JWR’s Introductory Note: This is an update to an article that I wrote for SurvivalBlog in February, 2007. It is part of a series of SurvivalBlog 20th Anniversary update re-posts, in recognition of the fact that the majority of readers did not join us until recent years.
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When I give lectures or do radio interviews, I’m often asked for examples when I mention that “we live in a fragile society.” Here is one prime example: kanban. The kanban or “just in time” inventory control system was developed in Japan, and became popular in America starting in the 1970s. It is now ubiquitous in nearly every industry.
The kanban concept is simple: Through close coordination with subcontractors and piece-part suppliers, a manufacturer can keep its parts inventory small. (Kanban is a key element of “lean manufacturing.”) They only order batches of parts as needed (“just in time”), sometimes ordering as frequently as twice a week.
Companies now hire Six Sigma consultants and Kaizen (“Improvement”) gurus. They buy sophisticated data processing systems. They also used to hire additional purchasing administrators. But now that role is largely filled by Artificial Intelligence (AI) “Expert Systems.” All of these expenses actually save companies money, at the bottom line.Continue reading“Kanban: America’s Ubiquitous “Just in Time” Inventory System: A Fragile House of Cards”

