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Production Planning & Control: The Management of

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Integrating Kanban principles in a pharmaceutical

campaign production system
a a a
Jrgen Strohhecker , Rainer Sibbel & Marcel Dick
a
Management Department, Frankfurt School of Finance & Management, Frankfurt,
Germany.
Published online: 03 Jul 2013.

To cite this article: Jrgen Strohhecker, Rainer Sibbel & Marcel Dick (2014) Integrating Kanban principles in a pharmaceutical
campaign production system, Production Planning & Control: The Management of Operations, 25:15, 1247-1263, DOI:
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 Production Planning & Control, 2014
Vol. 25, No. 15, 12471263, http://dx.doi.org/10.1080/09537287.2013.809494

Integrating Kanban principles in a pharmaceutical campaign production system

Jrgen Strohhecker*, Rainer Sibbel and Marcel Dick

Management Department, Frankfurt School of Finance & Management, Frankfurt, Germany

(Received 19 January 2012; nal version received 22 May 2013)

Centralised planned campaign production is the predominant production system in process industries. In this study,
we investigate whether a decentralised Kanban control system, which has proven to offer advantages in other
industries, can be successfully integrated in a campaign production environment. The used research methodology
combines model-based and case-study-based elements. Using the example of a pharmaceutical internal ve-stage
supply chain, we conceive a Kanban concept that integrates campaign formation, develop a discrete-event simulation
model and conduct a range of explorative simulation experiments. We nd that a Kanban campaign production
Downloaded by [Dicle University] at 04:52 05 November 2014

system is not merely feasible but would also be favourable: throughput times can be reduced without increasing
customer lead times. Sensitivity analysis shows that the systems performance is relatively robust to changes in
Kanban key conguration parameters such as number of Kanban cards or campaign size. We conclude by discussing
our ndings and formulating three propositions that might stimulate future research.
Keywords: Kanban; campaign production; batch production; process industry; simulation; decentralised production
control

1. Introduction set-up times and costs, it also results in increased inven-

In process industries, such as the chemical, pharmaceuti-
cal or food industries, a wide variety of transformation
systems are used in praxis (Dennis and Meredith 2000).
In most cases, the production of nal products requires
certain consecutive stages of processing and various
intermediate products (Neumann, Schwindt, and Traut-
mann 2002). Besides continuous transformation types,
which are often referred to as typical for the process
industry, batch production and hybrid forms can often be
found (Dennis 2000; Abdulmalek and Rajgopal 2006).
For low-to-medium volume products, dedicated produc-
tion lines would often be underutilised and therefore
inefcient. As a consequence, these products are typi-
cally manufactured in batch mode using multi-purpose
equipment of limited capacity (Grunow, Gnther, and
Lehmann 2002). A specic characteristic of this type of
production is that set-up times between two batches of
one and the same product are usually considerably
shorter than the set-up process in between the batches of
two different products (Papageorgiou and Pantelides
1996b; Grunow, Gnther, and Lehmann 2002). To
reduce overall total idle times, campaigns can be estab-
lished, which means that several batches of the same
product follow each other immediately (Overfeld and
Witte 1992, Kallrath 2002, Susarla and Karimi 2011).
While campaign formation indeed helps to decrease
tory levels and prolonged total throughput times (TPTs).
When campaign formation is allowed, the complexity
of lot sizing and scheduling problems see e.g. Pinedo
(2005) for an overview or Jans and Degraeve (2008) for
a review is raised. Standard lot-sizing and scheduling
models are deemed inappropriate for solving the com-
plex campaign planning problem (Overfeld and Witte
1992). More advanced models and solution approaches
should be used for example, those discussed by
Susarla and Karimi (2011), Bouchriha, Ouhimmou, and
D'amours (2007), Suerie (2005), Kallrath (2002), or
Papageorgiou and Pantelides (1996a, 1996b). Yet, those
approaches typically require that the production planning
process is organised in a centralised, push-oriented fash-
ion as, for example, realised in MRP, MRP II and
advanced planning systems (Higgins, Le Roy, and Tier-
ney 1996; Stadtler and Kilger 2005; Steger-Jensen et al.
2011). In striving for reduced TPTs, less planning effort
and increased competitiveness, companies using a cam-
paign production approach like the pharmaceutical
enterprise we worked with and used as a case study
nd decentralised, lean, pull-oriented production systems
increasingly attractive (Lyons et al. 2013). Although lean
concepts have traditionally been thought of as most
applicable to the discrete manufacturing industries
(Abdulmalek 2006), plant and supply chain managers

