORT

on
“___________________________________________”

Submitted in partial fulfillment of the requirements for the Degree

Certificate of

Masters in Business Management (M.B.A.)

by

_________________________________

(Roll No. ________)

 A Study Conducted for the Company:
_______________________________________

At

International Institute of Management Science

Chinchwad, Pune-411033
 Annexure 2

On Institute letter head

CERTIFICATE

This is to certify that Mr. / Miss

___________________ who is a Bonafide student

of International Institute of Management

Science, Chinchwad, Pune, has worked on

Project titled

______________________________________________
_

____ and has successfully completed the

project work in partial fulfillment of award of

Masters in Business Administration (M.B.A.)

This report is the record of Students own

efforts under our supervision and guidelines.

________________ ________________
Internal Guide Dr. Amod Markale

Director,IIMS,Chinc
hwad

Font Type : Times New Roman

Font Size : 12
Spacing : 1.5 lines
Signatu Annex
re
Name ure 3
Design
ation

COMPAN
Y

LOGO
 CERTIFICATE OF THE COMPANY

BY THE CONCERNED AUTHORITY IN THE ORGANISATION WHERE YOU

HAVE DONE YOUR SUMMER PROJECT (ON COMPANY LETTER HEAD) AND
SIGNED BY THE COMPANY PROJECT GUIDE.

TO WHOMSOEVER IT MAY CONCERN

This is to certify that Mr. / Miss _______________________________,

S/O / D/O ____________________, Student of M.B.A. III semester from
International Institute of Management Science, Pune, has undergone
practical training and undertaken the Project work with us entitled

__________________________________________________________
__

__________________________________________________________
__

during the period ____________________ 2016.

In pursuance of the work, he / she was sincere and punctual and his / her
conduct was found very good.

Date :

Place :
 Annexure 4

DECLARATION (TO BE SIGNED BY THE STUDENT ON PLAIN PAPER A4)

DECLARATION

I, Mr. / Ms. _________________________________ hereby declare that this project

is a record of authentic work carried out by me during the academic year 2016-2017
and has not been submitted to any other University or Institute for the award of any
Degree or Diploma.

Signature of the student

(Name of the Student to be written here)

Font Type : Times New Roman
Font Size : 12

Spacing : 1.5 lines

 Annexure 5

ACKNOWLEDGEMENT

I am deeply indebted to many people for the successful completion of this project.

I would like to take this opportunity and go on record to thank them for their help and support.

I am thankful to the International Institute of Management Science for all the support provided for this

project.

I express my deep sense of gratitude and sincere feelings of obligation to my Project Guide

_______________________ who helped me in overcoming many difficulties and who imparted me the
necessary conceptual knowledge.

I also wish to acknowledge the excellent support of my Company Guide ______________________.

for this work.

I wish to thank all my teachers and friends too, for their helpful inputs, insightful comments, steadfast
love and support.
EXECUTIVE SUMMARY
 Annexure 7

INDEX
Chapter Particulars Page No.

Executive Summary

Nomenclature & List of Abbreviations

1. Company Profile :
a. Vision
b. Mission
c. Logo
d. History of Organization
e. Organization Chart
f. Plant Location/Service Points
g. Product Profile

2. Statement of Problem:
a. Research Question/s

b. Objectives of the Project

3 Theoretical Background of the Topic/Literature Review

4 Research Methodology :
a. Methods Used
b. Sources of Data
c. Data collection tools
d. Sampling
 e. Tools used for Analysis

5 Data Analysis & Interpretation

6 Findings / Observations

7 Learning from the project:

a. Contribution to the organization
b. Learning of the student through the project

8 Scope & Limitations

9 Annexure :
- References
- Bibliography
- Questionnaire (if any)
Chapter No.01
Company Profile
Vision of the Company:-
 Improve the thoughput reporudciblity and accuracy of your inspection process with quick
and repeatale fixturing set-ups using Renishaw vision fixtures.
 Renishaw's vision fixtures offer two unique fixturing solutions designed to fit your specific
vision system or multisensory machine:
 Quick load corner (QLC)
 Interchangeable vision fixture (IVF)

Each system uses an acrylic base plate that allows for the use of backlighting for a clear view of the
part on your vision system.

