E kanban vs rop (re-order level planning)

E-KANBAN VS ROP (RE-ORDER LEVEL PLANNING)

WHAT IS E-KANBAN AND BENEFITS OF E-KANBAN

WHAT IS ROP

• ERP SYSTEM MOSTLY USES MRP BASED PLANNING. ROP IS THE ONE SUCH POPULAR METHOD OF PLANNING

• FOR EACH ITEM A MINIMUM STOCK LEVEL IS SET IN THE SYSTEM• WHEN THE ACTUAL ON-HAND INVENTORY REACHES THIS LEVEL OR GOES

BELOW THIS LEVEL THE ITEM WILL BE MARKED AS READY TO ORDER• NEXT TIME WHEN MRP RUNS, A PURCHASE ORDER WILL BE GENERATED• IN THIS WAY, PROCESS IS AUTOMATED TO ENSURE ADEQUATE QUANTITY

IS AVAILABLE

WHEN ROP FAILS

• REORDER PLANNING HEAVILY DEPENDS ON SYSTEM ON-HAND QUANTITY REMAINS UP TO DATE

• BUT IN REAL TIME, IN MOST OF THE CASES WE SEE PHYSICAL QUANTITY NOT MATCHING SYSTEM QUANTITY.

• NEEDS DISCIPLINE TO ENSURE SYSTEM IS UPDATED BEFORE RECEIVE OR ISSUE MATERIAL• BUT MOST OF THE TIME, PHYSICAL ITEM IS ISSUED FIRST OR RECEIVED FIRST THEN

ENTERED INTO THE SYSTEM• SOMETIMES, TRANSACTIONS ARE NOTED DOWN IN PAPER THEN ENTERED INTO THE

SYSTEM• THIS IS WHERE ROP WILL FAIL

WHAT IS KANBAN

• KANBAN DEPENDS ON THE ACTUAL VISUAL PROMPT AND NOT ON THE SYSTEM

• WHEN THE FACTORY SUPERVISOR SEES AND EMPTY BIN OR CONTAINER IN THE SHOP FLOOR, HE WILL TRIGGER THE SIGNAL FOR REPLENISHMENT

• THERE IS NO NEED TO CHECK THE SYSTEM FOR QUANTITY• VERY FACT THE BIN IS EMPTY START THE REORDER PROCESS

TRADITIONAL KANBAN• MANUAL PROCESSING FOR REPLENISHMENT IS DONE• SUPERVISOR PUTS A RED TAG ON THE EMPTY BIN• STORE MANAGER WALKS AROUND AND NOTES DOWN THE BINS WITH

RED TAG. BIN SIZE AND PART NUMBER ARE NOTED DOWN• STORE MANAGER GOES TO THE SYSTEM AND CREATES PURCHASE

ORDERS FOR EMPTY BINS AND SEND IT BY EMAIL OR SNAIL MAIL• THIS PROCESS IS VERY INEFFICIENT AND DEFATS THE PURPOSE

E-KANBAN

• E-KANBAN IS THE MODERN WAY OF DOING• EACH BIN HAS A KANBAN CARD WITH A BARCODE• WHEN THE SUPERVISOR NOTICES THE BIN IS EMPTY, HE USES MOBILE

PHONE TO SCAN THE KANBAN CARD USING AN APP• THIS WILL TRIGGER EMAIL TO SUPPLIER• SUPPLIER SHIPS THE BIN IMMEDIATELY• THIS PROCESS REMOVES THE LAG IN THE SYSTEM AND COMMUNICATION IS

INSTANTANEOUS AND EFFICIENT

SAMPLE E-KANBAN CARD

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