*Corresponding author. Email: j.strohhecker@fs.de

2013 Taylor & Francis

 1248 J. Strohhecker et al.
from the process industry ask whether Kanban principles
can be integrated in a campaign-oriented production
environment and what benet could be expected from
such decentralised production control concepts (e.g.
Mukhopadhyay, Dwivedy, and Kumar 1998).
Developed mostly within Toyota and in cooperation
with its suppliers in the 1950s and 1960s as an important
component of the just-in-time system (Sugimori et al.
1977), the Kanban production system is nowadays well
known and thoroughly implemented in many companies
and industries (Schonberger 2007). While various ver-
sions of Kanban systems are documented (e.g. Sugimori
et al. 1977; Berkley 1992; Bonvik, Couch, and Gershwin
1997; Dallery and Liberopoulos 2000; Allen, Robinson,
and Stewart 2001) and even though these versions some-
times cause debates and contribute to confusion, most of
them are rather similar and differ only in details. The
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core principle common to all variants is the idea of pull
instead of push: Kanban systems substitute traditional
production-driven, centralised, push-oriented planning
techniques with market-driven, decentralised, pull-ori-
ented principles (Hopp and Spearman 2004). The basic
idea behind Kanban is to control work-in-progress inven-
tory by dening supermarkets with a xed maximum
capacity and start the production of a primary or inter-
mediate product only if customer orders or downstream
processes send a production request by forwarding a so-
called Kanban card (Sugimori et al. 1977; Krieg and
Kuhn 2008).
Various research studies provided evidence for a
positive impact of pull production techniques on produc-
tion performance. White, Pearson, and Wilson (1999)
and Fullerton and McWatters (2001), for example, found
such evidence using a survey technique. By applying
models that provide analytical solutions, Spearman and
Zazanis (1992) derived that pull systems have less con-
gestion and are inherently easier to control. Li (2003)
concluded from a simulation study that pull systems
eventually outperform push systems, even in an unfa-
vourable jobshop setting. Billesbach (1994) even
reports on a successful implementation of a Kanban-like
pull system in a process facility. Therefore, Kanban may
represent a promising concept for campaign-producing
companies as well even though rather high changeover
times between two campaigns violate at least one of the
typical Kanban prerequisites (Ohno 1988; Hopp 2004).
Within the Kanban control concept, the aspect of
specifying the number of Kanban cards and the lot size
assigned to each card, which together determine the size
of the supermarkets, has triggered intensive research as
these parameters are crucial for the performance of a
Kanban system (see e.g. Berkley 1992 for reviews, Price,
Gravel, and Nsakanda 1994; Sendil Kumar and Panneer-
selvam 2007). For simple or simplied Kanban models,
analytical procedures have been proposed. There are
several approaches focusing on one-product systems with
a single stage (e.g. Bonvik, Dallery, and Gershwin 2000;
Baynat et al. 2001) and two or multi-stages (e.g. Askin,
Mitwasi, and Goldberg 1993; Krieg and Kuhn 2004).
Less research has been undertaken investigating multi-
product, single-stage Kanban systems (e.g. Davis and
Stubitz 1987; Berkley 1993), and only Krieg and Kuhn
(2008) address Kanban-controlled systems with multiple
products and two stages analytically. For more complex
and realistic Kanban systems, simulation-based
approaches are used to determine the appropriate cong-
uration (e.g. Huang, Rees, and Taylor 1983; Gupta and
Gupta 1989; Berkley 1993; Sita 1998; Sengupta, Sharief,
and Dutta 1999; Li 2003). Simulation approaches are
also used to compare various versions of pull and/or
push policies based on real cases (e.g. Huang, Wang,
and Ip 1998; Yang 2000; Khojasteh-Ghamari 2009).
Yet, to our knowledge, no study exists that examines
the applicability of Kanban in a campaign production
setting with high set-up times and explores the impact of
typical Kanban conguration parameters on production
and supply chain performance. Therefore, the objective
of this paper is two-fold: First, we examine if and how
Kanban control can be integrated in a campaign produc-
tion system; and second, we analyse the impact of the
campaign Kanban conguration on the performance of
the production system by conducting a range of simula-
tion experiments.
The remainder of this paper is organised as follows.
In the next section, we introduce the case and provide
support for the research methodology used, which com-
bines case-study-based and simulation-model-based ele-
ments. Based on the Kanban principles published, we
develop in Section 3, a generic concept of a Kanban pro-
duction system that integrates campaign formation and
apply this concept to the case. Section 4 presents a more
in-depth structural description of the discrete event simu-
lation (DES) model. In Section 5, we provide informa-
tion on the parameterisation of the model and discuss
our validation efforts. Section 6 answers the research
questions and discusses the results. In the concluding
section, we summarise our work and suggest future
research directions.
2. A pharmaceutical production process as case
study
The case study is based on the ve-stage batch produc-
tion process for a pharmaceutical tablet for self-medica-
tion that is produced in medium-level quantities. For the
remainder of the paper, the tablet is referred to as
SMMV (self-medication mid-volume) pharmaceutical.
The case and research site is a multinational companys
plant in Germany, where a large variety of pharmaceuti-
cals are produced and packaged. The plant utilises
 Production Planning & Control
single- and multi-purpose equipment. Campaigns of
production batches are typically formed in production
stages that use multi-purpose equipment. Within the fac-
tory site, a functional layout is used, and the single
stages of the tablets production process are spatially dis-
persed. Therefore, internal (intra-plant) supply chains
(Harland 1996) are dened and dedicated supply chain
managers are installed for the SMMV tablet and all the
other pharmaceutical products to ensure a holistic man-
agement of the production process. The supply chain
managers task is to coordinate the planning and control
process, to identify opportunities for improvement and
initiate improvement processes.
Following the principles of a functional layout, simi-
lar activities and resources are grouped together. Figure 1
illustrates this type of layout schematically for the phar-
maceutical batch production process. Raw materials and
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intermediate products are stored in a central inventory.
Automated guided vehicles carry out all transportation
processes between the functional areas and the inventory.
Figure 1 also claries that SMMV is only one out of
several product lines that is produced in the plant.
In Figure 2, SMMVs production process is illus-
trated as a state task network a concept that was intro-
duced by Kondili, Pantelides, and Sargent (1993) in
order to concisely represent chemical batch production
processes. The starting point of SMMVs production are
two weighing processes, where two or three raw materi-
als are weighed according to the pharmaceutical formula.
Figure 1. Batch production system with functional layout (schematic illustration).
1249
The outputs of these two weighing processes are the
intermediates i1 and i2. For i2, the subsequent granula-
tion process renders the powdery raw materials to a form
that improves the compaction characteristics of the pow-
der. It also facilitates the ow ability and handling (e.g.
Gad 2008). Since the production of one batch i4 requires
one batch i1 and 0.915 batches i3, the granule (i3) has
to be weighed again prior to starting the blending pro-
cess; the excess amount of i3 is transported back to the
i3 inventory. In the process of nal blending, i1 and i3
are mixed to obtain the required homogeneity of the tab-
lets ingredients. The next process produces tablets as
output. Tableting transforms the mixed powder, a non-
coherent solid phase, into the compact tablet (Gad 2008).
Tablets not yet packaged are called bulk ware. The nal
stage of the production process under consideration is
the packaging process. In our case, packaging is a diver-
gent-type production: the tablets are offered in different
packaging sizes for the two countries Germany and Aus-
tria. As Figure 2 indicates, six end-product variants are
the output of the production process.
Non-dedicated equipment is used for the processes
Weighing, Granulation and Blending (see also
Figure 1). The weighing system, the granulator and the
pear-shaped mixer are also utilised for the production of
some other products. Cleaning and set-up times for this
equipment are considerably longer when products are
changed, for example, when one batch i2 with the active
ingredient combination of paracetamol and lactose is
 1250
(1)
r1
Weighing i1
r2
r3
(1) (1)
r4 Weighing i2 Granulation
(1)
r5
rx
x = 611
Raw material
