The Benefits of using RFID or Barcode for E-Kanban or Automatic Replenishment

Electronic Kanban (E-Kanban) is a messaging system that uses a mix of technology to trigger the movement of components and materials within a manufacturing facility. Electronic Kanban differs from traditional Kanban in that it uses technology to replace traditional elements, such as Kanban cards with barcodes and RFID.

A typical electronic Kanban system will see inventory marked with barcodes or RFID. The inventory is scanned at various steps in the manufacturing process to signal usage levels that are sent back to an ERP system for replenishment. This method ensures a constant flow of material while keeping inventories to a minimum.

An additional benefit of E-Kanban is the integration of outside suppliers through an ERP system. By relaying this information, the entire supply chain can be optimized for Just-In-Time inventory flow.

Benefits include:

  1. Reduce inventory levels, carrying cost
  2. Savings in material transfer, labor cost
  3. Increase in inventory replenishment, decrease down time and line stoppage due to stock out

Automatic replenishment, Ekanban, and end-to-end pull, are all names that describe a system in which parts and sub-components are automatically replenished in a manufacturing environment. While most manufacturing organizations have some form of replenishment system in place, I have found that just about every company does it differently. While some are more effective than others, the ones that truly want to automate the process utilize automatic identification.

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