Kanban-based pull systems with advance demand information

Abstract

This paper investigates the benefits of integrating advance demand information (ADI) with Kanban-based pull production and inventory control systems (PICS). Predicting the impact of several PICS design parameters such as Kanban card limits, base stock levels, demand information lead times, and the quality of ADI on performance measures such as throughput, inventory holding costs and customer service levels, presents a complex yet important problem. Since efficient analytical models for performance evaluation studies of these systems are unavailable, simulation experiments are used for the study. The study shows that in many situations, integrating ADI with Kanban-based pull systems provides opportunities for efficiencies that might be significantly greater than that available using pull systems alone. Further, the study also investigates the performance sensitivity of these systems to the quality of information shared and information asymmetry.

Keywords:

• advance demand information
• Kanban
• production and inventory control systems
• simulation

Acknowledgment

This research was funded in part by the National Science Foundation Graduate Research Fellowship.