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Figure 2. The production process illustrated as state task network.
granulated after one batch i2 with the ingredients ibupro-
fen and silicon dioxide. In order to reduce total set-up
and cleaning times, campaigns are therefore formed in
these three production stages. However, as a side effect,
waiting times for production orders before this non-dedi-
cated equipment becomes available are increased.
The last two production stages covered in Figures 1
and 2 are tableting and packaging. For tableting, a dedi-
cated tablet press machine is used. As only one type of
tablet (with one and the same active ingredient) is pro-
duced on this dedicated press, cleaning and set-up times
do not depend on the product sequence and campaign
formation is not required. Packaging is done on two
packaging lines. For the end products e1, e2 and e3,
which are produced in rather high volumes for the Ger-
man market, a dedicated line is available. End products
e4, e5 and e6 are packaged for the Austrian market on a
non-dedicated line. As the tablet is offered in a variety
of different packaging sizes for various countries, the
packaging process is order-driven to avoid high inven-
tory levels of nished products: packaging is started only
when a customer order is due. Upon completion of pack-
aging, the products are immediately sent to the customer
and, therefore, they are no longer within the the supply
chain managers scope of responsibilities.
Following the typical approach of campaign-produc-
ing companies, production planning and control in our
case study are based on a central approach. Incoming
customer orders are fed into a central ERP system,
which supports material requirements planning, generates
a master production schedule and creates production
orders for each single stage of production (e.g. Higgins,
Le Roy, and Tierney 1996). Based upon continuously
updated demand forecasts, the central production
planning and control system supports operational
decision-making, considering both cost- and time-
J. Strohhecker et al.
e1
(1)
e2
(1) (1)
Weighing & e3
i3 i4 Tableting i5 Packaging
Blending
(.915) (1) e4
e5
e6
Intermediate
End product
product
oriented objectives simultaneously. However, a modern,
so-called advanced planning system (e.g. Steger-Jensen
et al. 2011) that takes the limited availability of
resources into account and uses true optimisation
techniques is not in place.
SMMVs supply chain manager perceived several
disadvantages in the centralised campaign planning
system. First, as timely delivery is very important and
closely monitored, slack times are included in the vari-
ous jobs standard processing times used for scheduling.
Non-value adding times, such as safety margins before
and after production, replenishment lead times and pro-
cessing times for received goods, were added to the core
production time and inate the TPT. At the same time,
this results in relatively high levels of work in process
inventory. Second, the exibility of the centralised sys-
tem to adjust to uctuating demand was criticised as
poor. And third, maintenance of the master data was
claimed to be laborious and prone to error. In summary,
the supply chain manager criticised the whole central
planning and scheduling system as time consuming,
inexible and bloated resulting in high overhead costs
criticism, which can also be found in the literature (e.g.
Simchi-Levi, Kaminsky, and Simchi-Levi 2008).
In order to identify levers to improve production
performance, a lean manufacturing initiative was set up.
As one part of this initiative, value stream analysis
workshops were run (Rother and Shook 2003; Seth and
Gupta 2005). The goal, according to SMMVs supply
chain manager, was to reduce TPT signicantly
currently about 70 days without putting market supply
at risk. In addition to surfacing some minor improvement
ideas, the value stream analysis workshops identied
one major process innovation for development and
discussion the idea of shifting from the centralised
planning and scheduling concept to a decentralised
 Production Planning & Control
scheme based on the introduction of Kanban principles.
Hoping and expecting that a Kanban campaign produc-
tion system could indeed signicantly improve produc-
tion performance, the future state map for this new
process design was conceived and intensively discussed.
Out of intense discussions in the workshop about the
compatibility of Kanban control and campaign forma-
tion, three important questions arose:
(1) How can Kanban control be introduced in a cam-
paign production system and how should this sys-
tem be designed?
(2) What performance can be expected from such a
Kanban control campaign system?
(3) How sensitively would the new production sys-
tem react to changes in conguration parameters,
such as supermarket and campaign size (CS), and
to changes in the environment, such as demand?
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We address these questions by enhancing the case
study via model support. A model-supported case study
entails, in addition to library research, interviews con-
ducted during a site visit, process documentation and
data analysis, the development of a DES model. Rockart
(2001), for example, discusses that model support has
the favourable consequence in which the analysis of the
model could be used to brighten and challenge insights
emerging from the case study. Moreover, while analysing
the model, further ideas and questions typically arise that
had not surfaced in eld research but could be used to
guide subsequent interviews, additional data collection,
and more focused analyses. The result is an iterative
Supplier
Weighing
1
Weighing
Granulation
2 Blending
Weighed Ingredients Granule
Supermarket Supermarket
Legend: Production KANBAN Card
Material Flow Information Flow
Figure 3. The Kanban system design of the pharmaceutical production process illustrated as a value stream map.
1251
process, where eld research is incorporated into a
model and model results guide further eld research,
leading to relevant and rigorous knowledge (Graham
et al. 1992).
The DES model that emerged from this iterative pro-
cess allowed us to thoroughly test the Kanban campaign
production concept that is developed in the following
section: it facilitated extensive experimentation, including
the application of scatter search optimisation by using
OptQuest (Laguna 2011; Kelton, Sadowski, and Swets
2010), it enabled us to provide profound answers to the
supply chain managers questions.
3. A Kanban campaign production concept
For the ve-stage batch production process shown in
Figures 1 and 2, a decentralised Kanban control concept
was developed adapting multi-product, multi-stage Kan-
ban schemes as, for example, described by Schonberger
(1982), Allen, Robinson, and Stewart (2001) or Baynat,
Buzacott, and Dallery (2002). An overview of the
concept is provided in Figure 3. It is evident that the
functional layout of the production system is preserved.
In the central inventory, Kanban supermarkets with a
maximum size determined by the number of Kanban
cards and the production batch size are installed. As
packaging shall remain directly order-driven, no super-
markets are introduced for packaged products. Once a
customer order is due, one or more packaging orders are
created depending on the amount ordered and the
maximum packaging batch size.
Customer
Final
Tableting Packaging
Blend Tablet Bulk Ware
Supermarket Supermarket
Withdrawal KANBAN Card Customer Order
Supermarket
 1252 J. Strohhecker et al.
For each packaging order, a withdrawal order is sent
to the tablet bulk ware supermarket, where the required
amount of tablets are taken and sent to the packaging
line. Simultaneously, another withdrawal order is sent
from packaging to the central inventory, releasing the
required packaging material, such as patient information
leaets and folding cardboards. When all material and
the tablets are available, packaging can start as soon as
the line becomes idle. As soon as a number of tablets
corresponding to the tableting production batch size are
withdrawn from the bulk ware supermarket, a production
Kanban card (PKC) is sent to the preceding tableting
process, thus releasing an order to reproduce one batch
of tablets. To receive the necessary amount of nal
blend, a withdrawal Kanban card (WKC) is sent to the
blend supermarket. This serves as an authorisation for
the movement of the nal blend from the supermarket to
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the tableting process. Once the blend is provided at the
tableting stage and the machine becomes available, tab-
leting can start.
The withdrawal of nal blend from the supermarket
initiates, in turn, the forwarding of another PKC to the
preceding granulation process and so on. PKC and WKC
both remain with the batch of products until the whole
lot has been consumed by the next process. Then they
travel back to the preceding process, thus creating the
decentralised, self-controlled loops, which are in addi-
tion to the pull principle the essential elements of the
Kanban philosophy (Ohno 1988; Monden 1998).
Kanban cards typically carry three types of informa-