Mission of the Company:-

Our aim is to provide leading edge technology by encouraging innovation to address our customers
needs.

Renishaw will design, manufacture and supply metrology systems of the highest

 quality and reliability to enable customers worldwide to carry out dimensional

measurements to traceable standards.
 Our product offerings will enhance quality and productivity, and we will strive for
total customer satisfaction through superior customer service.
 Our aim is to provide leading edge technology by encouraging innovation to
address our customers’ needs.
 We are committed to sustained growth through continued investment in product
development and manufacturing methods.
 Renishaw wishes to be recognized collectively and individually as leaders and
contributors in our field and our community.
 We wish to achieve our aims in a way that is caring, open and honest.
 Renishaw is an environmentally conscious and responsible company. We will
 strive to ensure that all aspects of the business have the least harmful effect on the
environment.

History of the Organization:

About Renishaw :

Renishaw is one of the world's leading engineering and scientific technology companies, with
expertise in precision measurement and healthcare. The company supplies products and services
used in applications as diverse as jet engine and wind turbine manufacture, through to dentistry and
brain surgery. It is also a world leader in the field of additive manufacturing (also referred to as
metal 3D printing), where it is the only UK business that designs and makes industrial machines
which ‘print' parts from metal powder.

The Renishaw Group currently has more than 70 offices in 35 countries, with around
4,000 employees worldwide. Around 2,600 people are employed within the UK where the company
carries out the majority of its research and development and its manufacturing.

Renishaw will design, manufacture, and supplymetrologysystems of the highest quality and
reliability to enable customers worldwide to carry out dimensional measurements to traceable
standards. Our product offerings will enhance quality and productivity, and we will strive for total
customer satisfaction through superior customer service.

Our aim is to provide leading edge technology by encouraging innovation to address our customers'
needs. We are committed to sustained growth through continued investment in product
development and manufacturing methods. Renishaw wishes to be recognized collectively and
individually as leaders and contributors in our field and our community. We wish to achieve our
aims in a way that is caring, open, and honest. Renishaw is an environmentally conscious and
responsible company. We will strive to ensure that all aspects of the business have the least harmful
effect on the environment.

Renishaw plcis the world's leading manufacturer of test-probe and measurement equipment forCo-
ordinateMeasuring Machine (CMM) systems offering precision sensitivity up to one-third of a
micron. The company, based in Gloucestershire, England, is structured into six divisions, each
focusing on a specific CMM product applications: Machine tools, Lasers, Calibration, Encoders,
Digitizers, and Spectroscopy. Three additional divisions, Technical Services, Manufacturing
Services, and Corporate Services offer support to the company's product divisions. Renishaw, led
by founders David R. McMurtry, chairman and CEO, and John Deer, deputy chairman--who
together own more than 50 percent of the company's stock--not only leads its market but has long
functioned as its chief pioneer. The company holds a large array of patents, many of which are
under McMurty's name, protecting its products and technologies, and is well known for defending
its patents against infringements. The company operates on a worldwide basis, with one-third of its
sales coming from the United States. The United Kingdom represents 11 percent of sales, and the
company generates more than 35 percent of its revenues in Europe. Japan is another of the
company's major markets, generating 12 percent of its revenues, which topped £125 million in
2001. The company is present in more than 20 countries worldwide.
Chapter no.02
 Statement of Problem
 Objectives of the Study
 Objectives of Study

A Kanban System consists of a set of these cards, with one being allocated for each part being
manufactured, that travel between preceding and subsequent processes
 To Understand the KANBAN process at ____________________
 To study the production process of ________ before implementation of KANBAN system.
 To study the impact of KANBAN system on production after its implementation.
 To study Pull and Push method of KANBAN system.
 Chapter no.03
Theoretical Background of the Topic/Literature Review
THE KANBAN SYSTEM :

Kanban was developed at the Toyota car plants in Japan as a program to smooth the flow of
products throughout the production process. Its aim is to improve system productivity and to
secure operator involvement and participation in achieving this high productivity by providing a
highly visible means to observe the flow of products through the production system and the build-
up of inventory levels within the system. Later it was further developed as a means of production
activity control to achieve the goals of JIT and to manage the operation of just in time production.
Kanban also serves as an information system to monitor and help control the production quantities
at every stage of the manufacturing and assembly process.

