Determining the number of kanbans: a step toward non-stock-production

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Abstract
Just-in-time (JIT) production is a philosophy that calls for reducing work-in-process (WIP) inventory to aid process improvement and reduce process variability. In some cases, JIT production has been misinterpreted as a method that would lead to zero or minimal WIP with a lot size of one. There are no models or theories to achieve the JIT goal, i.e. non-stock-production (NSP), and, in particular, to help determine when and where to maintain this minimal inventory. A kanban system acts as the nerve of a JIT production system whose functions are to direct materials just-in-time to workstations in stages of manufacturing, and to pass information as to what and how much to produce. Indeed, the number of kanbans between two adjacent workstations decides the inventory level of that pair of workstations. With the objective of minimizing WIP inventory level, one model dealing with three cases of production configuration is developed for deciding the optimum number of kanbans. The model is then solved using a Markov process approach which considers the demand of finished products as the departure rate and the production rates of stations as arrival rate. In this paper, the model and solution procedure are illustrated with a numerical example.