tion: pickup, production and transfer data (Ohno 1988).
A WKC species at a minimum the kind (material or
product number) and quantity of product that a manufac-
turing process requires from an upstream supermarket.
As a central multi-item supermarket is implemented, the
storage area has to be identied as well. In addition to
this, both the preceding and the subsequent processes are
often listed. A PKC species the kind (material or prod-
uct number) and quantity (batch size) of product that a
manufacturing process has to produce. In addition, the
storage area where the output is to be placed also has to
be indicated.
For all of SMMVs production stages, except for the
packaging process, the batch size for the production and
WKCs is predened. It cannot be easily changed because
it has to be registered with the pharmaceutical
authorities, which is a costly and time-consuming pro-
cess. As illustrated in Figure 2, for one batch of tablets
(i5), one batch of blend (i4) is needed. Therefore, the
PKC that is sent from the tablet supermarket to the
tableting process sets the quantity of tablets to be pro-
duced to one batch. Batch sizes in units or kilograms
have to be kept condential. Likewise, the WKC that is
submitted from the tableting process to the blend super-
market shows a quantity of one batch. The quantities for
the remaining upstream PKCs and WKCs are determined
analogously. Although a standard batch size for packag-
ing is dened, customer orders smaller than this standard
batch size are accepted and passed through. Large cus-
tomer orders trigger the creation of more than one pack-
aging order, dividing the amount ordered into standard
packaging batch sizes and a residual. This has the conse-
quence that variable quantities of tablets and packaging
raw materials are withdrawn from the bulk ware super-
market and the inventory, respectively.
Thus far, a generic Kanban concept is adapted to the
case. Yet, to be compatible with the campaign production
environment in our case, the Kanban control system has
to incorporate the formation of campaigns. This is
achieved by introducing a collecting and bundling stage
for both PKCs and WKCs, as shown in Figure 4 for
weighing and granulation as examples. As a result, PKCs
are not sent directly to the preceding production process
in which batches of weighed ingredients are withdrawn
from the supermarket. Instead, the cards are sent to a
campaign formation process, where they are withheld
until the number of cards waiting is greater than or equal
to CS. Only when this condition is met, will the bundle
of cards be sent to the preceding process. If, for exam-
ple, CS is set to two batches for the weighing process,
only bundles of two PKCs are allowed to travel from the
weighed ingredients supermarket to the weighing pro-
cess. One single PKC would have to wait before the
campaign formation stage for another card to arrive.
Although an explicit campaign formation stage can
also be introduced in the withdrawal process, this is only
necessary when campaigns have to be (re)formed for the
transport from a supermarket to a manufacturing process.
Reasons for this could be capacity limitations as well as
the desire to achieve increased utilisation of transporta-
tion capacity. Yet, even when campaigns for WKCs are
not formed explicitly, a succeeding process, which estab-
lishes production campaigns, will automatically pass on
the campaign pattern to the upstream withdrawal
process.
Additionally, one has to adhere to the rule that bun-
dles of Kanban cards have to be processed in successive
WKC
Campaign
Formation
Weighing
Granulation
2
PKC
PKC Campaign
Campaign Formation
Formation
Figure 4. Kanban control with campaign formation.
 Production Planning & Control
order without allowing any unbundling. In other words,
if priority rules other than rst come rst serve are
used to determine the sequence of production or trans-
portation jobs, the bundle of Kanban cards representing
a campaign has to be seen as one job. Nevertheless, set-
up processes might have to be performed between a
jobs single batches.
With the Kanban campaign design outlined above,
the concept of campaign formation can be maintained in
a Kanban control environment. This allows leveraging
the advantage of reduced set-up times between two
batches of the same product. As a result, CS becomes
the third important conguration parameter for the Kan-
ban system, alongside with the traditional parameters,
batch size and supermarket size. When determining
those parameters, one has to make sure that CS for an
intermediate or nished product is always smaller than
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or equal to the size of the supermarket for that product.
Otherwise, the supermarket would not be big enough to
store the complete campaign production output.
4. The DES model
In order to provide a proof of the Kanban campaign pro-
duction concept developed for the focused SMMV sup-
ply chain, a DES model was developed and simulation
experiments were conducted using the simulation soft-
ware Arena (see, e.g. Kelton, Sadowski, and Swets
2010). To keep the model comprehensible and to avoid
the need for enormous amounts of data, not all products
that were produced on the non-dedicated machines were
included in the model. We wanted to focus on the
SMMV products. This, however, required the inclusion
of some mechanisms in our model that could represent
the blocking of jobs that occurs when a production or
transportation job has to wait until the equipment used
for producing non-SMMV products (which are not
explicitly included in the model) becomes available. Our
solution was to include a delay process representing this
waiting time, as shown in Figure 5 for the blending
stage. In the best case, the delay time is zero, meaning
that the mixer is not utilised and is clean when a set of
PKCs arrive. Fast set-up, that is, the abridged set-up in
between batches of the same campaign, and production
can start instantly. In the worst case, the production
process for the product with the biggest CS has just
started, causing the Kanban production to wait rather
long before the equipment becomes available again.
Similar structures were modelled for the weighing and
the granulation stage.
Dedicated equipment is used for tableting and pack-
aging, and this allows us to replace the waiting delay
with explicit seize-delay-release structures (see Figure 6).
Kanban production, along with the associated batches of
tablets, are modelled to wait in a queue until the tablet-
1253
Blending Blending
Blending
Waiting Fast Set-up
Delay
Delay Seize Delay
Release
Figure 5. Process model of the blending stage. The delay types
refer to the Arena modules used in the model.
Note: The delay holds up an entity by the specied amount of
time. A seize delay structure also seizes equipment and
therefore makes it unavailable for other processes. A delay
release structure frees the resource after the entity has been
delayed by the specied amount of time. See also, Kelton,
Sadowski, and Swets (2010) for further information.
ing machine becomes available, and once this occurs, the
machine is occupied by the subsequent set-up, shutdown
and tableting processes. The shutdown process represents
planned and unexpected downtimes of the tableting
machine. Once a batch of tablets is nished, a sample is
drawn and sent for testing to the laboratory. The tablets
themselves are placed in the bulk ware supermarket from
where they can be dispatched via WKC sent from the
succeeding packaging process. Packaging of bulk ware is
allowed to start before the result from the laboratory
analysis has arrived; packaged products are queued until
the nal release. While this practice contributes to
shorten the TPT by allowing parallelisation, it increases
the value of goods at risk. The so-called qualied person
releases the packaged products only if test results and all
quality inspections comply with the specications. If test
results for a batch of tablets do not meet specications
and the qualied person denies nal release, the com-
plete batch has to be destroyed, no matter whether the
batch has been completely or partly, or not at all pack-
aged.
In order to validate the Kanban campaign concept,
we focus on the supply chain performance of the three
pharmaceuticals (e1, e2 and e3) produced for the Ger-
man market. This also allows us to model packaging line
II in a simplied way signicantly to reduce model com-
plexity without deteriorating the relevance and validity
of the results. Therefore, the packaging process illus-
trated in Figure 6 represents only the packaging process
for the German market and can be modelled analogously
to the tableting process.
Technically, the Kanban cards are modelled as enti-
ties with the batch size assigned as attributes (Treadwell
and Herrmann 2005). Supermarkets are represented by
queues of Kanban cards. A PKC is released when the
complete amount of intermediate product associated with
this card is withdrawn. Then, the PKC is sent back to
the preceding process where the production of a new
batch of the product is initiated. At all stages of the
internal supply chain, a many-to-many relationship
 1254 J. Strohhecker et al.

