There are dozens of tools and techniques used by organizations to support their continuous improvement efforts. The most successful companies I've seen pick a few methodologies that work well for them and execute them consistently. If improvement work slows down or a new challenge arises, they experiment with another technique. Whether you are just getting started with structured improvement or if your practice is mature, you might consider adding a tool known as the Kanban methodology. This post will cover the meaning of Kanban and a few of its key advantages.
We tend to think of just-in-time manufacturing as a relatively new concept. Dell builds your PC when you order it, but does it quickly, so you are satisfied with the speed of delivery. Plus, Dell never has excess PC inventory on its hands. However, the idea is not new at all. In the 1940s, Toyota began applying the principle to its production lines after taking a lesson from an unexpected place: the grocery store.
The word kanban means signboard or billboard in Japanese.
When you go to the grocery store, it's rare to find an empty shelf. (Pandemic-related supply chain disruption, notwithstanding.) If you do find items missing, the shelves don’t stay empty for long. The reason is that the store has both the inventory on the shelf and some inventory in its own on-site warehouse.
While shopkeepers know that the store will lose money if they are out of an item that a customer wants to buy, they don’t want to stock more of a commodity than will be sold in a short enough time to ensure that the items are fresh. They also don’t want to tie up capital in inventory that is just sitting around. So, when a shelf is depleted, it is refilled from the on-site inventory, and only then are new items ordered from the manufacturer to replace the warehouse products.
Toyota realized that the same management technique would work for items needed on its manufacturing floor. They further enhanced the idea by adding Kanban cards, which served as a visual signal of the state of inventory. The approach can be applied to any business process with work in progress, so its use is not limited to the manufacturing of hard goods.
Given the origin of the word, it isn’t surprising that the first principle of Kanban is about visualization. Unlike some business process approaches, Kanban doesn’t prescribe a workflow; it only requires that work in progress be managed in a way that can easily be visualized. To begin a Kanban improvement, it is important to visually map the process as it currently exists.
What I've observed repeatedly from visualizing workflows:
Visualization continues once Kanban is implemented and communicates the state of projects, processes, and inventory.
The goal of Kanban is to move every bit of work efficiently from beginning to end with as little waste and lag as possible. This requires limiting the amount of work in the pipeline to what can reasonably be managed at a given time. This is where I see the most resistance from teams initially, but it's also where I witness the most dramatic improvements. Work-in-progress (WIP) limits prevent system overload:
Like in the grocery store, inventory is pulled from the backroom to the shelf only when customer demand makes space for it. The Kanban approach moves work from one stage to the next only when it is pulled through by “customer” demand. Work is never pushed forward, so bottlenecks are avoided.
When the first two principles of Kanban are in place, workflows flow freely. Your attention, therefore, should be focused on any interruptions in flow, which represent opportunities for additional visualization and process improvement. Flow optimization involves monitoring and improving how work moves through your system:
Kanban is something that is never “finished.” The approach requires constant monitoring and analysis to look for the next best way to improve. Conditions, resources, and customer demands change over time, so it is essential to assess flow and look for blockers or friction that teams can remove.
With this kanban definition in mind, the benefits of the technique become clear. Including:
Kanban is a continuous flow method without fixed time periods, while Scrum uses fixed sprints (usually 2-4 weeks). Kanban focuses on optimizing flow and can be implemented alongside Scrum in a "Scrumban" approach.
Absolutely. Kanban principles apply to any work that moves through multiple stages - software development, marketing campaigns, healthcare processes, legal workflows, and professional services all benefit from Kanban implementation.
Create clear escalation policies for urgent work, potentially including:
Conduct weekly operational reviews to address immediate flow issues and monthly retrospectives to evaluate and adjust the system itself. Major process changes should be implemented gradually and measured for effectiveness.