Manufacturing Journalist Tr Cutler Profiles Electronic Kanban

By: Thomas Cutler

In the January 2008 issue of Business Excellence magazine, leading manufacturing journalist, Thomas R. Cutler, described the current nature of Demand Driven Supply Chain and the use of Electronic Kanban by one company. This detailed case study provides insight to the process and functionality of the most important lean tool.

Power Partners' pole type distribution transformers are specifically designed to serve residential overhead distribution loads and are suitable for light commercial loads, industrial lighting, and diversified power applications. Several unsuccessful attempts at lean manufacturing and vendor managed inventory led to excess raw material and WIP (work-in-process.) Power Partners' problems were compounded by inaccurate data in the ERP (enterprise resource planning) system and the inability to locate material within the plant. To address these problems, Power Partners developed a card-based kanban system to signal material replacement actions for many of its materials.

"We started out trying visual systems, such as a simple two-bin system that could be managed by the material handler," explains Ben Ehmcke, director of Supply Chain for Power Partners, Inc. "This system involved marking off an area in receiving where wire baskets or boxes of material could be stored. The material handler on day shift was given a preprinted sheet for that supplier. He would take the sheet and place an 'X' in each box to show the inventory on hand, and then fax it to the supplier. The material would then be delivered at a predetermined time. The next step was to put up kanban boards for several commodities. As material was received, a recyclable card was placed on each standard package quantity. When material was moved from the staging area to WIP, the material handler removed the card and replaced it on the visual board. The board would also show what was on order and when it was received."

The company's manual kanban system was well documented, yet had two basic flaws. Firstly, the company considered material handling to be an entry-level position, and anyone who excelled at it was soon moved to a more skilled position.

It was difficult to maintain the system when there was a constant change of personnel and training was minimal and secondly, there were just too many people handling the material. "We were astounded to find out there were up to thirty-eight different people from just one department that touched the material," notes Ehmcke.

Power Partners needed to find a system where the material handler could perform the basic job function, and still get the information into the ERP system and to the supplier. Power Partners did not have the resources to develop a demand driven supply chain solution internally, even though the company's owners had a business associate that wanted to develop a system for small to medium-sized companies. They had the resources to write the software, but had no knowledge of kanban or lean. After several months of working together, it became evident that the project would take much longer than Power Partners wanted, and was much more complicated than the business associate anticipated. The company started looking for software solutions that could be integrated with their ERP system and grow accordingly. They selected Datacraft Solutions.

About Datacraft Solutions:

Datacraft Solutions (www.datacraftsolutions.com) delivers a revolutionary digital kanban process of automation solutions to lean manufacturers through a secure Internet gateway, eliminating the need to install and maintain a complex IT infrastructure. The company has experienced significant growth in the past twelve months by eliminating complicated, expensive, time-intensive software implementations as well as extensive training regiments and the need for internal support. The Datacraft Solutions' replenishment supply chain digital kanban lean system allows customers access and fully utilize powerful lean benefits immediately for a low, predictable monthly fee; services are scalable so manufacturers can design an appropriate solution.

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