Tableting Tableting Laboratory

Tableting
Set-up Shutdown Testing
Delay Delay Delay
Delay yes
Press Busy Press Busy Press Busy

no Ok?

Shipping
Packaging Packaging Final yes
Packaging Ok?
Set-up Shutdown Release
Delay Delay Delay no
Delay
Line Busy Line Busy Line Busy

Bulk Packed
Ware Products
Destruction Destruction
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Figure 6. Process model of the tableting and packaging stages.

Tablet
Withdrawal Final
Packaging
Material Release
Withdrawal

Customer Packging Order Orders

Orders Orders Backlog filled

Figure 7. Process model of customer order processing.

between orders is allowed, which means, for example,
that a batch of packed products can consist of more than
one batch of tablets and one batch of tablets can be used
for more than one packaging order.
Customer order generation and processing for the
German market (e1 to e3) is modelled as outlined in
Figure 7. Each customer order is represented by an entity
with order size and product type assigned as attributes.
Based on this information, packaging orders are created,
and tablet and packaging material withdrawal orders are
sent to the tablet supermarket and inventory, respectively.
The customer order is put in the order backlog queue,
where it has to wait until all packaging orders are
fullled and the nal release is granted.
Since the non-dedicated packaging line is excluded
from the model, customer orders for the Austrian market
(e4 to e6) are modelled to withdraw the appropriate
amount of tablets from the tablet supermarket (including
a back-order queue) and then cross the boundary of the
model.
5. Model parameterisation and validation
The model was parameterised partly based on statistical
evaluations of data directly derived from the companys
ERP system and partly on expert estimates. For the dis-
tribution tting, the Input Analyzer that is part of the
Arena software package was used. To adequately gener-
ate customer orders, distributions for the order size, the
time between two successive orders and the frequency of
orders per product had to be determined. Table 1 shows
forecasted aggregated customer order data per product
and year. The forecast for the number of orders was
based on the assumption of constant average order sizes.
As SMMV is a mature product, the forecasted total
amount of batches was very close to the actual yearly
production output. This allows for a comparison of the
simulation output measures to actual performance with-
out any interference. The percentage distribution per
product based on the number of orders was fed as dis-
crete distribution into the model and used to determine
the product type.
 Production Planning & Control 1255

Detailed order size data, which could be used for sta-
tistical estimation, was only available for products e1, e2
and e3. However, we were informed that orders for e4,
e5 and e6 have similar sizes as orders for e2 and e3,
while e1s average order size is signicantly larger.
Therefore, we used the available data for e1 to nd the
best tting customer order size distribution for e1. The
data for e2 and e3 were aggregated and used to deter-
mine the distribution for all other products e2 to e6. To
ensure that the simulated orders on average cumulated to
about 157 batches and 65 orders, the best tting distribu-
tion had to be slightly adjusted. Naturally, this negatively
affected the goodness-of-t statistics that is shown in
Table 2 along with the summary statistics for the real
data and the tted distribution eventually used in the
simulation model.1 In addition, based on expert knowl-
edge, the minimum order size was restricted to 0.2 and
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Packaging line set-up and failure times showed no sys-
tematic differences between the products and did not
depend on batch size. Packaging production times, how-
ever, depended on the packaging batch size (PBS) and
differed between products. Therefore, a linear relation-
ship between production time and PBS was modelled
and an error term was included. The slope was deter-
mined by regression (all were signicant at a 0.001
level) and the error distribution was retrieved from tting
the residuals.
Since the tablets are the same for all end-products
and since the tableting process uses constant batch sizes,
set-up, shut-down and production times do not depend
on batch size or product. Using the ERP data available
to nd the best-tting distributions resulted in the deni-
tions compiled in Table 4.
For the weighing, granulation and blending process,

the maximum order size was limited to 6.0.
Production, set-up and failure times for the tableting
and packaging processes could be retrieved from the
ERP system on a per order basis for a time span of 12
months; this data was used to nd the best-tting
distributions. Table 3 compiles the parameterisation used
for the packaging process in the simulation model.
ERP data could not be retrieved. Alternatively, standard
times were used for the set-up and production processes
as indicated in Table 5. Waiting times that represent the
time span until the non-dedicated equipment becomes
available (see also Figure 5) were based partly upon
expert opinions and partly upon data. Since some data
was available on campaign TPTs for the blending stage,

Table 1. Aggregate customer order forecast per product and year.

e1 e2 e3 e4 e5 e6 Sum
Batches 106.24 4.92 20.19 10.76 12.51 2.08 156.70
% 67.8 3.1 12.9 6.9 8.0 1.3 100.0
No. of orders 32 5 12 7 8 1 65
% 49.2 7.7 18.5 10.8 12.3 1.5 100.0

Table 2. Summary statistics on customer order data used to estimate parameters.

Customer order parameter N Mean SD Fitted distribution SSE KSp

Time between arrivalof orders (workdays) 64 4.64 3.23 EXP(4.05) 0.0080 0.010
Order size e1 (batches) 31 3.28 1.51 WEIB(3.3, 2.3) 0.0296 0.037
Order size e2 to e6 (batches) 17 1.45 0.66 NORM(1.4, 0.64) 0.0869 >0.15

Table 3. Summary statistics on packaging process data used to estimate distributions.

Process times N Mean SD Fitted distribution SSE KSp R

Set-up 48 1.65 1.73 0.24 + LOGN(1.18, 0.62) 0.0038 >0.15
Abridged set-upa 48 0.28 0.10 0.1 + LOGN(0.183, 0.0948) 0.0247 >0.15
Shut-down 48 0.46 0.78 DISC(0.4583, 0, 1.0, GAMM(0.62, 1.47)) 0.0128 >0.15
Production 48 28.09 14.89
e1 31 33.59 15.00 9.971PBS + 0.894 + GAMM(1.22, 3.27) 0.0304 >0.15 0.978
e2 5 15.44 8.21 17.113PBS + 0.1152 + 6BETA(0.558, 0.968) 0.0803 >0.15 0.942
e3 12 19.16 7.25 12.993PBS - 2.709 + TRIA(-2.39, 0.835, 1.55) 0.0551 >0.15 0.982

Notes: Process times in hours per batch.

PBS = Packaging batch size.
a
In between campaigns.
 1256 J. Strohhecker et al.

Table 4. Summary statistics on tableting process data used to estimate distributions.

Process times N Mean SD Fitted distribution SSE KSp

Set-up 146 1.68 1.49 25BETA(0.472, 5.95) 0.016 <0.01
Shut-down 146 0.67 1.38 0.001 + EXPO(0.671) 0.0127 <0.01
Production 146 7.61 1.38 6.11 + LOGN(1.5, 0.531) 0.01 0.14

Note: Process times in hours per batch.

Table 5. Parameterisation of the weighing, granulation and nal blending processes.

