KANBAN BASED INFORMATION MANAGEMENT

IN ORGANIZATION

TOMASZ ORDYSISKI

Summary
The article presents the applications of Kanban in several fields from its origins
to present expansion to many different domains. The most interesting, according to
information management, is the support of processes / project management. In our
present, unstable time each business initiative (new product, new service, each cus-
tomer inquiry etc.) can be considered unique and usually within a time restraint as
a project. Project management in that case can be considered as a type of process.
Kanban has been successfully applied in software development and is what inspired
the author to propose another adoption: the need for business process visualization
and control.

Keywords: Kanban, Information Management, agile methods

1. Introduction
In our present economy and organization, information has become a crucial asset. The produc-
tion factors such as land, work and capital are less important. A companys success depends on the
information or knowledge base that is kept and used by its employees. Another issue is a change in
business stability in a customer-focused economy there is no stable business. The consumer needs,
expectations or simply style can change at any time. This is reason why companies had to change
the way they operate and become flexible to the marker needs. All of those presented facts make
the entrepreneur think of what can be done to survive and develop in such an unstable time.
One of the potential solutions is to become a kind of virtual company. ICT technology imple-
mented as a tool to make the data acquisition process, data processing, information retrieval or
knowledge management more efficient can improve the situation. The problem, which has appeared
during our lifetime, is the users feeling that all IT applications are very sophisticated and com-
plicated. The information management, knowledge discovery methods sometimes require very deep
IT background to use it efficiently. Sometimes, the data input describing the business process (e.g.
in CRM applications) takes more time than the process itself. The problem here seems to be addi-
tional character of information/knowledge management tools. Additionally, the global success of
social networks (like Facebook) revealed the phenomenon that people want and can efficiently com-
municate the social tool is natural. Of course, the problem is discussing internal business issues
on a public network by employees, but it proves that they just need to communicate. In their day-to-
day work they meet new challenges, a problem that must be solved and is currently not described in
the companys policy or procedures.
The authors proposal is to change the attitude toward todays businesses. We live in unstable
times when each economic initiative (new product, new service, each customer inquiry etc.) can be
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considered unique and usually under a time constraint. These two features can change the vision to
treat day-to-day work more like a project, not a process. What is more, those projects usually involve
several members, so the management and realization should be transparent and available for every
interested employee. There are several techniques for project management, but in this case, mainly
agile groups could be efficiently applied. The goal of the article is to present the Kanban-based
attitude towards information management in project-based initiatives within organizations.

2. Kanban in production processes

The Kanban System has become synonymous with the implementation of the Just in Time
(JIT) manufacturing philosophy, which is designed to control inventory and reduce waste. Begun
back in the 1940s, JIT grew out of Toyota's cultural commitment to continuous improvement to spur
peak performance in its manufacturing processes.
The term Kanban is a Japanese word whose English translation means signboard or visual
signal. Toyota originally used cards attached to different containers (production and withdrawal) to
communicate what materials needed to be replenished (produced) and what materials were to be
used (withdrawn). Today, there are many variations of the Kanban cards, including signboards and
electronic systems.
The Kanban system was constructed to work like a well-timed traffic signal in managing the
flow of traffic to meet the real-time needs of customers by sending clear signals on when to start,
slow down, and stop production. The desired result is to create an efficient system where products
are only replenished when products are consumed further upstream in the process [6].
The essence of the Kanban concept is that a supplier or the warehouse should only deliver com-
ponents to the production line as and when they are needed, so that there is no storage in the pro-
duction area. Within this system, workstations located along production lines only produce/deliver
desired components when they receive a card and an empty container, indicating that more parts
will be needed in production. In case of line interruptions, each workstation will only produce
enough components to fill the container and then stop [16, 112]. In addition, Kanban limits the
amount of inventory in the process by acting as an authorization to produce more inventory. Since
Kanban is a chain process in which orders flow from one process to another, the production or
delivery of components are pulled to the production line in contrast to the traditional forecast ori-
ented method where parts are pushed to the line [16, 113].
The two most common types of Kanban cards used today are:
withdrawal (Conveyance) Kanban,
production Kanban.
The main function of a withdrawal Kanban is to pass the authorization for the movement of
parts from one stage to another. Once it gets the parts from the preceding process and moves them
to the next process it will remain with the parts until the last part has been consumed by the next
process. The withdrawal Kanban then travels back to the preceding process to get parts, thus creating
the cycle; the Kanban layout can be designed many ways in order to display this information. The
primary function of the Kanban production is to release an order to the preceding stage to build the
lot size indicated on the card [4].
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A very quickly changing environment demanding high adaptability asks also for a very flexible
way of ordering materials. Traditional Kanban has certain problems, which can be solved if we use
the electronic way of Kanban. The e-Kanban system gives the company and their suppliers the tools
for meeting these demands by driving value and performance throughout the supply chain. Even
Toyota, the creator of the Kanban system, has adapted e-Kanban system for sending external pulling
signals to distant suppliers [11].
E-Kanban systems can be integrated into enterprise resource planning (ERP) system of any
company. Integrating e-Kanban systems into ERP systems allows for real-time demand signalling
across the supply chain and improved visibility. Data pulled from E-Kanban systems can be used to
optimize inventory levels by better tracking supplier lead and replenishment times.
Electronic Kanban signals carry more information, including delivery location, lot size, and
cycle number and occur in real time. Metrics tracked include: actual cycle time vs. planned cycle
time; consumption patterns; supplier performance for on-time delivery, replenishment accuracy;
when and what to resize; inventory vs. consumption; and inventory aging. Electronic Kanban, by
more closely tying the consumer to the manufacturer, helps drive a process where the sale of a prod-
uct is based on its value rather just its price. The flexibility and responsiveness of Electronic Kanban
promises to drive the factories and distribution of the future to greater efficiencies and profits [3].
The Kanban-based modules are available in enterprise resource planning software such as Ora-
cle's JD Edwards and eBusiness Suite, IFS AB, Infor ERP LN, SAP ERP, Deltek Costpoint or Mi-
crosoft Dynamics AX [2].

