Identifying & Reducing Wastes In Lean Manufacturing & Management
Lean Manufacturing has been quite popular since the Second World War period. It all started in a Japanese company called Toyota. They started to implement unique production techniques, philosophies, tools and concepts. They got amazing results. Their tools, techniques, philosophies and concepts are known as Toyota Production System(TPS). These TPS began to garner attention in the western world. It became popular in western countries as Lean. The primary goal of Lean is to reduce the Non-Value Adding Activities or Wastes to shorten the lead time, thereby leading to lower operational costs and faster delivery of products without compromising on the quality of the products. In this blog, I will be explaining the concept of “Wastes in Lean” and the various ways of reducing these wastes.
What Is Waste In Lean?
The term “Waste” has a different meaning in the Lean Manufacturing & Management setup. The term Waste in Lean is defined as follows:
Waste in Lean is any process that consumes resources but does not add any value to the customer
The primary goal of lean is to reduce these wastes. Waste in Lean is also known as Muda in the Toyota Production System(TPS). The seven original wastes were developed by Taiichi Ohno, the Chief Engineer at Toyota as a part of the Toyota Production System(TPS). The seven original wastes in lean are as follows:
- Transport
- Inventory
- Motion
- Waiting
- Overproduction
- Overprocessing
- Defects
The 8th Waste “Skills” was added to the list of wastes in the 1990s when the TPS was adopted as Lean in western countries. In this blog, I will be explaining each type of waste in lean.
Transport
The waste of transport in Lean is defined as the unnecessary movement of the transformed resources. The transformed resources include raw materials, Work In Progress(WIP), tools, inventory and finished goods. The transportation of goods from one place to another place does not add any value to the product or the customer. This waste incurs a lot of production cost
There are two main causes of the waste of transportation. They are as follows :
- Poor Bussiness Unit Layout: The distance between one production unit and another is quite large because of the plant set. The movement of goods from one part of the plant to another incurs transportation costs. Thereby leading to transportation waste.
- Poor Geographical Location Of The Bussiness Unit: Any business unit depends on raw materials and other inventories from other parts of the state, the country and the globe. The geographical location of the business unit from the source of the raw material & other inventories determines the transportation cost. This does not add value to the customer. Therefore the business unit must have access to all modes of transportation well within its reach to reduce transportation costs significantly.
The three ways to reduce transportation waste are as follows:
- Improving The Layout Of The Business Unit: The business layout can be improved to make sure that minimal transportation is needed to move the raw materials, inventory and other items within the business unit.
- To Make Sure That The Business Unit Has Easy Acess To The Various Trade Routes: The business unit must have easy access to all trade routes. This can considerably reduce the costs involved in transportation.
- Using a Transportation Matrix To Analyze and Optimize The Transportation Costs: A transportation matrix is used to analyze the frequency of travel from one point to another point either within the business unit or outside the business unit. One can also analyse the costs associated with transportation and work towards implementing solutions to reduce them.
Inventory
Before we understand the meaning of Inventory Waste In Lean, we must first understand the meaning of the word “Inventory”. Inventory is defined as goods that are intended to make a profit in a business. Raw materials, Work In Progress(WIP) and finished goods are considered inventory. Inventory is a valuable asset to a company.
Storing the inventory without making the best use of them for a very long time is as good as reducing the chances for the business unit to make a heavy profit.
The problems caused by having more inventory are as follows:
- Inefficient flow of capital
- Damaging the resources
- Increases the lead time for production
The causes of inventory waste in a business unit are as follows:
- Over purchasing of materials: The business unit at times procures more raw materials than required for meeting the customer demands. These materials stay in the inventory for a very long time without being used.
- Poor Customer Relationship Management(CRM): When the company fails to understand the customer demands, they tend to produce products beyond the needs of the customer. These products don’t sell in the market and finally end up sitting in the company’s inventory.
- Poor Production Planning: Poor production planning leads to excessive Work In Production(WIP). This WIP is a half-baked product. This is not suitable for selling in the market. This ends up waiting to become a full-fledged product in the inventory.
The ways to reduce Inventory Waste are as follows:
- Reducing Bottlenecks In The Manufacturing Process By Setting Up Extra Machines (Or) Allocating More Workers For The Particular Manufacturing Process.
- Procuring the required amount of raw materials for producing the required amount of products based on customer’s demand.
- Reducing WIPs by creating a well-calculated production plan.
Motion
The waste of motion in lean is defined as the unnecessary movement of the employees or workers in a business environment. Let me explain this definition with a little example from my own work experience. I used to work in the maintenance department of Himatsingka Linens. The Technical Associates(Fitters) used to work on maintaining the machines and handling their breakdowns. While handling some of the breakdowns, they would need some spare parts. These spare parts would be either at the store or in the maintenance department. They would go from the machine to either of the above-mentioned locations. This is an unnecessary movement of the staff.
The unnecessary motion could also include walking, lifting, reaching, bending, stretching, and moving. These activities tend to increase the workload on the employees and thereby affecting their health.
The causes of Motion Waste in the business unit are as follows:
- Poor design of the business unit
- Ignorance and absent-mindedness of the employees
From the above two mentioned causes of motion waste, we can solve the first one easily by implementing an ergonomic business unit design. To design an ergonomic business unit, one must know the basis of mapping the motion of the staff from one point to another point in the business unit. This can be done using a “Spaghetti Diagram”. A spaghetti diagram is used to identify the frequency of motion of the staff from one point in the business unit to another. The benefits of the spaghetti diagram are as follows:
- Identifying the inefficiencies
- Faster production and efficient movement of the staff
- Reduces fatigue and workload on the staff
- Saves time and money
Waiting
The waste of waiting in lean is defined as the loss of production time due to idle machinery or the staff waiting for a particular material. The main causes of the waiting waste are as follows:
- Poor Production Planning: The lack of foresight in production planning leads to bottlenecks and production losses.
