One of the key steps in Lean is the identification of which steps add
value and which do not. By classifying all the process activities into these
two categories it is then possible to start actions for improving the former
and eliminating the latter. Once value-adding work has been separated from
waste then waste can be subdivided into 'needs to be done but non-value adding'
waste and pure waste. The clear identification of 'non-value adding work', as
distinct from waste or work, is critical to identifying the assumptions and
beliefs behind the current work process and to challenging them in due course.
There are seven wastage in
manufacturing.
01. Transportation
Each time a
product is moved it stands the risk of being damaged, lost, delayed, etc. as
well as being a cost for no added value. Transportation does not make any
transformation to the product that the consumer is willing to pay for.
02. Inventory
Inventory, be
it in the form of raw materials, work-in-progress (WIP), or finished goods,
represents a capital outlay that has not yet produced an income either by the
producer or for the consumer. Any of these three items not being actively
processed to add value is waste.
03. Motion
In contrast to
transportation, which refers to damage to products and transaction costs
associated with moving them, motion refers to the damage that the production
process inflicts on the entity that creates the product, either over time (wear
and tear for equipment and repetitive stress injuries for workers) or
during discrete events (accidents that damage equipment and/or injure workers).
04. Waiting
Whenever goods
are not in transport or being processed, they are waiting. In traditional
processes, a large part of an individual product's life is spent waiting to be
worked on.
05. Over-processing
Over-processing
occurs any time more work is done on a piece than is required by the customer.
This also includes using tools that are more precise, complex, or expensive
than absolutely required.
06. Over-production
Overproduction
occurs when more products is produced than is required at that time by your
customers. One common practice that leads to this muda is the production of
large batches, as often consumer needs change over the long times large batches
require. Overproduction is considered the worst muda because it hides and/or
generates all the others. Overproduction leads to excess inventory, which then
requires the expenditure of resources on storage space and preservation,
activities that do not benefit the customer.
07. Defects
Whenever
defects occur, extra costs are incurred reworking the part, rescheduling
production, etc. This results in labor costs, more time in the
"Work-in-progress". Defects in practice can sometimes double the cost
of one single product. This should not be passed on to the consumer and should
be taken as a loss.
