First listed various formulations of calculating kanban quantities in July 2006. Here are a few more …
9. wmarhel at Elsmar Cove writes …
The formula for calculating the number of kanban cards in a system for a particular product is:
(Daily Demand x (Run Frequency + Lead Time + Safety Time)) / Container Capacity
Where:
Daily Demand = Customer Consumption expressed as # of units
Run Frequency = Frequency which you decide to set-up and produce that item. This is expressed as a unit of time. For a five day work week, running the product every day would equal (1), every third day would equal (3), etc.
Lead Time = Manufacturing lead time (processing time + Set-up time + queue time) + lead time for kanban retrieval expressed as a unit of time.
Safety Time = Allowance for variations in demand and supply, also expressed as a unit of time. Keep as low as possible.
Container Capacity = Number of units per container (# of units in a container is always the same number).
10. World Class Manufacturing has an on-line Kanban Size Calculator that uses the following formula:
Total Required Inventory (TRI) = Weekly Part Usage * Lead-time * Number of locations for stock
# Kanban = TRI / Container Capacity
11. Oracle uses
By default, the standard calculation is:
(C – 1) * S = D * L
where:
- C is the number of kanban cards
- S is the kanban size
- D is the average daily demand
- L is the lead time (in days) to replenish one kanban
12. SAP says …
K = ((RT * AC)/CONT) * (SF + C)
where
- K numbers of Kanban
- CONT contents per Kanban
- RT replenishment lead time per Kanban
- AC average consumption per time
- SF safety factor
- C constant (default 1)
Had dinner last night with Richard Zuber, Lean Six Sigma Master Black Belt at Honeywell. He was a student of mine some years ago at AlliedSignal before the Honeywell merger. Richard posed a question as to why so many organizations that have mastered demand smoothing and flow eventually revert back to month end madness, chaos and noise. He’s seen good applications of heijunka and demand segmentation fail. Why?
New trade agreements, shifting customer and supplier locations, changing labor and freight rates, fuel costs, new products and markets all conspire to make your current logistic network obsolete. Gone are the days when a warehouse distribution network would be reconfigured every ten years or so. Today aggressive supply chain executives keep a constant eye on the architecture.
