The Waste That Restrains
By Tom McBride
Our last issue discussed the urgent need for many
businesses to go through a lean transformation to strengthen their
competitiveness. A critical step is
identifying the waste that needs to be eliminated.
This article continues the theme by describing the most common forms of
waste found in organizations.
Waste can be defined as the use of any equipment,
materials, space, or activity that does not add value to a product or service.
A value-added activity is defined as something for which a
customer would be willing to pay. Anything
that is not clearly value-added should be scrutinized as a suspect for waste.
Many estimates indicate that organizations harbor a staggering 85-95% waste when
using “perfection” as the benchmark.
The following list of eight wastes is adapted from the
works of Taiichi Ohno of Toyota and other authors.
opportunities Sales, profits, or other opportunities lost
due to ineffectiveness or working on the wrong things often overshadow all
other wastes. A day invested to
ensure you are offering the right products at competitive prices will
usually do more to strengthen your business than a day spent cutting costs.
Producing something before the customer wants it is often the
next largest waste. It sets up
conditions that cause many of the other wastes and may result in obsolete
People often lose time when waiting for something to happen.
Examples would be when something goes wrong upstream, when there are
bottlenecks in a process, or when people wait for a piece of equipment to
finish its task.
Excess movement of an item or material that supports the
production of a good or service is waste.
Causes include double handling associated with storage, as well as
poor layouts, scheduling, coordination, housekeeping, or organization.
Even work that is usually considered “value-added” may
contain waste. Although processing
usually represents a fraction of the total cost, many make the mistake of
focusing on this area first.
much inventory complicates production, absorbs valuable resources, hides
real problems, and extends deliveries.
In looking for waste we need to think beyond the traditional
definition of inventory and include all of the material or work required to
produce any product or service.
often go through motions that do not add value. Workspace disorganization, poor factory or office layouts,
and bad habits can accentuate this waste.
defects Defects found
anywhere in the process disrupt flow, cause delays, add cost, and reduce
capacity. Worse yet, defects
found by the customer damage loyalty.
Future articles will present some methods of finding
and eliminating waste and describe how an organization can initiate a