Every business has wasteful processes or procedures that hinder performance. However, there are 8 primary areas of waste to avoid. Avoiding these wastes is easier by knowing what causes these wastes, and the effect of these wastes on the business.
1. Transportation
Excess of waste due to excessive domestic transportation of materials or product between various production processes.
Cause:
Incorrect layout
Wrong material or product locations
Do not follow storage instructions
Effect:
Requires excess resources (equipment and labor)
Increases the risk of accidents
Excessive power consumption
High cost of equipment maintenance
Delays for the process-to-process cycle times
2. Inventory
Inventories of materials, supplies, spare parts, work in process, and finished goods products.
Cause:
Incorrect planning
Production buffers
Forecast change
Effect:
High cost of unused inventory
Demands excessive storage space
Increases handling times
Increases transportation times
3. Motion
Physical movements that people perform in excess.
Cause:
Lack of planning in the ergonomic field
Incorrect workstation design or layout
Work instructions not performed correctly
Effect:
Fatigue which causes low levels of productivity
Lower production per unit time
Fail production goals
Risk of injuries
4. Waiting
The time that a piece, product, or service must wait for further processing.
Cause:
Setup times
Time queue for processing
Work instructions not executed as expected
Employee absenteeism
Effect:
Incomplete work
Waste of time for repairs
Maintenance work
Timeouts ordered
Excess of inventory in the previous process
Delays administrative tasks
5. Over Processing
Any time more work is done on a product/service than what is required by the customer.
Cause:
Errors in the production process
Production is not stopped on time
Defects are found
Following work instructions incorrectly
False failures
Effect:
Gaps in the production plan
Missing materials
Labor cost increase
Customer dissatisfaction
Deficiency in product/service design
6. Over Production
Produce more than what is required. Does not follow one piece flow or production plan.
Cause
Not following the production plan
Unbalanced processes
Unnecessary safety stocks (buffers)
Resources not aligned with the plan
Effect
Increases storage cost
Increases cost of handling materials first
Incorrect consumption of materials
Poor material procurement
Excess materials
Obsolete materials
7. Defects
The need to overhaul parts in the process, or finished products. The need to recycle or destroy products that do not meet the optimum quality control conditions that cause significant losses.
Cause
Poor product materials
Poor equipment quality
Incorrect usage of equipment
Effect
Costs of customer guarantees
Costs of technical services
Loss of customers/sales
Fail to meet customer demand
Cost to compensate for what was missed
Rework to fix defects
8. Unused Creativity
Waste of human potential, with no use of people’s skills.
Cause:
Limited autonomy in basic tasks
Procedures created to control people rather than to facilitate work
Effect:
Eliminate breakthrough thinking
Lack of teamwork, no open communication
Delays continuous improvement
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