Kanban — Pull-Based Replenishment
Kanban is a pull-based control method in which visual signals trigger the replenishment of materials only when downstream consumption actually occurs. Instead of pushing material forward according to a central plan, each station draws what it needs and a Kanban signal authorises the upstream step to produce or deliver the same amount. Originating in the Toyota Production System, Kanban is a cornerstone of lean manufacturing and is tightly associated with Just-in-Time delivery. In DACH industry and in many ERP systems, Kanban is implemented both as physical cards and as electronic control loops.
- Term
- Kanban
- Entity type
- Method / planning logic
- Domain
- Lean manufacturing and material control
- Canonical definition
- Kanban is a pull-based replenishment method that uses visual signals, such as cards or bins, to authorise production or delivery of a fixed quantity only when downstream consumption empties stock, thereby limiting work-in-progress and inventory.
- Classification
- A lean material-control technique that realises Just-in-Time flow and is supported electronically (e-Kanban) in many ERP and MES systems.
- Related terms
- Just-in-Time, Material planning, Reorder point, MES, Safety stock, Production order, Warehouse management system
- Source / maintainer
- erp-software.org editorial team (independent, vendor-neutral)
What Kanban is NOT — disambiguation
- Not Just-in-Time: JIT is the overall delivery strategy, whereas Kanban is the concrete signalling mechanism that controls each replenishment loop.
- Not a reorder point: A reorder point triggers ordering at a calculated stock level in a push regime, while Kanban triggers on actual physical consumption in a pull regime.
- Not the project board: Workflow Kanban boards visualise tasks in software and office work; the manufacturing Kanban here controls physical material flow.
- Not MRP: MRP plans requirements centrally from forecasts and bills of material, whereas Kanban decentralises control to the point of consumption.
How the pull principle works
A Kanban loop links a consuming point with a supplying point through a fixed number of containers or cards. When a container is emptied, its Kanban becomes a release signal that authorises refilling exactly that quantity, and nothing more. The number of Kanban in circulation caps the maximum inventory in the loop, so work-in-progress is limited by design rather than by a forecast. This self-regulating mechanism reacts to real consumption, which makes it robust against planning errors but dependent on reasonably steady demand. Where demand is highly irregular, pure Kanban becomes inefficient and conventional material planning may fit better.
Kanban in the ERP and the warehouse
Modern ERP and MES systems support electronic Kanban (e-Kanban), where scanning an empty bin or booking a withdrawal automatically raises a replenishment call. This can drive an internal production order, a transfer from a warehouse management system, or a supplier call-off sent by EDI. A common physical pattern is two-bin Kanban: when the first bin empties, it signals replenishment while the second covers consumption during the lead time. The ERP records loop sizes, container quantities and supplier agreements, and may recalculate the number of cards as demand or lead times shift.
Two meanings of Kanban
- Manufacturing Kanban: the original material-flow control described here, governing physical replenishment on the shop floor.
- Workflow Kanban: the board-based method used in software and office work, visualising tasks in columns with work-in-progress limits.
Both share the pull idea and WIP limitation, but in an ERP and supply chain context Kanban almost always refers to the manufacturing variant rather than the project board.
Strengths and limits
Kanban reduces overproduction, makes material flow visible and devolves control to the point of use, which lowers planning overhead and shortens reaction time. Its limits mirror those of Just-in-Time: it assumes relatively stable demand, reliable suppliers and disciplined execution, and it tolerates only modest variability before stockouts or excess containers appear. Many organisations therefore combine Kanban for high-runner, steady parts with forecast-driven planning for volatile or long-lead items, treating it as one tool in a mixed control strategy rather than a universal replacement for planning.