Better performance by reducing waste
Waste is the loss of something valuable. It is a concept that we all know, but unfortunately do not always recognize. Waste is present in every organization, which ideally should be minimized or even prevented as much as possible. With this insight, we guide you through the different variants of waste and we give examples based on the TIMWOODS model. We provide tools to identify waste within your organization.
In essence, eliminating waste provides an organization with the following benefits: lower costs, less risk, happier customers and employees. This is based on the Lean philosophy. In Lean 3 different processes are described. First of all, the primary process, here the goal of the organization is realized and the core activities of the organization are represented. The secondary process is the supporting processes necessary to realize the primary process. Finally followed by the control process, with which the primary and secondary process are (adjusted) controlled.
Eliminating waste starts with determining what value is in the eyes of the customer. Then you see which steps in the process add value. An activity adds value if it meets 3 conditions:
- The customer must be willing to pay for the activity
- The activity must change the product, bringing it closer to the final product requested by the customer
- The activity must be done right the first time
In short, the aim is to have almost only process steps that add value. With the exception of the much-needed secondary and steering steps.
What can be gained from eliminating waste?
Eliminating waste provides several benefits for an organization. In essence, it results in reduced costs, for example through more effective deployment of employees and thus a reduction in wage costs. Lower costs often mean an increase in profit in the long run.
In addition, there is a great advantage for employees and customers. Eliminating waste in the chain shortens lead times. Employees have more time for primary tasks and a customer can be helped faster and more effectively. This has a positive side effect of increased customer and employee satisfaction.
Finally, risks will decrease when the chain is reduced. A chain that is too long, with many detours, entails risks in the area of loss of information, more bottlenecks that can lead to delays, etc. These risks will automatically decrease when the total chain is shortened.
The 8 forms of waste and examples
The mnemonic TIMWOODS is used to remember and map the eight largest forms of waste.
The first form of waste in the TIMWOODS model is Transportation, the unnecessary transportation of materials or information. For example, it often happens that delivery drivers drive inefficient routes because different time slots are chosen by customers. PICNIC has cleverly eliminated this form of waste by using fixed delivery times per district. Thanks to the fixed delivery times, the deliverers can drive an efficient route through every district.
inventory describes the problem where more information or materials are in stock than necessary for the process. For example, a supplier of confectionery with huge inventories that are not immediately sold will run into the problem that its confectionery becomes obsolete, requiring large losses to be sold to price-competitive companies such as Action.
Then we arrive at motion, the inefficient movement of people. This is a waste that we may all experience in the office. Running from meeting to meeting takes a lot of time and the meetings are so tightly scheduled that we keep other people waiting.
This brings us to the fourth waste, the inefficient to wait on materials and information. When a process chain becomes very long, communication deteriorates and there are more risks at each step. One supplier will have to wait for delivery of the predecessor before the process can be continued. This can be solved, for example, by having the priorities clear in a joint day or week start.
Overproduction means that you produce more than the customer demands. The moment you work ahead while not everything is clear yet, this may mean that you have to do repair work later because the correct assumptions have not been made. This also causes defects, services or products that do not meet expectations. Waste can be eliminated by not working too far ahead and incorporating lessons learned. Taking lessons learned will save you from having to reinvent the wheel and will save you time.
Overprocessing & Underprocessing, do more work than the customer is willing to pay for or require too much work to deliver quality. For example, using a very expensive device, such as a machine in a print shop with which A3 format can be laminated. This device requires a lot of capital and does not pay for itself in a small print shop due to the small numbers of visitors and the low demand for laminated A3 format. Purchase would mean that the device is used inefficiently.
Last mentioned, but also a common waste is unused skills. For example, the skills of employees are less effective when the employee has to perform other activities than originally hired, for example due to a shortage of work.
To shift the focus to the primary tasks, many tools have been developed based on the lean philosophy to tackle waste. For example, you can use an analysis tool such as Value Stream Map or Takttijd-analysis (Time vs. Value). At their core, these tools are about identifying every step and task in a process and measuring value against key KPIs. For each step you can ultimately indicate what the added value is for the customer. In this way you can see in a relatively simple way which steps in the process add value. Subsequently, the process will have to be restructured and adapted in an effective way, so that only the valuable tasks in the process remain.
Get started yourself
After this explanation of the different types of waste, it will become a lot easier to recognize waste and eventually shift the focus to the primary tasks that matter most. Always ask yourself, what is the goal of my team or organization and what does this action or process contribute to this? After all, everything you do must be traceable back to the overarching goal. If it doesn't contribute anything, it could just be a form of waste!
If you, as an organization, have trouble finding your goals, reducing waste in the chain or implementing a solution, you can always ask our consultant for advice without obligation.