Identification of Waste

1. Identification of Waste • Input • (Resources) • Energy • People • Capital • Water • Materials • Tools • Output • Products • Services Transformation WASTE WASTE

2. Purpose of Waste • Educate supplier of the evils of waste • What • Where • Why • Steps to reduce and/or eliminate • Show improvement potential that exists • Improve the process’s value added content

3. Identification of Waste • Input • (Resources) • People • Capital • Tools • Energy • Materials Transformation • Output • Products • Services WASTE WASTE

4. Defining Waste Webster: “To consume carelessly” “Squander” “Fail to take advantage” “Uncultivated area” “Junk” “Worthless residue” “Lose energy” “Grow weaker”

5. Definition of Waste • Anything that doesn’t add value to the process • Anything that doesn’t help create conformance to the customer’s specifications • Anything your customer would be unwilling • to pay you to do

6. Understanding Waste • Identification and elimination of waste is the • central focus of a lean system. • It is dependent on the understanding and • involvement of all employees. • Successful implementation requires all employees be trained to identify and eliminate waste from their work areas.

7. Understanding Waste Waste exists in all work . . . . and at all levels in the organization

8. Understanding Waste • Waste: Anything other than the minimum resources • Equipment and tooling • Direct and indirect labor • Material • Floor space • Energy • Absolutely necessary to add value to the product !!

9. Identification of Waste Types of Waste • Inventory • Overproduction • Correction • Material & Information Movement • Processing • Waiting • Motion

10. WASTE of Inventory Definition: Any supply in excess of customer requirements necessary to produce goods or services just-in-time • Symptoms • Complex tracking systems • Extra storage & handling • Extra rework / hidden problems • Paperwork / documents • Stagnated information flow • High disposal costs • Obsolete material / landfill • In-process packaging • High utility costs • Root Causes • Product complexity • Incapable processes • Unleveled scheduling • Poor market forecast • Unbalanced workload • Unreliable supplier shipments • Inadequate measurement • Misunderstood communications • Reward system

11. Your Company Inventory Hides Problems !!Inventory Hides Waste !! Inventory Level Water = Inventory Equipment Downtime Variation Large Lot Sizes Supplier Quality Poor Layout Long Changeover Rocks = Problems (Opportunities)

12. Why We Want To Reduce Inventory • 1) Interest expense associated with working capital: • Requirements to produce goods: • - People, materials, facility, know-how, customers • - An organization + working capital • Working Capital = Cash + Inventory + Accts. Receivable - Accts. Payable • - Collect faster • - Defer payments • - Reduce inventory • Benefits of reducing inventory in working capital: • - Save interest expense • - Free up cash for investment • 2) The greater the inventory, the greater the handling: • Forklifts, bins, containers, indirect labor to move/store inventory • Administrative effort and cost to control the inventory • (losses, locating and counting)

13. Why We Want To Reduce Inventory • 3) Inventory deteriorates, causing more scrap & rework: • Metal rusts • Lubricants dry out • Materials accumulate dirt • 4) Inventory takes up space: • Adds cost to heat, light, and insurance • Facilities should be used for Value Added activities • (i.e., production rather than warehousing) • 5) Guiding principles of “lean” manufacturing: • Elimination of buffers makes problems surface and forces • organization to address and resolve problems. • Leads to need for: • - Pull systems • - Quick die setup • - Manufacturing organized by product, rather than process • - Good balancing • - Multifunctional workers • - Preventative maintenance • - etc.

14. Why We Want To Reduce Inventory • 6) Reduce scrap / rework. • When defect is detected, the entire inventory has to be • scrapped, reworked, and/or sorted.

15. WASTE of Overproduction Definition: Producing more than needed Producing faster than needed • Symptoms • Excessive raw materials • Extra inventory • Unnecessary work • Excessive floorspace utilized • Unbalanced material flow • Backups between departments • Complex information management • Disposal charges • Extra waste handling & treatment • High utility costs • Root Causes • Just-in-case logic • Misuse of automation • Long process set-up • Unleveled scheduling • Unbalanced workload • Over engineered equipment/capability • Redundant inspections • Lack of reuse & recycling

16. WHITE OUT WASTE of Correction Definition: Inspection and/or repair of a product or service • Symptoms • Rework, repairs & scrap • Added inventory costs • Customer returns • Loss of customer confidence • Loss of business • Missed shipments / deliveries • Hazardous waste generation • Frequent spill cleanups • High disposal costs • High utility cost • Root Causes • Weak process control • Questionable quality • Lack of error proofing • Unbalanced inventory level • Deficient planned maintenance • Poor product design • Customer needs not understood • Improper handling • Poorly managed waste streams • Inadequate training

17. OVERNIGHT DELIVERY WASTE of Material & Information Movement Definition: Any material or information movement. • Symptoms • Extra handling • Extra handling equipment • Extra inventory • Large storage areas • Over-staffing • Reduced quality • Extra Paperwork • Extra hand-offs • Transport of disposal • Excessive energy consumption • Excessive emissions • Root Causes • Mislocated materials • Unleveled scheduling • Unfavorable facility layout • Redundant inspections • Poor workplace organization • & housekeeping • Poorly managed waste streams • Unbalanced processes • Supply chain management

18. WASTE of Processing Definition: Effort which adds no value to the product or service from the customer’s perspective. • Symptoms • Unnecessary work • Extra equipment • Longer lead time • Reduced productivity • Extra material movement • Sorting, testing, inspection • Inappropriate use of resources • Excess energy consumption • Processing by-products • Root Causes • Product changes without process changes • Just-in-case logic • Lack of communication • Redundant approvals • Extra copies, excess information • Undefined customer requirements • “Stop-gap” measures that • become part of the process • Lack of reuse / recycling

19. WASTE of Waiting Definition: Idle time created when people wait for machines, people wait for people, machines wait for people, and machines waiting on machines. • Symptoms • Under-utilization of resources • Reduced productivity • Increase in investment • Idle equipment • Large waiting / storage rooms • Equipment running, not producing • Unnecessary testing • Root Causes • Unbalanced work load • Unplanned maintenance • Long process set-up times • Misuse of automation • Quality problems • Unleveled scheduling • Ineffective layout • Specialization

20. WASTE of Motion Definition: Any movement of people or machines. • Symptoms • Reduced productivity • Large reach / walk distances • Longer lead times • Excess handling • Reduced quality • People / machines waiting • High energy cost • Inappropriate use of resources • Root Causes • Poor ergonomics / layout • Machine / process design • Inconsistent work methods • Poor workplace organization & housekeeping • Extra “busy” movements while waiting

21. Resource Conservation and Pollution Prevention

22. Resource Conservation and Pollution Prevention

23. Resource Conservation and Pollution Prevention

24. Observation Worksheet: Identification of Waste Observations Key Point Overproduction (Too much, too fast) Correction (Rework, inspect) Material Movement (Too much, too far) Processing (Adds no value) Inventory (Excess stock, banks) Waiting (Idle time) Motion (Inefficient movement) Unevenness (Overburden current methods)

25. Observation Worksheet: Identification of Waste Key Point Resource Conservation and Pollution Prevention Energy (Excess usage) Water (Excess usage) Transportation (Fuel use, emissions) Hazardous Waste (Toxicity, cost) Non-Hazardous Waste (Inefficiency, cost) Product Design (Cost, inefficiency, toxicity) Environmental Mgmt. Practices (Excess usage, waste) Other