3. Kanban in software development will it replace SCRUM?

The advantages of the Kanban attitude were also noticed in project management. Software en-
gineering and development has become one of leading branches of the economy in the 21st century.
However, the project management methods developed in the 20th century do not respond to todays
constantly changing market conditions. The long-term planning of software production, stability and
predictability of users requirements can be considered as past. Most IT projects are shorter than one
year and must support the investors business as fast as possible. The evolution of the project man-
agement method can be briefly presented as follows: the cascade model, spiral model (e.g. RUP),
extreme programming and finally a list of methods commonly named agile [12].

structured adaptive

R X SC KAN- Do whatever
UP P RUM BAN
Figure 1. The set of PM methods
Source: http://www.crisp.se/file-uploads/Kanban-vs-Scrum.pdf
The most popular agile method is Scrum. It is a process framework that has been used to manage
complex product development since the early 1990s. Scrum is not a process or a technique for build-
ing products; rather, it is a framework within which you can employ various processes and tech-
niques. The rules of Scrum bind together the events, roles and artifacts governing the relationships
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and interaction between them. Scrum makes clear the relative efficacy of your product management
and development practices so that you can improve [15, 10].
The fundamental process is simple and at its core is governed by 3 primary roles:
product owners who determine what needs to be built in the next 30 days or less,
development teams that build what is needed in 30 days (or less), and then demonstrate
what they have built. Based on this demonstration, the product owner determines what to
build next;
Scrum masters ensure this process happens as smoothly as possible and continually help
improve the process, the team and the product being created.
Scrum projects make progress in a series of sprints, which are time-boxed iterations no more
than a month long. At the start of a Scrum sprint, team members commit to delivering a number of
features that were listed on the project's Scrum product backlog. At the end of the Scrum sprint,
these features are done - they are coded, tested and integrated into the evolving product or system.
At the end of the sprint, a sprint review is conducted during which the team demonstrates the new
functionality to the product owner and other interested stakeholders who provide feedback that could
influence the next sprint [15].
Three pillars uphold every implementation of empirical process control: transparency, inspec-
tion and adaptation. Significant aspects of the process must be visible to those responsible for the
outcome. Transparency requires those aspects be defined by a common standard so observers share
a common understanding of what is being seen. Adaptation if an inspector determines that one or
more aspects of a process deviate outside the acceptable limits and that the resulting product will be
unacceptable, the process or the material being processed must be adjusted. An adjustment must be
made as soon as possible to minimize further deviation.
Since 2001, several case tools were developed supporting Scrum managed IT projects. How-
ever, the basic and most commonly used tool is just a simple board hanging on the wall in an IT
company that shows the work progress.
Concurrently to Scrum the idea of Kanban was adapted to software development. The pure
assumption of Kaizen, Just in Time and the Toyota Production Process started to be used in a slightly
different production process. At first glance, there is no significant disparity between Scrum and
Kanban, but if we focus on the process or project, the differences are very clearly noticeable [13].
This opinion is common among software developers: we can find Scrum followers (thinking that
this is the only proper way to produce software and denying any Kanban applications in this kind of
process), Kanban innovators (who see only the advantages of Kanban, e.g. work in progress limita-
tions or the transparency of the project and claiming that Kanban is another evolutionary step after
Scrum) and the middle group (aware of the weak and strong sides of both attitudes and using them
in proper situations) [4].
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Ongoing
To do Done
4