What is Kan-ban ?

By this point you may be asking, "What is a Kan-ban?”

A Kan-ban is a card containing all the information required to be done on a product at each stage
along its path to completion and which parts are needed at subsequent processes.

These cards are used to control work-in-progress (W.I.P.), production, and inventory flow. A Kan-
ban System allows a company to use Just-In-Time (J.I.T) Production and Ordering Systems that
allow them to minimize their inventories while still satisfying customer demands.

A Kan-ban System consists of a set of these cards, with one being allocated for each part being
manufactured, that travel between preceding and subsequent processes.

 Kai is an idea of change or the action to correct — Zen means "good“

 kaizen means “change for the better.

  "Kaizen is the means to achieve a corporate strategy, not the strategy." - Masaaki Imai

 Kaizen is a Japanese business philosophy focused on making constant improvements. Its

underlying concept stresses there will always be room for improvement. Fundamentally,
kaizen aims to improve all activities and processes and eliminate waste and excess.

Kanban System

KANBAN AND KANBAN SYSTEM

As a side comment: The term Kanban is quite freely used both as a card and as a system, thus in
this thesis they are differentiated by using kanban, when referring to acard (or other type of kanban
signaling form) and Kanban with a capital K, when a

system or the whole concept is meant. However, at times these might be mixed because of
capitalization rules or other grammatical reasons.

Kanban is a Japanese term meaning card or signal. In manufacturing its purpose is to

signal the demand of components for different stages of production processes and thus operate as
an ‘invisible conveyor’ between them. Kanbans are used to triggerthe

movement, production, or supply of fixed amount or batches of components required for

manufacturing operations. The Kanban system is used to operationalize a pull control, which main
idea is to synchronize the production exactly with real customer demand. It is a vital feature for
lean concept, since the amount of ‘waste’ created during the production processes is minimized.
(Slack et al. 2009: 362.) According to Leanthinking, waste has several forms, such as inefficient
labor time, malfunctioning machines or equipment, overproduction, and high inventory levels. If
something wastes time, money, or resources, it is considered to be a waste for the production
processes and thus needs to be eliminated or at least minimized. (BusinessKnowledgeSource.com
2010).Naufal, Jaffar, Yosoff and Hayati (2012: 1721–1722) define Kanban system as an inventory
stock control system. Its main function is to trigger a signal of a product for production, thus
instructing a correct action needed to proceed according to customer requirements. Kanban system
is not a traditional manufacturing strategy based oncustomer forecast, such as ‘Push System’. On
the contrary, it aims to minimized inventory levels and is actually a type of pull manufacturing
system. By transforming 16

operations from push into pull method, it is possible to prevent high WIP (Work in

Process) inventories, unsynchronized production processes and unnecessary production of excess

stock. Most researchers support a statement suggesting that lead time reduction and manufacturing
excellence could be reached via Kanban systemimplementation. (Naufal et al. 2012: 1721–1722.)
Kanban can also be described

Japanese production principle that utilizes fixed quantity boxes for controlling raw

material procurement via using the empty boxes as ordering signals.

Basically, Kanban is a rather simple parts movement system depending on cards and

boxes or containers. Only these will trigger the movement, order, or production.

required components because an empty storing unit and a Kanban card are signaling

that the specific parts have a quite urgent demand at an informed assembly line. The

Japanese Kanban management system is more complex, and the previously described

‘visual record’ procedure is merely a sub-process. (Olsson 2012)

Olsson (2012) states the following advantages of the Kanban process in production:

· A simple and understandable process

· Provides quick and precise information

· Low costs associated with the transfer of information

· Provides quick response to changes

· Limits over-capacity in processes

· Avoids overproduction

· Minimizes waste

· Control can be maintained

· Delegates responsibility to line workers (Olsson 2012.)