Resource Process times Judgementally set distribution

a
Weighing system Waiting Exponential(6)
Abridged set upb 0.25
Production 1.75
Granulator Waitinga Exponential(10)
Abridged set upb 0.25
Production 4
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Mixer Waitinga Exponential(13)

Abridged set upb 0.25
Production 4

Notes: Process times in hours per batch.

a
Before non-dedicated equipment.
b
In between campaigns.

this data could be used to approximate the shape of the
distribution. This resulted in the exponential distribution
showing the best t. The distributions mean value was
determined judgementally balancing the various pieces
of information at hand. Table 5 shows the parameter val-
ues that are used in the model.
For weighing, granulation and nal blending, cam-
paigns of three batches for each were enforced. No cam-
paigns were established at the tableting and packaging
stage (meaning that CS is set equal to 1). Transport
times for the batches of intermediate products from the
supermarkets to the production stations and vice versa
were set judgementally to 0.5 h each, which somewhat
simplies the reality. It was also assumed that transport
resources do not impose any capacity restrictions or the
necessity for transport campaign formation in the with-
drawal process. Transport times for the PKCs and WKCs
were neglected, which is equivalent to assuming the
implementation of an electronic Kanban system as, for
example, suggested by Lee-Mortimer (2008) or Kouri,
Salmimaa, and Vilpola (2008). Additionally, based on
other Kanban simulation studies (e.g. Yang 2000), it was
assumed that the weighing process is never starved of
raw materials r1 to r5 and that the packaging process has
an innite supply of auxiliary materials rx, such as
patient information leaets or cardboard boxes.
The simulation was started with empty supermarkets.
This put some stress on the system in the rst one or
two months as customer orders could not be lled by
drawing on intermediate products already stored in the
supermarkets. To eliminate the resulting initial tran-
sience, each simulation was run for 100 workdays before
data over a time span of 780 workdays were collected
(equivalent to approximately three years). All scenarios
were simulated with 50 replications, which provide for
an analysis of the performance measures with half-widths
in the range of 5%.
Model validation is a crucial step in any simulation
study and has attracted intense methodological research
(e.g. Naylor and Finger 1967; Cochran 1987). We con-
ducted a large number of different tests to build as much
condence as possible in the DES model outlined above.
Guided by the schemes of Banks, Carson, and Ii (2010)
and Sterman (2000), we conducted structural, behav-
ioural and statistical tests. Aiming for face validity, we
challenged the boundary of the model by discussing the
model with SMMVs supply chain manager and other
experts. We carefully checked the model structure and
the level of aggregation against all material that had been
made available to us, including our own observations
from the site visits. We carried out many test simulations
and tracked the ow of batches, orders, Kanban cards,
etc. in animation mode. Additionally, extreme condition
tests were performed, such as demand dropping to zero
or CS set beyond supermarket capacity. For all extreme
condition tests, the model behaviour was plausible. For
example, when demand ceased the supermarkets that
were lling up to the allowed maximum level, then
production came to a complete halt. Finally, sensitivity
analysis was employed to check the models face
validity, and results were discussed among us and with
experts.
 Production Planning & Control
Model parameter assumptions were widely based on
the collection of ERP data and statistical analysis. The
assumed statistical model was validated by a goodness-
of-t test and graphical methods. Both probability distri-
butions and judgementally set parameters were also
discussed with experts. However, as the implementation
of the Kanban campaign production system developed
and described above was not yet available, comparing
the model inputoutput transformations to corresponding
transformations for the real system (Banks et al. 2010)
was unfortunately not possible.
6. Results
In order to address the rst research question, namely, if
Kanban control can be successfully integrated in a cam-
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paign production system, an optimal conguration of
the Kanban campaign system has to be determined and
its performance has to be compared to the centralised
production control systems performance. As batch sizes
cannot be easily changed in the pharmaceutical industry
and CS in the rst three stages of SMMVs internal sup-
ply chain should not be changed, the conguration
parameters of the Kanban system are reduced to the
number of PKCs circling in the weighing, granulation,
blending and tableting stages. The scope for setting the
number of cards is even further restricted by the CS: to
avoid a deadlock situation, the number of cards has to
be always set greater than or equal to CS.
To assess a Kanban production systems perfor-
mance, a broad range of measures can be used (e.g.
Yavuz and atir 1995a; Najmi and Makui 2011). Among
the key performance indicators monitored by SMMVs
management, the most important and regularly inspected
measures are the TPT and the production service level,
which measures an average on-time delivery status. In
addition to these two measures, inventory levels are
monitored as well (which we nd in simulation experi-
ments highly and signicantly correlated with TPT
= .879, p < 0.001, N = 25). In the push system that is
actually used, customer orders are entered in the ERP
system with a delivery date assigned well in advance of
the due date. A different logic applies in the pull system.
Customers would place their orders not until the amount
ordered is really needed to meet demand taking a typi-
cal or guaranteed maximum delivery time into account.
Therefore, in a pull environment, a measure such as cus-
tomer order fullment time (COFT) is preferred to an
on-time delivery measure. In focusing on COFT and
TPT, we used a minimum set of performance indicators
to facilitate analysis, which is nevertheless sufciently
balanced to cover typical conicting goals in short-term
detailed production scheduling (Mensch 1972; Gutenberg
1983).
1257
For the comparison between the traditional push
system and the new Kanban based system, the following
benchmark values were set: on average 70 workdays for
TPT and 15 workdays for COFT. While past data served
to set the benchmark for TPT, the COFT benchmark had
to be determined judgementally by drawing on the average
lead time, which was deemed acceptable for the custom-
ers. Based on the experiences with the push-controlled
production, both targets are ambitious and reect the
performance limits of the traditional system. In the model,
COFT is calculated as the time difference between the
arrival time of a customer order and the time the packaged
order is nally released for shipment. TPT is determined
as the sum of the weighing, granulation, blending, tablet-
ing and packaging TPTs.
Since SMMVs management aimed at minimising
TPT without deteriorating COFT, the optimisation task
can be formulated as follows:
Minimise Average TPT
Subject to Average COFT 6 15
Control CSi 6 PKCi, i = 1(weighing) to 4 (tableting)
The OptQuest optimiser that is included in the Arena
software was used to solve this problem (Laguna 2011;
Kelton, Sadowski, and Swets 2010). Figure 8 shows more
than 300 Kanban configurations (that are characterised by
the number of PKCs per production stage), whose
performance measures satisfy the restrictions stated above
with the optimal configuration highlighted. The effi-
ciency frontier of the Kanban campaign production
system with regard to TPT and COFT is also marked in
Figure 8. This line connects the dominant alternatives.
In order to determine the best conguration, the three
efcient alternatives with the lowest average TPT (1) to
(3) along with two additional congurations (4) and (5)
that lie very close to the frontier are further investigated.
Table 6 shows the conguration characteristics and
summary statistics on the two performance measures,
TPT and COFT. While conguration (1) leads to the
lowest mean average TPT, conguration (2) increases
TPT only marginally, while mean average COFT is
Figure 8. Results from the heuristic optimisation process.
 1258 J. Strohhecker et al.