Figure 2. Kanban board with WIP limitation

Source: self study.
The authors opinion is consistent with the middle group the proper tool for a specific pro-
ject. According to Kanban origins, the motto of the famous 17th century samurai, Miyamoto Mu-
sashi, can be cited as: do not develop an attachment to any one weapon or any one school of
fighting .
Scrum and Kanban are both highly adaptive, but relatively speaking Scrum is more prescriptive
than Kanban. Scrum gives you more constraints, and thereby leaves fewer options open. For exam-
ple, Scrum prescribes the use of iterations; Kanban does not [1].
The Kanban framework for software development can be presented in 3 main points:
Visualize the workflow;
o Split the work into pieces, write each item on a card and put on the wall
o Use named columns to illustrate where each item is in the workflow.
Limit WIP (Work in Progress) assign explicit limits to how many items may be in pro-
gress at each state;
Measure the lead time (average time to complete one item) and optimize the process to
minimize this [7].
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Table 1. Differences between Scrum and Kanban

Scrum Kanban
Time boxed iterations prescribed Iterations optional. Can have separate ca-
dences for planning, release and process im-
provement.
Can be event-driven instead of iterative.
Team commits to a specific amount of work Commitment optional.
for this iteration.

Uses velocity as default metric for planning Uses lead time as default metric for planning
and process improvement. and process improvement.
Cross-functional teams prescribed Cross-functional teams optional. Specialist
teams allowed.
Items must be broken down so they can be No particular item size is prescribed.
completed within 1 sprint
Burn down chart prescribed No particular type of diagram is prescribed
WIP limited indirectly (via sprint plan) WIP limited directly (per workflow state)
Estimation prescribed Estimation optional
Cannot add items to ongoing iteration. Can add new items whenever capacity is
available
A sprint backlog is owned by one specific A Kanban board may be shared by multiple
team teams or individuals
Prescribes 3 roles (PO/SM/Team). Does not prescribe any roles
A Scrum board is reset between each sprint A Kanban board is persistent
Prescribes a prioritized product backlog Prioritization is optional
Source: http://www.crisp.se/file-uploads/Kanban-vs-Scrum.pdf.
The work in progress (WIP) limits are a mechanism of the process flow control. The number of
tasks in a specific column (stage) can be updated at any moment to make the flow more fluid [9].
The flexibility of Kanban is the strength of this attitude representing the best of agile methods.
Compared to Scrum, the project / process can be monitored as a whole using the same simple tool
like a board hanged on the wall. However, the Scrum shows only one sprint and after it the board is
cleared in Kanban you always know what must be done next. The most important differences are
presented in Table 1.
To summarize the Kanban application in software development and its competitiveness to
SCRUM, the authors experience and knowledge identifies Kanban as a very suitable and intuitive
method to manage and specially control software production. Moreover, the strength of Kanban can
be easily adapted to any other field, where the project is the main type of work organization.
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4. The idea of Kanban-based software for project / process management

As presented in a previous point within the article, Kanban was invented to support supply
management; it then evolved into the currently most popular items such as Just in Time and the
Toyota Production Model to be finally appreciated by the biggest ERP vendors and implemented as
software modules. After that, it was discovered that it is a type of agile method for software devel-
opment. The strength of Kanban is its simplicity and adoptability [14].
If we consider the present work organization, we notice that it is evolving from process to pro-
ject-based. The companies are trying to identify processes, optimize them and then focus on the
constant improvement (TQM). But in many fields, the frontier between a process and project has
almost disappeared. How can we treat a company as process organized when it has to change its
work organization with every customer order to adapt to a constantly changing environment? Maybe
we witness another stage of evolution, which can be called a process framework in project-based
organizations. Everything can be considered as a project. But still the main role turns it into actual,
complete, accessible and useful information delivered at the right time.
Information management has to support the whole project management process in a very ef-
ficient way. In case of structured PM methods like PRINCE2, the documentation of the project must
be complete and accessible for the appropriate project members. However, the size, organization
and time consumed for preparation are relatively long. If we consider agile methods like SCRUM,
the information is delivered and kept for one sprint sometimes losing the holistic view of the
project. Kanban provides the methodology and tools to see the project as a complete set of tasks and
control the task flow at each specified stage. In that case, the natural consequence is to nail im-
portant information to a card and keep it going with it across all stages.