Furthermore, Kanban can be effectively used for continuous improvement of the

manufacturing process and to define the bottlenecks and problems behind them.

Rationalizing the production operations via Kanban will assist in reducing waste and therefore,
supports the Lean concept as well. (Olsson 2012)

The roots of the Kanban system are at Toyota and its assembly line based automotive

manufacturing. The Kanban as a materials management tool of production was createdalready in

the 1950s. More recently during the last thirty years, the Kanban has developed rapidly and is
nowadays a significant part of optimized manufacturing

environment, which has a major effect on competitiveness of the companies even on

global scale. (Olsson 2012.) According to Bergenwall et al. (2012: 382–383), TPS

process design is based on seven key principles and practices:

1. Create continuous process flow to bring problems to the surface.

2. Use pull systems to avoid overproduction.

3. Level out the workload (heijunka).

4. Build a culture of stopping to fix problems, to get quality right the first time.
5. Standardized tasks are the foundation for continuous improvement and employee

empowerment.

6. Use visual control so no problems are hidden.

7. Use only reliable, thoroughly tested technology that servers your people and processes.

Designing Kanban System

Gross and McInnis (2003: 86) state that it is a common misconception to assume, it is enough to
define the size of Kanban and become prepared to implement. In fact there.are four main steps for
successfully implementing the Kanban system. Firstly, one needs to set container quantities,
secondly, develop the design, thirdly, utilize the designand lastly, train the design for employees
involved in the operation. The design itself ought to be considered based on three factors: selection
of the signaling mechanism,definition of the rules for operation and creation of the visual
management plans. All three of these should be defined based on the Kanban viewpoint of the
planned application for the company’s needs. (Gross et al. 2003: 86.) Naufal et al. (2012: 1722)
offer more theoretical viewpoint and suggest developing Kanban system based on a method with
three key elements. Firstly, relevant parameters are gathered, secondly,total number of kanbans is
calculated and lastly, pull mechanism and rule are established (Naufal et al. 2012: 1722).Kanban
calculations define the optimized quantity of kanbans in the planned system.Relevant production
parameters required for these calculations are:

_ Cycle time

_ Withdrawal time

_ Kanban waiting time

_ Replenishment time

_ Part variance

_ Safety stock amount

_ Container capacity

Customer demand per material.

Kanban as a part of JIT manufacturing

The prerequisite of the kanban system to operate

effectively is the implementation of Just in Time

manufacturing principles.

According to Monden [3] the kanban system in the Toyota

production system is supported by the following systems:

• Production smoothing

• Standardization of jobs

• Reduction of setup time

• Improvement activities

• Design of Machine layout

• Autonomation

The kanban system is one of the most visible parts of JIT

manufacturing, but its applicability is directly interlinked with other JIT manufacturing
principles.One of the most influential characteristics of Kanban system is its support to operations
improvement. The kanban controls system is used to limit or cut down work inprogress inventories,
which will reveal the hidden problems

in operations. When the problems are made visible they are solved to improve the operations
further. After the

operations improvement the production batch and batch size are cut down to start the improvement
cycle again.

The promotion of operations improvement is widely considered to be one of the most important
features of a

kanban system.

JUST-IN-TIME (JIT)

There are two main pillars in the LPS created by Toyota shown in the which are JIT and Jidoka.
JIT refers to the production and delivery of what isneeded, when it is needed, in a timely manner
and amount required. It is one of themethods in manufacturing system in inventory control for each
process. JIT may alsoshorten cycle times and provide a relatively high cost reduction. It also has
benefitsrelated to the quality and motivation for employees indirectly. In JIT production, itmeets the
requirements or demand in controlled (card), each movement is pulled

through the system work; according to the requirements at each level or division and the rate of
each stage of goods or parts.JIT production has adopted three methods of operation such as

i. Pull system (Kanban system)

