Lean Waste – How to Optimize Resources

The concept of lean waste was first defined as part of the highly efficient Toyota production system. It was coined by Taiichi Ohno who developed a lean manufacturing framework designed to maximize efficiency, quality, and profitability. Part of his process involved identifying areas of waste related to a product or service that could be eliminated. This could be inventory waste, transportation waste, or simply excess processing in the manufacture of goods. But how can you identify where the areas of waste are in your company? How do you know where process improvements are required or standardized work formats will be beneficial? In this article, we explore how to identify every form of waste and then optimize resources to reduce its occurrence.

Identifying Areas of Waste

Identifying and eliminating lean waste areas requires careful research and problem-solving. The best approach is to apply one of the key lean manufacturing concepts known as value stream mapping. This enables companies to clearly identify where value is created and where activities are wasteful. It involves mapping out a manufacturing or production process so that every step, input, and output is labeled. This type of process mapping helps to convert what may be a complex concept into a simplified diagram so it can be clearly visualized.

It can also be helpful to look for areas of waste that have been specifically identified as occurring frequently. This gives companies a basis from which to start and acts like a checklist that you can work through when reviewing processes. As part of the Toyota framework, Ohno defined several wastes of lean that are common in most companies. These can be summarized in the acronym ‘downtime’ which stands for:

• Defects
• Overproduction
• Waiting
• Non-utilized talent
• Transportation
• Inventory
• Motion
• Excess processing

In the following sections, we’ll explore what each of these waste areas is and how businesses can reduce their occurrence.

Defects

Products that are defective cost a company time and money to resolve. They may need to be repaired, replaced, or refunded, all of which are unnecessarily wasteful activities. Getting things right the first time is the best way to avoid these issues. You can do this by:

•         Improving quality control
•         Creating documentation
•         Reviewing processes
•         Ensuring that you understand customer needs
•         Improving the designing process

Overproduction

The overproduction of goods is one of the most common manufacturing wastes. Many companies produce goods based on a target but this isn’t always aligned with actual sales volumes. One of the key pillars of lean management is to align output with customer needs so that a pull system is created. A few ways that you can optimize resources to reduce the waste of overproduction are:

•         Eliminate the production of ‘just in case’ stock
•         Clearly define customer needs
•         Produce based on sales forecasts or actual orders
•         Apply automation to increase production accuracy

Waiting

When production systems aren’t synchronized, waiting inevitably occurs. If one production area becomes overwhelmed then those before it can get backed up and those after it are left twiddling their thumbs. This is a huge lean waste in terms of time that can be avoided by taking some practical steps to streamline the manufacturing process:

•         Balance workloads
•         Maintain good communication between teams
•         Reduce set-up times to reduce the waste of waiting
•         Ensure sufficient staffing levels

Non-Utilized Talent

Although this wasn’t part of the original seven wastes identified by Ohno, it’s an increasing source in modern business. Under-utilizing the talents of employees means missing out on skills and knowledge that can be an invaluable asset to any company. A few ways to address this issue include:

•         Increasing training and education
•         Creating a structured framework for best practice sharing
•         Aligning staff tasks with their strengths or targeted development areas
•         Empowering employees and avoiding micromanagement

Transportation

Excessive movement and transportation can also be considered a source of lean waste. Excess transport costs time and money while also increasing the risk of damage occurring to products. It’s therefore important to reduce the unnecessary movement of materials and goods wherever possible.

•         Plan factory and office layouts carefully to maximize efficiency
•         Remove any excessive or unnecessary steps in a process
•         Minimize the opportunity for task-switching to maintain focus
•         Ensure that processes are well aligned and flow smoothly
•         Reduce the distances that need to be traveled by both products and staff

Inventory

Holding too much inventory drains resources and can also mask problems in other areas of the business. Having stock on hand to fulfill last-minute orders or deal with unexpected problems may solve the immediate issue. But this also means that managers are less inclined to look into the real source of the issue and find a solution to stop it from occurring again. On a surface level, excess inventory takes up space, uses raw materials, and eats into the bottom line. Ways to remove waste of this kind and improve inventory efficiency include:

•         Improving monitoring systems
•         Adjusting or removing replenishment buffers
•         Matching production speed with real-time demand
•         Working with reliable suppliers and other third parties

Motion

Although this may seem similar to transportation, it actually refers specifically to the motion of people, machines, and products. Excess motion may sound like a small thing but when it happens repeatedly it can actually produce a large amount of lean waste. This can be addressed by:

•         Improving the layout of workstations
•         Designing smart processes
•         Locating shared tools or machines centrally
•         Avoiding operational silos

Excess Processing

Excess processing can happen in the production of products and services, as well as day-to-day administrative tasks. Sometimes called non-value added activities, these are additional tasks or inputs that aren’t required or valued by the customer. Examples include requesting an excessive number of reports, multiple signatures, or including information that is superfluous.

•         Streamlining processes down to their minimal constituent parts
•         Identifying and removing instances of repetition or redundancy
•         Using digital tools and automation to remove the need for manual data input
•         Keeping things simple

By looking for instances of these lean waste areas in your business, you can begin to identify opportunities for improvement. Focusing on the activities that create value will give your company a competitive advantage while also boosting profitability too. Adopting a Kaizen or lean Six Sigma methodology can help to provide a structured framework for your business to follow. These approaches eliminate wasteful activities that drain your resources and allow you to focus on meaningful value creation.

Your Digital Platform for Reducing Lean Waste

Rever is all about sharing and reusing, doing and tracking. Continuous improvement becomes a hundred times easier with our innovative kaizen software. Using Rever’s dashboard, you can monitor the performances of your teams, the summary of their impact, and easily identify the people making the biggest difference at your company.

Rever Cycle is our version of the PDCA methodology and guides your teams on the exact steps to follow to execute their own ideas. It allows them to capture the entire process, from identifying a problem to experimenting and implementing a solution. They can use it to capture the before and after with pictures, notes and drawings, making their ideas a reality in no time. The time of your team is too valuable to be wasted in handmade drawings and complex explanations.

At Rever, we believe that anybody can be a knowledge worker and thrive. What makes us human is the capacity to grow our intellect and will, and to use them for good. We observe, especially at work, that most people are asked to stop thinking and do as they are told. We want to change that. We enable people to achieve their full creative potential.

Interested in learning more about Rever or how the principles of lean manufacturing can benefit your business? Then get a demo today with one of our friendly lean management experts.