To On- Do Task n
do going ne
Information 1
Information 2
Information 3
Information 4
Information 5

Figure 3. Information management model in Kanban

Source: self study.
The main idea of the article is to present then prepare a set of assumptions concerning a model
of information management in Kanban used in the area of e.g. customer orders, administration pro-
cesses, services or any other field of enterprise, where conditions are so unique that the realization
is an atypical process. The standard features such as security and safety will not be mentioned the
article focuses on the functionality. The analysis identified a set of features, which IM should gen-
erally deliver:
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Versioning the typical work in a project or process is based on documents. During the
flow, the documents can be changed, updated, authorized etc. The PM needs all this kind
of information and it should be kept and delivered on demand.
Filtering the idea of Kanban is less is more. The processes or projects led using this
attitude can be relatively complicated (several cards, several states or even several boards).
To see what is important to the PM team or member, the card should be filterable.
Accessibility in one location whole important for the process / project information should
be kept and available in one place. In case of Kanban, the natural place is a card where the
information can be added, updated but still everything about this task can found in one
place. The feature is strongly connected with versioning.
Project knowledge base each project is unique and except a product gives a set of im-
portant conclusions, which should be collected, evaluated and transferred to other projects
as best practices or do not do.
Integration the ideal situation is the Kanban integration with an existing company system
(two-way). Kanban can be supplied with the necessary data and deliver control signals to
a system, e.g. about the change of an order status. This can be considered as a type of
manager desktop for company control.
The analysis of existing tools identified a gap. ERP modules cover the supply and production
fields. The software development tools vary in functionality depending on price, but the main prob-
lem is its dedication to a software production and limited customization. Within the market there is
a lack of a solution, which would offer pointed above functionality and would be flexible to adopt
it to several fields.

5. Summary
The article presents the applications of Kanban in several fields from its origins to the present
expansion to many different domains. The most interesting, according to information management,
is the support of processes / project management. Present tools based on Kanban are focused mainly
on software production and it is working perfectly. The idea of adopting Kanban to any project
oriented areas of company functioning can create enormous added value. Nowadays enterprises are
or are trying to be process-oriented. That, of course, is a brilliant idea, but if we consider how it
really works we can see the problem processes are identified, optimized and then implemented in
organization as workflows. But are the regular employees aware of the whole process they take part
in? The analyses show that on the battlefield (the operational level) almost nothing has changed.
The regular employees know that they are a part of the process but they cannot see it. The same
situation is at the middle management level we know the process but usually only as a map drawn
in TQM documentation. When we consider inter-organizational initiatives we can read about virtual
organizations (VO) supported by sophisticated IT solutions and find several examples of VO imple-
mentations. But the keyword in this case is sophisticated, which usually equals extremely expen-
sive. What about small and mid-sized enterprises? They cannot afford that kind of tool but are still
operating in process chains connecting several companies of the same size. There is a lack of a tool
that would just visualize, present and control the flow of internal and inter-organizational processes.
The strength of Kanban is the simplicity and transparencies, which in this case is a perfect base for
supporting IM tools.
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ZARZDZANIE INFORMACJ W ORGANIZACJI W OPARCIU O METOD KANBAN

Streszczenie
Artyku prezentuje zastosowania metody Kanban w wielu obszarach od pier-
wotnego do ekspansji uycia w wielu rnych dziedzinach. Z punktu widzenia zarz-
dzania informacj za najbardziej interesujcy uzna naley wsparcie za pomoc tej
metody kwestii zarzdzania projektami / procesami. W obecnych czasach, charaktery-
zujcych si du niestabilnoci kada z inicjatyw biznesowych (nowy produkt, nowa
usuga, obsuga zapytania klienta) posiada cechy unikatowoci oraz ograniczenia w
czasie podobnie jak projekt. Idc dalej tym tokiem mylenia zarzdzanie takowym pro-
jektem mona traktowa jak proces. Metodyka Kanban zostaa z sukcesem zaimple-
mentowana do w dziedzinie produkcji oprogramowania, co zachcio Autora do pod-
jcia prby kolejnego dostosowania tym razem do potrzeb wizualizacji i kontroli
przebiegu procesw biznesowych.

Sowa kluczowe: Kanban, Zarzdzanie Informacj, metody zwinne

Tomasz Ordysi
ski
Uniwersytet Szczeci
ski
ul. Mickiewicza 64 Szczecin
e-mail: [email protected]