ii. Continuous flow processing

iii. Quick changeover

iv. Takt time planning

Continuous flow processing and shorten the cycle time of manufacturing process will ensure the
consistent of process for the production plant. Kanban systemis a regulatory mechanism to prevent
overproduction and to control the balance ofstock in the manufacturing process. Accurate
information related to the stock can

also be given at any time. The above three principles are a necessary precondition sothat it can
operate effectively to meet Heijunka (balance output). This is one of theproduction planning and
control systems in LPS. JIT emphasizes the concept of zero, the achievement of goals such as zero
defects, zero waiting time, zero

inventories, zero damage, and so forth.This is the key to practice where each process in JIT (if it is
successfully carried out), will enable the company to experience the maximum benefits.

Push and Pull system are two types of production systems, which operateequally in opposite sense
and have their own merits and demerits .Push systemis a conventional system of production. When
a job completes its process in aworkstation, then it is pushed to the next workstation where it
requires furtherprocessing or storing. In this system, the job has a job card and the job card is

transferred stage by stage according to its sequence. In this method, due to

unpredictable changes in demand or production hinder-ness, the job happens to

deviate from its schedule and it causes accumulation of work-in-process inventory.

Hence, inventory planners pessimistically fix the safety stock level on the higher side.
By providing an average or balance level of total production for a cycle of

Kanban is the first step in preparation of JIT. The average number is the basis to

determine the number of machines required, number of products for a cycle or the

amount of raw materials required and labour required for the manufacturing

processes that meet the needs of customers' orders. This is because when the

production is complex and unstable, the setting of same level or average production

per month is not easy If several different model numbers is sent to the assembly

of uncertainty, then the process in each section will be exchanged frequently. It will

be confusing for employees and mistakes will occur, and thus will lead to the

production or assembly process to be delayed or even stopped. Defect on the quality

and supply imbalance will result in increased costs.

Kanban is seen as a pull system, as distinct from the production activity control systems in MRP,
which are regarded as push systems. Both push and pull systems are driven by a master production
schedule (“MPS”), which defines the requirement for individual products, i.e. top-level items in the
bill of materials. This MPS, in turn, is broken down into a detailed plan for items to be
manufactured, assembled, and purchased.

A push system operates by attempting to determine when individual work centers must complete
processing of work orders in order to meet the commitments of the MPS. MRP is considered to be
the classical example of a push system.

A pull system, on the other hand, looks at the manufacturing process from the other end, i.e.
from the perspective of the finished item. The production controller works on the basis that his/her
orders represent firm customer requirements. The time horizon is understandably short. The orders
are broken down from the highest level and the controller checks whether sufficient component
parts are available to produce the finished product. If the components are available, the product is
produced. However, if they are not, components are pulled from the preceding work center. A
similar procedure is followed right back through each production stage and extending all the way
back to include outside vendors. Such a system places great demands on

the production system and vendors. These demands can be met either by having all component
parts in inventory or, alternately, having the capability to respond and make them available in a very
short time (i.e. short lead time).

It should be noted that this type of control mechanism is only applicable in plants involved in
what is termed by many manufacturing systems analysts as repetitive manufacturing. Let us quickly
define repetitive manufacturing and then go on to look at how kanban cards are used.

Repetitive manufacturing is

"the fabrication, machining, assembly and testing of discrete, standard units produced in volume, or
of products assembled in volume from standard options... [it] is characterized by long runs or flows
of parts. The ideal is a direct transfer of parts from one work center to another.
One could argue that the end result of rigorously applying the JIT approach and of using JIT
manufacturing techniques is to move a manufacturing system away from job shop or batch
production to repetitive manufacturing.

Production Activity Control with Kanban

 Under Kanban, only the final assembly line knows the requirements for the end product and, with
this knowledge, it controls what is produced in the total manufacturing system using the following
procedure:

The final assembly line, having received the schedule, proceeds to withdraw the components
necessary, at the times they are required and in the quantities they are required, from the
feeding work centers or subassembly lines. These work centers or subassembly lines
produce in lots just sufficient to replace the lots that have been removed. However, to do
this, they also have to withdraw parts from their respective feeder stations in the quantities
necessary. Thus, a chain reaction is initiated upstream, with work centers only withdrawing
the components that are required at the correct time and in the quantities required.