Table 6. Number of PKC and summary statistics (N = 50) of the ve selected congurations.

Conguration 1 2 3 4 5
Number of PKC for production stage Weighing 1 3 3 3 5 4
Weighing 2 3 3 3 3 3
Granulation 4 4 4 4 4
Blending 3 3 3 3 3
Tableting 2 3 4 3 3
Avg TPT Mean 31.25 31.35 33.14 33.54 32.80
SD 1.46 1.68 1.51 1.52 1.71
Half-Widtha 0.42 0.48 0.43 0.43 0.49
Avg COFT Mean 13.38 11.59 10.85 10.93 11.63
SD 2.01 1.61 1.90 1.45 1.71
Half-Widtha 0.57 0.46 0.54 0.41 0.49
a
95% Condence Interval.

Table 7. Independent sample t-test t values for 10 pairs of congurations.

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Conguration 1 2 3 4 5
2 TPT 0.307
COFT 4.926
3 TPT 6.376 5.613
COFT 6.467 2.086
4 TPT 7.685 6.836 1.327
COFT 6.989 2.137 0.234
5 TPT 4.868 4.273 1.066 2.303
COFT 4.681 0.144 2.165 2.217
SE mean TPT 0.206 0.238 0.213 0.215 0.242
COFT 0.284 0.228 0.268 0.241 0.241

, indicates signicance at the 95% and 99% level, respectively.
df = 98, N = 50.

reduced by 1.79 workdays. Ten independent sample Simulation results of conguration (2) show that a Kan-
t-tests were conducted to determine if differences in the ban campaign production system does clearly and signi-
means are statistically signicant (Table 7). cantly reduce average TPT (31.35 workdays) when
While mean average TPT does not signicantly differ compared to the status quo (70 workdays) of centralised
between congurations (1) and (2), mean average COFT push production (t(49) = 162.2, p < .001, r = .998).
is signicantly lower in conguration (2). When compar- While a comparison of simulation-based results to real
ing congurations (2) and (3), TPT increases signi- world measures is probably not completely free of
cantly contradicting the minimisation objective for TPT. biases, we think with all due caution that a perfor-
It has to be noted, though, that COFT is signicantly mance improvement of more than 55% is a relatively
lower in conguration (3) compared to (2), which allows
SMMVs supply chain management to trade-off TPT
against COFT. However, based on the TPT minimisation 80.0 14.0
Avg. TPT Avg. COFT
objective stated above, conguration (2) that also satis- [Workdays] [Workdays]
es the COFT restriction of not more than 15 workdays 70.0 13.0
Avg. COFT [workdays]
Avg. TPT [workdays]

is the optimal solution. The number of Kanban cards in

60.0 12.0
this conguration varies only slightly between three (for
the stages weighing, blending and tableting) and four
50.0 11.0
(for the granulation stage). This low variation corre-
sponds with the outputinput relations that are one or 40.0 10.0
close to one for all stages (see Figure 2).
Based on the simulation results presented in Tables 6 30.0 9.0
and 7, the answer to the rst research question whether O O+1 O+2 O+3 O+4
Kanban configuration
O+5 O+6

Kanban control can be successfully integrated in a

campaign production system is clearly yes, it can. Figure 9. Aggregate Kanban conguration sensitivity analysis.
 Production Planning & Control 1259

Table 8. Aggregate Kanban conguration sensitivity analysis.

Kanban conguration no TSAO TSAO + 1 TSAO + 2 TSAO + 3 TSAO + 4 TSAO + 5 TSAO + 6

TPT (Workdays) 31.35 39.22 46.09 54.34 60.96 67.95 75.87
COFT (Workdays) 11.59 11.84 10.81 10.27 10.59 10.28 10.17
Total supermarket level (batches) 8.40 12.83 17.51 22.30 26.94 31.68 36.67
Tableting machine scheduled utilisation (%) 69.10 69.20 68.50 67.30 68.90 69.50 68.90
Packaging line scheduled utilisation (%) 59.20 60.10 59.30 57.50 59.60 59.40 58.50
Tableting set-up queue (batches) 0.57 1.07 1.40 1.65 1.94 2.17 2.23
Packaging set-up queue (batches) 1.14 1.65 2.15 2.44 2.85 2.99 3.30

Note: All values are mean values from 50 replications.

Table 9. Partial Kanban conguration sensitivity analysis.

Kanban Avg. TPT Avg. COFT Kanban Avg. TPT Avg. COFT
conguration (Workdays) (%) (Workdays) (%) conguration (Workdays) (%) (Workdays) (%)
W1 + 1 4.63 0.41 PSA W1D 9.06 2.49
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W2 + 1 5.47 0.60 PSA W2D 9.54 0.23

