Kanbans in the Kitchen Kanbans are a great way to control the levels of raw materials we have in our organisations. Raw materials can be anything from "widgets" in the factory to pens in the stationary cupboard. The basic theory is that you only have what you need for a limited period and only restock when a predetermined minimum level is reached. A Kanban is the way the need to re- stock is communicated. Recently I was talking with a client about how setting up Kanbans might help them to reduce the amount of stock they carried. After about forty- five minutes of "trigger levels" and "flags" I could see that I was not explaining it at all well. As my friend looked for an escape route I suddenly had a vision of my wife in our kitchen. (I have no idea why!) And then it struck me. We all operate Kanbans everyday when we do the shopping. Check in the cupboards of your kitchen for staple items like baked beans or eggs. In our house we consume at least 300 tins of baked beans a year but we don't buy 300 tins at the start of year and gradually work our way through them. Apart from the fact that most would be out of date by mid- year, it would mean spending a month's shopping money on one item. This would cause a serious cash flow problem. I know that my supplier has hundreds of tins of beans so I know I can get what I want as soon as I need it. So we buy 6 tins at a time. The "trigger" to put "buy 6" on the shopping list is when we have 2 left in the cupboard. If there are three tins in the cupboard, we don't buy any more. The lead time (the time between writing the shopping list and going to the shop) is two days so by the time the next 6 tins are purchased, the cupboard is empty and the beans are delivered straight to the point of use. And so we have a simple Kanban with all the usual data. Maximum level = 6, Re-order level = 2, Lead time = 2 days. During periods of high demand, when friends come to stay for example or when we know supply might be a problem like at Christmas, we adjust the Kanban levels for the short term. If usage goes down it makes no difference to us as we only buy when we are down to the last two. We simply reduce the frequency that we buy beans. If for any reason we find we don't like baked beans anymore the maximum number of tins we will be stuck with is 6. It is slightly different with the cat food though. We can get a discount on the price if we buy full trays at a time from the local pet shop (about 24 tins) so we put this in the garage. We still operate a 4 tin Kanban in the kitchen and when we are down to the last one we go to the garage and get another 4. When the garage stock is down to the last 4 tins we go the pet shop and buy another tray. In order to make Kanbans work however there are some ground rules. Amongst these are: Organisations of all kinds carry huge stocks of all sorts of different raw materials. In the office, this principle can be applied to stocks of paper, envelopes, pens, toner, in fact almost every consumable item there is but be careful to take account of the stock people have secreted away in their desk drawers. In the factory we find little piles of inventory in all sorts of places. The cash trapped in inventory can mount up alarmingly when it is all collected together. I recall one organisation who, when they counted it all up, "found" nearly a million dollars! In today's tough business environment, cash flow can make the difference between success and serious problems and operating simple Kanbans can help to release valuable cash otherwise locked up in raw material stocks. This week's call to action: Collect every single example of one specific item that you can find. This might be compliment slips, window envelopes of a certain size, 3mm bolts... Get people to empty their draws, their work boxes, check window sills, the tops of cupboards and around work areas. The chances are you have far more than you need and you may even find that even more are on order. Simple Kanbans ensure that all the cash spent on buying excess stock is available for more important things.