In this way, the flow of all material is synchronized to the rate at which material is used on the
final assembly line. Amounts of inventory will be very small if a regular pattern exists in the
schedule and if the deliveries are made in small quantities. Thus, Just in Time can be achieved
without the use of controlling work orders for parts at each work center.

The Kanban Card Types:

The most common form of Kanban is believed to be the use of kanban cards. This is

mostly because the founder company of Kanban concept, Toyota, is using kanban cards

as their means of signal in the Toyota Production System. However, there are also

reported disadvantages related to them that cannot be overlooked. The most obvious

ones are losing, misplacing or mismanaging the cards. (Gross et al. 2003: 90.)

Basically, kanban card is a piece of paper, often in a protective sleeve, traveling

attached on or placed inside the kanban material container. The card contains

information of the part number or material code, and the fixed batch or order amount of

the container. It might have additional or more specific information as well. The main
function of the card is to signal the interval and form of action that production or

material handler operators need to take. The aforementioned signal occurs, when the

card is pulled from the container and placed in a cardholder rack or Kaban post to

inform of the consumption of the kanban parts, while the container is being moved to an

assembly line or other type of production work center for usage. The kanban cards in a

cardholder or post are acting as triggers that signal to the In-house production or

Procurement of a demand for a restocked container.

Kanban is the Japanese word for card. Kanbans usually are rectangular paper cards placed in
transparent covers. There are two main types of card in use

1. Withdrawal kanbans Withdrawal kanbans define the quantity that the subsequent process
should withdraw from the preceding work center. Each card circulates between two work
centers only - the user work center for the part in question and the work center that
produces it.
2. Production kanbans Production kanbans define the quantity of the specific part that the
producing work center should manufacture in order to replace those, which have been
removed.
Production or (In-Process)-Kanban
– Provides production instructions for the work center
– Tells the workers exactly the quantity and the type of part to produce
– Used for work centers that produce only one part number or have minimal setups in
spite of multiple part number production
• Rectangular – one piece flow production
• Triangular – for small lot production
Withdrawal-Kanban
– Inter-Process Kanban
• Delivers order for parts from a preceding process
• Specifies quantity and type of parts to deliver from Location A to Location B
– Later replenishment system – kanban are filled from suppliers
finished goods shelf
 – Sequenced withdrawal – supplier sequences parts in reverse order for
truck loading
– Supplier Kanban
• Same as an inter-process Kanban, except it signals conveyance of part from
an outside supplier.
Kanban Card Usage

For a Kanban system to operate effectively, very strict discipline is required. This discipline relates
to the usage of the kanban cards. This requirement for discipline also serves to illustrate the need
for well-documented manufacturing procedures and a well-trained group of operators who are
aware of the procedures and who are motivated to follow them rigorously - a confidence born of
experience of good operator practice. There are five guidelines on the usage of the kanbans, which
help achieve JIT production:

(1) A work center should withdraw only the items which it requires from the preceding work
center in the quantities required and, equally importantly, at the required time. There are a
number of operating principles which support this:
 No removal of material is allowed without an available withdrawal kanban and an
available empty container.
 A withdrawal of more parts than indicated on the withdrawal kanban is not allowed.

(2) A work center or process should only produce those items, which have been removed by
the following work center or process. The freed production kanbans act as a schedule for
the work center. The work center is not allowed to produce greater quantities than
stipulated on the production kanban and the sequence of operations in the work center or
process must follow the sequence in which the production kanbans were freed. As
production is initiated by the final assembly schedule released to the assembly line, the
schedule is passed back through the production system by the release of production
kanbans. Rigorously adhering to the above guidelines results in what is effectively an
invisible conveyor line, constructed and controlled by the flow of kanbans through the
production system.
(3) Defective or substandard items should never be passed to a following work center. This
implies rigorous quality control at each work center or step in the production process.
Allowing defective parts to stay within the production system will greatly upset the flow of
parts at a later stage when the defective part is detected.
 (4) The level of inventories in the production system is dictated by the number of kanbans since
each kanban represents the contents of a standard container. The number of kanbans should
therefore be minimized. By reducing the number of kanbans and the size of each container
the level of inventories is progressively reduced.
(5) The Kanban system is only suitable for dealing with relatively small fluctuations in the
demand pattern in the final assembly line. The system is only relevant to a repetitive
manufacturing situation and large changes in demand cannot be accommodated within it.

