Dynamic Simulation of a Kanban Production Inventory System

Abstract

The implementation of the Japanese inventory control system, Kanban, in a production line, reduces Work‐in‐Process (WIP) inventory without affecting production or sales, though there is a point at which the reverse becomes true. The hypothesis that Kanban policy would reduce total WIP inventory without affecting production/sales at all was tested under two environmental conditions, cyclical demand and constant growth demand, by means of a simulated model, and also showed that under cyclical demand, frequent starts and stops in the line due to use of all the Kanban cards will produce eventual growth in all inventories, if not rectified. It is hoped that further research will develop a sufficently comprehensive model to facilitate the implementation of such a materials handling system.