In my last posts I discussed the basics of CONWIP systems (Constant Work In Progress) and answered some frequently asked questions Part 1 and Part 2 on CONWIP. Overall, CONWIP is a pretty cool alternative to kanban, also establishing a pull system. It has some very valuable advantages, but it also comes with some disadvantages. In this final post of my series on CONWIP, I will shed light on some of these advantages and disadvantages, especially in comparison with kanban, but also with drum-buffer-rope.
If you don’t yet know much about CONWIP, check out the basics of a CONWIP system for an easier understanding of the following discussion.
Advantages of CONWIP
The Big Difference: Number of Variants
Kanban works well with high-quantity low-variety parts. Since every card has a part number permanently associated with the card, the cards always replenish this part number. Of course, this works only if there is a continuous demand for this particular part number. A good example of this would be any made-to-stock parts that will be sold in larger quantities.
On the other hand, if you produce to order, a kanban will have difficulties. If every product you make is unique, then you would need a unique kanban for this product. But since kanban are always assigned a part number, this will be difficult.
CONWIP, on the other hand, has no part number assigned by default to the CONWIP card. Hence, any part number can be assigned (temporarily) to the CONWIP part, even if the part is produced only once. Therefore, CONWIP is well suited for made-to-order parts. However, for made-to-stock production, you need a good production sequence or you may end up in hot water with CONWIP (see further below).
Hybrid System with Kanban Is Quite Possible
Of course, since the cycle of the kanban cards and the cycle of the CONWIP cards is similar, it is easy to imagine a hybrid system (and it has been imagined already a few times). In fact, there are at least two different hybrid systems possible, where both kanban cards with numbers and CONWIP cards without numbers circle through the system.
The first hybrid system has kanbans assigned to the high-runner part types and CONWIP to the low volume exotic parts. Whenever a kanban card comes along, the part number of this kanban is produced. Whenever a CONWIP card comes along, the most urgent part from the backlog of low-volume exotic parts is produced. Both kanban and CONWIP cards wait in a joint queue. The only difference is that just before production, CONWIP parts get assigned a part number from the backlog. This would create a good combination of the advantages of both kanban and CONWIP.
Please be aware that there is also a second type of hybrid CONWIP-kanban system, where both a CONWIP AND a kanban card are attached to the part. In this system, CONWIP has one big loop and kanban has smaller loops within the CONWIP system. However, this would mean that you now have TWO cards attached to each part, a CONWIP and a kanban. This is twice the work, and two times the opportunity for mix-ups. Matching CONWIP cards with kanban cards will be quite a challenge. Overall, my gut feeling tells me to stay away from this second type of hybrid system, since it includes excess work, more possibilities for failures, and not really any big advantage that I can see.
It Is (Also) a Pull System
CONWIP, like kanban and drum-buffer-rope, is also a pull system. As with any pull system, it prevents overloading of the system, prevents overproduction, and generally gives a much more efficient, smooth, and lean production system. As such, a pull system almost always beats a traditional MRP push system from a planning department.
Disadvantages of CONWIP
Does Not Manage Production Sequence Automatically
Kanban has an additional advantage in that it automatically manages your production sequence. If you have enough kanbans of each part type, then the kanban system automatically reproduces what is needed.
CONWIP, on the other hand, needs human input to reproduce the correct products (or, in the case of exotic products, to produce the right products in the first place). This is a reasonable assumption if the people organizing the backlog know what they are doing. However, this is not always the case. Assume you have a system with 50 CONWIP cards. If someone messes up your backlog priority and puts 50 times the same product as a priority, then your entire system is full with this one product. You cannot even produce something else unless you sell one of the other products.
Overall, I think the risk is reasonable and can be managed. However, be aware that the risk of human decisions messing things up is there.
Sensitive to the Bullwhip Effect
One effect of these human decisions is a higher tendency for the bullwhip effect. This effect is a tendency of quantity swings to increase as you go back in the value chain due to human overreaction to demand signals. Since in CONWIP humans decide the priority, they can also overreact.
Uses Quantity, Not Time to Keep Workload Constant
CONWIP – and for that matter, kanban – both normally use the quantity of parts to prevent overloading of the production system. This works well if all parts produced have similar production times. However, if the parts have very different production times, then 500 quick-and-easy parts will have a totally different workload for the production system than 500 hard-as-nuts parts. Again, this problem is shared by both kanban and CONWIP in its usual form (although there are some workarounds).
Measuring the work content by time can prevent this. One method that measures the workload in time by default is drum-buffer-rope, but this has its own disadvantages (see A Critical Look at Goldrath’s Drum-Buffer-Rope Method for details).
A (Bit) More Work
The CONWIP approach includes a separate sorting of the backlog and matching the backlog with the CONWIP cards. This, of course, is extra work that the kanban system does not have. Additionally, these may be more sources of errors. On the other hand, if you have lots of made-to-order or exotic parts, you cannot use kanban. In this case, a CONWIP despite its larger organizational overhead is quite usable.
In sum: If you have high runners, use kanban, since they are easier. If you have lots of exotic parts, use CONWIP. If you have both, use a hybrid system.
Claimed Advantages of CONWIP
Less WIP than Kanban
Spearman claimed that a CONWIP system will have less WIP than a kanban system, since “in a kanban system, there will be generally WIP […] upstream from the bottleneck […]. In a CONWIP system, WIP will tend to collect at the bottleneck.” I respect Hopp and Spearman very much (e.g., for their excellent book Factory Physics and its recent update, Factory Physics for Managers: How Leaders Improve Performance in a Post-Lean Six Sigma World), but here I cannot follow their logic (and bottlenecks are actually one of my key research topics).
If I understood it correctly, this WIP reduction is due to CONWIP having one big loop compared to kanban often having multiple loops in sequence. One of my master students analyzed this in detail and found that having one big loop or multiple smaller loops makes little difference in WIP for the same delivery performance. Therefore I do not believe this supposed advantage. Besides, CONWIP would also benefit from multiple smaller loops depending on the circumstances (see another original research of mine: Ten Rules When to Use a FiFo, When a Supermarket – Part 1 Introduction, and Part 2 The Rules).
Of course, you may assign a different number of kanban or CONWIP cards. However, this depends very much on the details of your system, and it is difficult to tell which one would need less cards and hence less WIP.
Overall, I like the CONWIP system. It seems to be quite useful, especially for made-to-order products. I can also imagine it to be quite suitable as a hybrid in combination with kanban. This concludes my four-post series on CONWIP. I hope this was insightful for you. It definitely was for me, as I am always learning new things by blogging about them (it kind of forces me to look up the details 🙂 ). Now go out and Organize your Industry!
Overview of CONWIP posts in this series
- Basics of CONWIP Systems (Constant Work in Progress)
- Frequently Asked Questions on CONWIP Systems (Constant Work in Progress) – Part 1
- Frequently Asked Questions on CONWIP Systems (Constant Work in Progress) – Part 2
- Advantages and Disadvantages of CONWIP in Comparison with Kanban
- Marek, R. P., Elkins, D. A., Smith, D. R., 2001. Understanding the fundamentals of Kanban and CONWIP pull systems using simulation, in: Winter Simulation Conference 2001; Proceedings of the Winter Simulation Conference 2001, pp. 921–929 vol.2.
- Spearman, M. L., Woodruff, D. L., Hopp, W. J., 1990. CONWIP: a pull alternative to kanban. International Journal of Production Research 28, 879–894.