If is not possible to arrive at a stable master schedule for the end level items in the bill of materials,
the Kanban system cannot be used. Small fluctuations in the demand can be handled by increasing
the circulation frequency of the kanbans, by increasing overtime, or by hiring temporary operators.
Kanban Boards

The kanban boards are a variation of the kanban cardholder racks, but the signal cards

are replaced by magnets, plastic chips or other suitable objects. Likewise to the cards,

these symbolize a unit of components in inventory. (Gross et al. 2003: 98.) In my opinion, the
kanban board is basically utilized in the considerably similar manner than

playing a board game with a couple of friends and following the rules. However, instead of
throwing a random number with a dice and moving one’s (game) piece accordingly,the inventory
levels are constantly being supervised and the signal objects are moved around the kanban board
based on the container’s physical movement inside the factory. completed work in process on its
specific part number and style rows are shown. The

26

production or movement decisions are made according to the visual management based

on the magnet board and the rules that are followed in operating the kanban board.
Two-Card System

A two-card Kanban system is a hybrid of the Kanban board and the Kanban cardholder

racks. As the name entitles there are two cards assigned for each kanban box, container

or pallet. These inform the material handlers of the storage location inside the factory

and the time the container’s content was produced or received. This form of Kanban is

intended to use in a manufacturing environment that in addition to managing the materials

movement and production scheduling, requires assistance for supervising

product rotation. The two-card system operates simultaneously with a Kanban card rack

and a FIFO (first-in, first-out) box. It is recommended to be utilized for floor stacked

items and even pallet sized items. However, it is especially vital to maintain the system

according to detailed rules and the operators need to be trained thoroughly before
implementation. Figure 6 below demonstrates an example of the possible Kanban cards

that can be operated in a two-card system.

Relationship to Vendors

If the flow of kanban cards back through the production process is followed logically, it is clear
that, ultimately, the incoming raw material and the purchased parts point is reached. This leads to
the question of how the Kanban system might be extended to outside vendors. On the one hand, we
can have large inventories of each part, which are replenished by suppliers at weekly, or perhaps
longer, intervals. However, this defeats one of the essential purposes of JIT, which is to reduce
inventories. On the other hand, we can carry the Kanban process right out and into the vendors'
production systems. This procedure normally involves regular and frequent deliveries from the
vendors and is achieved through the establishment of close cooperation with suppliers and the
sharing of as much information as necessary to help the suppliers' organizations achieve a JIT
system. In effect, it involves establishing a true partnership with trusted suppliers .

Kanban as a Productivity Improvement Technique

If the procedures of Kanban outlined earlier are followed rigorously, the level of work in progress
inventory can be controlled by the number of cards issued for each component part into the system.
This is because each card corresponds to one standard container and, knowing the size of the
container and the number of cards on the floor, a simple calculation gives the inventory level.
Therefore, by reducing the number of cards issued for a particular part, the process inventory level
for that part falls. Eventually, if the levels are reduced low enough, a work center will run out of
material and stop processing. This stops the whole line and major efforts are made to get it running
at the lower level of inventory, by either increasing the number of operators, reducing set-up times,
or redesigning processes.
The thinking is as follows. Unnecessarily high inventory serves to disguise inherent problems and
sources of inefficiency in the production process. Through gradual reduction of inventory levels,
production problems are highlighted and are progressively eliminated.