G+1 6.30 0.77 PSA GD 28.72 3.09
B+1 6.21 0.90 PSA BD 18.42 0.81
T+1 5.72 6.34 PSA TD 17.04 11.34

strong indication of the advantages of a campaign-inte-
grated pull system over a push system. Without any
doubt, the result serves as a proof of the concept: intro-
ducing Kanban pull principles in a campaign production
system is feasible.
In order to provide additional insight into the
sensitivity of the Kanban campaign production system to
changes in the supermarket sizes, a systematic aggregate
and partial sensitivity analysis was conducted. First,
based on the optimal conguration (2) from Table 6
(referred to as O in Figure 9), the number of PKCs was
incremented repeatedly for all production stages simulta-
neously. Decrementing the number of PKCs would vio-
late the constraint that the number of PKCs always has
to be greater than or equal to that of CS and is therefore
omitted. As Figure 9 illustrates, increasing the number of
PKCs leads to a quite linear increase in TPT, while
COFT tends to decrease slightly (with little oscillations).
Inventory levels and queue length before workstations
with dedicated equipment rise as well (see Table 8). Util-
isations of the tableting machine and packaging line do
not change signicantly. These results are in line with
the ndings presented by Gupta and Gupta (1989),
Yavuz and atir (1995b) and Huang, Wang, and Ip
(1998).
Partial sensitivity analysis provides some insight on
how the system behaves when only one parameter is
changed while all other parameters are kept constant.
Table 9 shows in its left columns the percentage changes
of TPT and COFT, when the number of PKCs in only
one production stage is incremented by one compared to
the optimal conguration. B + 1 indicate that the number
of PKCs in the blending stage is increased to 4 instead
of 3. In the right columns of the table, the number of
PKCs is doubled, that is, W2 D means that 6 PKCs
(compared to 3) are used in weighing stage two. The
results show that the impact of increasing the number of
PKCs on COFT is small and unsystematic except for
the tableting stage where signicant reductions can be
observed. Regarding TPT, the impact of changes in the
middle of the internal supply chain tends to have larger
impacts than variations at the beginning or end.
Relating these ndings to this researchs second
objective, namely, to analyse the impact of changes of
Kanban parameters on the performance of the production
system, we can summarise that the proposed Kanban
campaign system shows a rather stable performance. In
the most sensitive production stage, an increase in the
number of PKCs from 4 to 5 (+ 25%) results in a clearly
less than proportional change in TPT and COFT. Even
doubling the number of PKCs (+ 100%) leads to a rela-
tively moderate rise of maximally 28.72% in TPT (which
highly correlates with inventory).
7. Discussion, limitations and conclusion
To the best of our knowledge, this study is the rst to
investigate the concept of a campaign production system
which uses decentralised, pull-oriented Kanban produc-
tion control principles. Using a case and simulation
model-based approach, we investigated a ve-stage
pharmaceutical production process with functional layout
and addressed both generic and specic aspects of this
internal supply chain. Based on a realistic and
 1260 J. Strohhecker et al.
thoroughly tested DES model, we conducted a range of
simulation experiments, including optimisation, that lead
us to the following propositions:
Proposition 1
Decentralised Kanban production control and campaign
production are not contradictory.
Process industries often struggle with high set-up times
relative to the process time. Campaigns are formed as a
means to keep resource utilisation measures in acceptable
ranges. In such an environment, the usually required fast
set-ups in Kanban systems can be obviously not met.
Therefore, Kanban is often prejudged as inadequate for
campaign production systems. However, our simulation
study shows that an integration of pull principles in a
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production system with high set-up times and campaign
formation is feasible and can be implemented.
Proposition 2
Compared to centralised campaign planning systems that
include safety margins before and after production,
replenishment lead times and goods received processing
times, Kanban campaign production systems show supe-
rior performance.
Simulation results for the Kanban campaign produc-
tion systems conceived for the internal pharmaceutical
supply chain in our case indicate that a broad range of
congurations exist that show a lower TPT (and lower
inventory levels) for acceptable COFT levels of maxi-
mally 15 workdays. While we were not able to model
the centralised planning and control system actually used
in the case (due to reasons of condentiality and, as a
consequence, a lack of information and data) and com-
pare the simulation results for the two systems, we think
that the comparison of simulated performance measures
with actual benchmark gures provides at least some evi-
dence for the advantages of the Kanban campaign pro-
duction system.
Proposition 3
Performance of the Kanban campaign production system
is relatively robust to changes in the conguration.
Aggregate and partial sensitivity analysis showed that
the systems performance is less than proportionally
affected by changes in Kanban conguration parameters.
Therefore, it can be assumed, that the systems congu-
ration can be adapted to specic production situations
without completely deteriorating performance. Neverthe-
less, it is suggested to test adaptations of the Kanban
campaign system to real cases before implementation by
using a simulation model tailored to the specic system.
For companies in the process industry with long set-
up times that have so far refrained from introducing pull
principles, this simulation case study can be seen as an
encouragement to give up their reservations against Kan-
ban. By introducing Kanban control in their supply
chains, campaign-producing industries, such as pharma,
food, biotech, chemical and petrochemical, may also
benet from Kanban production control characteristics
that could not be covered in the simulation study. Spear-
man and Zazanis (1992) show that pull systems are
inherently easier to control, which in a dynamic envi-
ronment leads to better adaptation to changes in
demand or capacity. It also results in reduced planning
efforts and because of the decentralised control mecha-
nism in more responsibility for staff and higher moti-
vation of the employees. Since the use of cards and
boards makes Kanban production control more visible
and transparent, continuous improvement efforts are
facilitated (Li 2003). The importance of high-quality out-
put becomes evident for every worker when, due to
defects, downstream processes are disrupted and products
have to be returned (Ohno 1988). Such experiences
strengthen employees commitment to continuous
improvement. Another major advantage of pull systems
is that these are much more responsive to problems than
push systems. In a pull system, downstream processes
are shut down when upstream processes are defective,
thus preventing the accumulation of inventory on the
plant oor (Cheng and Podolsky 1993).
In addition to the limitation of not having included
all potential advantages of a Kanban campaign produc-
tion system, our study focused on a very specic type of
pharmaceutical production. In order to generalise our
ndings, the performance of a more generic Kanban
campaign production system should be explored in dif-
ferent environments. For example, demand patterns could
be varied, processing times could be changed and the
ratio of set-up times and processing time could be
shifted. Moreover, different layouts could be considered.
It has to be mentioned that by narrowing the purpose of
the model and not including various products in the pro-
duction stages with campaign formation, an advanced
analysis of, for instance, different rules of campaign for-
mation is not possible. However, this limitation could be
easily addressed by extending and rening the DES
model used in this study.
A further limitation of our study is that we did not
include costs and revenues in our analysis. Although the
performance indicators that we have used following
Yavuz and atir (1995a), Najmi and Makui (2011) and
others are clearly linked to prot-based performance
indicators, we cannot claim that a Kanban campaign
production system maximises prot when compared to a
 Production Planning & Control
traditional campaign production system. An answer to
this question is beyond the scope of this paper and could
also be addressed by future research. It also has to be
noted that campaign formation helps to alleviate one of
the prerequisites low set-up times that are discussed
for successfully introducing Kanban control. Other limi-
tations of the Kanban concept as, for instance, discussed
by Ohno (1988) or Monden (1998), have not been
addressed in this study and persist.
The concept of a Kanban-based campaign production
system as presented and investigated in this study has
been proven by simulation experiments to be practical
and perform well. Integrating campaign formation in the
Kanban control logic qualies as a promising way for
industries with rather set-up intensive processes to take
advantage of modern pull-oriented production control.
Downloaded by [Dicle University] at 04:52 05 November 2014
Note
1. SSE = sum of squared errors, KSp = KolmogorovSmirnov
signicance level
Notes on contributors
Jrgen Strohhecker is a professor of
Operations Management and Management
Accounting at Frankfurt School of Finance &
Management, Frankfurt/Main, Germany. He
holds a diploma and PhD from Mannheim
University in Business Administration. His
research interests include production
planning and control concepts, system
dynamics, diffusion and network effects and
the analysis of behavioural dynamic decision-making.
Rainer Sibbel is a professor of International
Health Management at Frankfurt School of
Finance & Management, Frankfurt/Main,
Germany. He holds a diploma in
mathematics and a PhD from the University
of Mnster in Business Administration. In
2004, he got his habilitation in economics
and business administration at University of
Bayreuth. His research interests include
service operations management, production planning and
control concepts and hospital management and controlling.
Marcel Dick works in the Mergers &
Acquisitions team of the Corporate
Development department at Credit Suisse,
Zurich, Switzerland, and is a research
associate at Frankfurt School of Finance &
Management, Frankfurt/Main, Germany. He
holds a Bachelor and Master degree from
Frankfurt School of Finance & Management
in Business Administration and Banking.
His research interests include system dynamics, production
planning, and decision-making in complex organisations.
1261
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