- Unplanned Downtime Of The Machines: You can never expect a machine to work smoothly throughout the year. These machines may experience a breakdown thereby leading to production loss.
- Batch Production: Batch production is a type of production where the production of the next batch starts only after the previous batch has completed all the processes. If there are any bottlenecks or a breakdown in any one of the processes, the other batch production is also halted.
- Formalities: Formalities consume a lot of production time. Formalities could be anything ranging from clearances to material procurement.
- Neglecting Modern Technologies: The old equipment is not replaced in the majority of the industries because the new one is quite expensive. The old machinery is always susceptible to breakdowns.
The ways to reduce the waste of waiting are as follows:
- Using Pull Production Instead Of Batch Production: Pull production is piece-wise production. There are minimum chances of bottlenecks in the pull production. The mistakes in the production process can be rectified immediately. This solution is not always feasible since some products are meant to be manufactured in batch production.
- Implementing Modern Technology: New machines with modern technologies will improve the production rate and reduce downtime considerably.
- Implementing Single Minute Exchange Or Die(SMED): Single Minute Exchange Or Die(SMED) is a lean technique meant to reduce the waiting period. For example, we have a set of components that has to pass two operations. The output of the first operation is kept ready and sent immediately to the next process without any waiting.
Overproduction
The term Overproduction means producing components more than the market demand. This is indeed a non-value-adding activity that incurs losses to the business unit in terms of valuable assets like production time, material costs, labour and utilities. The causes of overproduction are as follows:
- Inaccurate Market Forecasting: The existing market for the product has not been analyzed accurately by the business unit.
- Procurement of Excessive Materials: The business unit may have procured excessive materials based on inaccurate forecasting of the market.
- Absence of Customer Relationship Management(CRM) System: The customer is always the core of any business unit. The lack or the absence of the CRM System will prevent the company from taking the right decisions on the production numbers leading to overproduction.
The solutions to reducing the waste of Overproduction are as follows:
- Implementing A Customer Relationship Management System: A CRM System will enable the business unit to analyze and understand the market accurately. This would help the organization take the right decision on the production numbers and thereby reducing the waste of overproduction.
- Practising Just In Time(JIT) Delivery: The term Just In Time Delivery means producing the required quantity of products at the right time and delivering it to the customer only when the consumer needs it. JIT can be practised by running smaller production batches and establishing stable production/work schedules.
Overprocessing
Overprocessing is defined as reworking the defective pieces or adding additional components that may or may not add any value to the customer. One must also understand that servicing the product well before its warranty period is also a form of overprocessing.
The major cause of over-processing waste in a business unit is the organization’s lack of understanding of the consumer’s requirements. Once the product is manufactured and it doesn’t satisfy the need of the consumer, this would dent the company’s image.
Every business unit must remember that “The customer is the King”. The customer must be happy and satisfied with the product for the business to flourish.
A very simple solution to reduce the waste of overprocessing is by implementing a CRM system to analyze the market. The intensive market analysis must be conducted before starting with the production of the new product.
Defects
Defects are basically defined as those products that are not suitable to be used. These defective products are inspected, replaced, discarded or reworked. The above-mentioned three operations are considered to be non-value-adding activities for the customer. The defects incur additional costs and delay in production.
The main causes of defects waste are as follows :
- Non-Standard Operation Conditions of The Machinery/Equipment: The defects can be caused due to improper methods of operating the machinery/equipment.
- The Poor Maintenace of The Machinery/Equipment: The equipment is not periodically maintained by properly lubricating the moving parts and replacement of the worn-out parts.
- Lack of Trained Manpower: If the labour is not trained to handle the machine and its production, the individual will not be able to control the defective objects obtained from the machines.
The solutions to reducing the defects waste are as follows:
- Proper Maintenace of The Machinery & Equipment
- Using Quality Control Tools like Root Cause Analysis to Find The Root Cause of The Defects
- Provide Adequate Training to The Manpower
- Inspection Only At the Required Checkpoints and Not After the Process
Skills
The eighth waste in a lean manufacturing or lean management setup is Skills. The staff working in the industry are skilled at the work they are allotted and also possess other skills. These other skills go unutilised by the organization. The non-utilization of these skills by the organizations is a form of waste under lean manufacturing/lean management.
The causes of skills waste are as follows:
- Poor Management
- Lack of Interest By The Management
- Lack of Transparency
The best way to tackle the skills waste is by using a skills matrix or skills board. In a skills board, the details of the employee and their individual skills apart from the work skill is highlighted. The skills board will allow the employers to know the real potential of their employees and make sure that their skills are used to the fullest to benefit the organization.
References
- https://theleanway.net/The-8-Wastes-of-Lean
- http://leanop.com/cms/en/glossary/
- https://leanmanufacturingtools.org/129/waste-of-defects-causes-symptoms-examples-and-solutions/
- https://safetymanagement.eku.edu/blog/the-seven-wastes-of-lean-manufacturing/#:~:text=Under%20the%20lean%20manufacturing%20system,processing%2C%20waiting%2C%20and%20transport.
- https://blog.cpsgrp.com/nehp/8-wastes-of-lean-construction-overproduction
- https://www.udemy.com/share/101WMe3@cYOTikwxqnjWfxD9JKyZEbEM8HaExOJNZyIU2qMhi47qQIndvwObMxDa2a4yjpEMfw==/