Assumptions Necessary for Kanban to Work

As indicated above, strict rules must be followed to enable the Kanban system to work efficiently
and effectively. Corresponding to these rules are some fundamental assumptions about the nature of
the manufacturing system, within which the Kanban system operates. We will now briefly revisit
these assumptions.
Since each daily assembly schedule must be very similar to all other daily schedules, it is essential
that it is possible to freeze the master production schedule for a fixed time period, possibly of at
least one month. The final assembly schedule must also be very level and stable. Any major
deviations will cause a ripple effect through the production system causing upstream work centers
to hold larger inventory stocks. What is required ultimately is that the manufacturing system
conform as closely as possible to the repetitive manufacturing system model outlined earlier.
To run a mixed model system effectively requires mixed model capability in all stages of the
production process. Mixed model manufacturing and assembly involves frequent changes and
set-up at the individual work centers. It follows that the set-up times in all work centers be as small
as possible and that the set-up procedures be continuously reviewed to this end. A logical
conclusion from this is the need for balancing between all operations in order to synchronize the
starting and ending of work routines. This ensures that parts are fed to the assembly line at the
same rate as they are consumed.

Implementing Kaizen?

 Kaizen can be implemented in many ways: as an individual, with a small-team approach, in a

boardroom – almost anywhere at any time.
 It's a philosophy of effective improvement and implementation.
 Kaizen can also be implemented in a series of “blitzes" or a more long-term gradual
approach.
 A key part of kaizen is the “continual” aspect of its improvements – this is not a one time
event, but one that must be maintained and encouraged for years to come.
 It is with the steady maintenance of kaizen that true transformations occur.
5 Questions to Ask Before You Attempt to Implement Kanban

My first manufacturing experiences were with two different multi-billion dollar manufacturing
companies who happened to run massive ERP systems meaning we had massive MRP systems
running the shop floor. Sound familiar?

Anyhow, as a young lad out of college I just assumed this was how everyone operated. I also
assumed everyone dealt with the issues of the “system” saying there were 150 widgets on the shop
floor when, in fact, there were only 78.
 1. Do you have the necessary in house expertise? In other words, do you have someone on
your team that has worked with kanban before? If not, I would encourage you to seek help
from outside resources. Hire some help or go visit some companies that are successful and
do some intense benchmarking.
2. Do you even need kanban? Here’s a dirty little secret… kanban is not the end all, be all to
a lean system. In fact, if your company’s information and material flows smoothly from the
moment you take the order until you ship and collect cash… rock on with your bad self!
You probably don’t need kanban. Continue to focus on improving flow and reducing lead-
time.

3. Do you understand what heijunka is and why it’s closely connected to kanban?
Attempting to implement kanban without first leveling and smoothing production is
absolute suicide. It’s like trying to run a marathon with a clamp on your nose and duct tape
over most of your mouth.

4. Is your production process stable? If you are producing defect after defect or your
machines are constantly breaking down you must address this first.

5. How are your changeovers? If you are to level and smooth production via heijunka (see
above) quick and efficient machine changeovers are highly recommended. So start here if
needed.

Now, these are just 5 questions to consider. I am not pretending to assume this list covers
everything… but it does include 5 questions you should definitely contemplate before attempting to
implement kanban into your production system.

Rules of the Kanban

• Never Pass on A Bad Part

• The Parts Are Always Withdrawn From The Prior Process

• Produce Only What Is Necessary To Replenish The Quantity Withdrawn

• Level Load Production, Rapid Changeover, Small Lot Production, Zero Defects

• Kanban Is Used To Fine Tune (Not Provide For Major Changes)

• The Process Must Be Capable Of Producing Good Parts (Rational And Stable)
• Need Efficient Methods Of Transportation, Shortest Routes Possible

• Disciplined Organization

• Nothing Is Made or Transported Without A Kanban.

• Kanban Cards Always Accompany the Parts Themselves.

• The Number of Kanbans Should Decrease over time.

Chapter no.04
Research Methodology
 Chapter no.05
Data Interpretation and Analysis
Chapter no.06
Findings / Observations
Chapter no.07
Learning through project
Chapter no.07
Scope & Limitations