In the Broadway play Oh, Hello starring John Mulaney and Nick Kroll, Mulaney’s character George St. Geegland is reminiscing about his childhood. He says of his father “You know, looking back, my father was a poor man, but in the end, he gave us the greatest gift of all … a 1997 Toyota Tercel.”
The Tercel has been the butt of many jokes over the years, from George Carlin to the TV show Breaking Bad.
And rightly so. It was never going to win any beauty contests.
Unfortunately for any design-conscious owners, the Tercel was also incredibly reliable.
That “infamous” reliability was the result of another creation of the Toyota company: Kanban.
What Is Kanban?
The Japanese word “Kanban” means “visual signal” or “card.” It’s a system of process management that Toyota created in the late 1940s. The Japanese car manufacturer uncovered what it felt was a more effective way to manage its engineering process by examining how supermarkets managed their stock. While this may seem obvious by today’s standards, at the time the thought of managing the flow of inventory not by your vendor’s supply, but by your own inventory, was little short of revolutionary.
The supermarket suppliers’ “just in time” delivery process led Toyota engineers to rethink their methods and devise a new approach—a Kanban system—that would match inventory with demand and achieve higher levels of quality and throughput.
In the simplest terms, what Toyota created was a better system of communication through visual management.
Toyota line workers still use Kanban to signal steps in their manufacturing process. The system’s highly visual nature allows teams to communicate more easily about what work needs to be done and when. It also standardizes queues and refines processes, which helps to reduce waste and maximize value.
How Kanban Works
We’ve all heard the expression “A picture is worth a thousand words,” and this is the principle behind the effectiveness of Kanban—the idea that the brain processes visual information 60,000 times faster than written information.
Kanban helps you harness this power by using “sticky notes” on a board to create a “picture” of your work. Seeing how the work flows within your team’s process enables you not only to communicate status, but also to create context for the work. Kanban takes information that typically would be communicated via words and turns it into “super digestible” visual bites.
The 4 Core Principles of Kanban
Kanban is gaining traction as a way to smoothly implement agile and lean management methods in tech companies. The visualization that a board presents you with provides an instant and structured overview of your workflow—like an interactive dashboard report. Not only can you see bottlenecks, you can resolve them directly from that board. In effect, it gives you instant process management overview and data access—a very powerful thing.
As much as the Kanban process has been refined since its origins, its core elements have remained rooted in the following principles:
- 1. Visualize work: Creating a visual model of your workflow allows you to observe the flow of work moving through your Kanban system. This process leads to increased communication and collaboration.
- 2. Limit work in process: By limiting how much unfinished work is in process, you can reduce the time it takes an item to travel through the Kanban system. You can also avoid problems caused by task switching and reduce the need to constantly reprioritize items.
- 3. Focus on flow: By using work-in-process limits and developing team-driven policies, you can optimize your Kanban system to improve the flow of work, collect metrics to analyze flow, and get leading indicators of future problems by analyzing the flow of work.
- 4. Continuous improvement: Once in place, your Kanban system becomes the cornerstone for continuous improvement. Teams measure their effectiveness by tracking flow, quality, throughput, lead times, and more. Experiments and analysis can change the system to improve teams’ effectiveness.
Now that we know what Kanban is, next time we will explore how to apply these principles to your business and what benefits can be accrued as a result of its application.
STEVE DUCKWORTH is CEO and co-founder of HarmonyPSA.