Identifying Lean Waste

1. IDENTIFYING WASTE Discover, Eliminate, Prevent © Operational Excellence Consulting. All rights reserved.

2. NOTE: This is a PARTIAL PREVIEW. To download the complete presentation, please visit: https://www.oeconsulting.com.sg Learning Objectives 1. Discover waste in your work environment 2. Learn how to remove waste 3. Learn how to prevent waste Copyrights of all the pictures used in this presentation are held by their respective owners. 2 © Operational Excellence Consulting. All rights reserved.

3. Contents 1. What is Waste? 2. Waste Classification: Four Models of Waste 3. How to Discover Waste 4. How to Remove Waste 5. How to Prevent Waste 3 © Operational Excellence Consulting. All rights reserved.

4. Introduction to Identifying Waste § The most difficult part of an improvement process or problem solving effort is often the first step § For improvement to occur, individuals involved in the improvement process have to discover the underlying waste and begin to see the improvement potential § This training presentation will teach you the four models of waste which you can use to identify waste in your processes and work areas 4 © Operational Excellence Consulting. All rights reserved.

5. Definition of Waste “Waste is anything other than the minimum amount of equipment, materials, parts, space, and worker’s time which are absolutely essential to add value to the product.” Shoichiro Toyoda President, Toyota © Operational Excellence Consulting. All rights reserved.

6. Waste Takes Root When We Accept Stopgap Improvement Real Stopgap Improvement A Problem Occurs Improvement Evading the problem Ask “why” until root cause is understood “For the time being, let’s…” Apply best solution Institutionalization “Let’s find ways to work around it.” Problem is solved Habituation “We’ve always done it like this.” Substantiation “No one has any objection to the way we do this now.” 6 © Operational Excellence Consulting. All rights reserved.

7. Four Models of Waste 1. The three MUs 2. The 5M + Q + S 3. The flow of goods 4. The eight types of waste (manufacturing and service/office) 7 © Operational Excellence Consulting. All rights reserved.

8. What are the Three MUs? Activities that do not add value Workload that is uneven Work that creates burden for the team members or processes 8 © Operational Excellence Consulting. All rights reserved.

9. Explanation of the Three MUs The Three MUs Meaning in English Explanation (using example of Capacity versus Load) • Capacity exceeds Load Muda • Waste • Capacity sometimes exceeds the Load • Unevenness • Inconsistency • Variation Mura • Load sometimes exceeds the Capacity • Overburden • Irrationality • Load exceeds Capacity Muri 9 © Operational Excellence Consulting. All rights reserved.

10. Eight Types of Muda (Waste) Over-production Producing more than what the customer needs Waiting Intellect Employees waiting for another process or a machine/tool Not using employees full intellectual contribution Over-processing Adding excess value when the customer does not require it Motion Waste Extra physical/mental motion that doesn’t add value Defects Reprocessing, or correcting work Transportation Moving product from one place to another Inventory Building and storing extra services/products the customer has not ordered 10 © Operational Excellence Consulting. All rights reserved.

11. What is Mura (Unevenness) § Mura is the variation in the operation of a process not caused by the end customer § It is the unevenness, unbalanced work on machines § Mura results when employees are told to work like crazy early in the morning only to stand around and do nothing late in the day § Result: Excess capacity allocation and increased cost 11 © Operational Excellence Consulting. All rights reserved.

12. Mura Looks Like Bumpy Unlevel Stop & Start Unevenness Up & Down Peak & Valley Unequal Spiky Lumpy 12 © Operational Excellence Consulting. All rights reserved.

13. What is Muri (Overburden) § Muri is the overburden on equipment, facilities and people caused by muda and mura § Muri is pushing a machine or person beyond natural limits § Overburdening people results in safety and quality problems § Overburdening equipment causes breakdowns and defects 13 © Operational Excellence Consulting. All rights reserved.

14. Muri Looks Like Unrealistic Tasks Overloading Pain Overburden Unnatural Movements Poor Ergonomics Poor Design 14 © Operational Excellence Consulting. All rights reserved.

15. The 5M + Q + S § Another way of thinking about waste in a factory is to focus on the areas where waste may occur § Man § Material § Machine § Method § Management § Quality § Safety 15 © Operational Excellence Consulting. All rights reserved.

16. The 5M + Q + S Man Material Machine The waste of: • Walking • Waiting • Searching • Unnecessary movement • Not easily recognizable waste The waste of: • Parts • Bolts • Welds • Functions • Storage and handling The waste of: • Large machines • General purpose machines • Conveyors • Machines with wasteful movements • Breakdowns • Machine handling Management The waste of: • Materials • Meetings • Management Control • communications Method Quality The waste of: • Large lot production • Inventory • transportation • Retention • Non-standardization • Picking up and setting down work pieces The waste of: • Making defective goods • Fixing defects • Errors • Inspection • Quality control Safety The waste of: • Disaster prevention methods • Fixing defects (“Safety first” really requires removing all waste that can lead to accidents and/or injuries 16 © Operational Excellence Consulting. All rights reserved.

17. The Flow of Goods § The third way of thinking about waste in a factory is to focus on the flow of goods in production 17 © Operational Excellence Consulting. All rights reserved.

18. The Flow of Goods 1. Materials are procured 2. Materials are processed • Materials are retained in the warehouse Materials are conveyed to processes on the production line Materials are retained at the process equipment (WIP) Materials are picked up for processing • Processed goods are set down and retained on the other side of the processing machine (WIP) Goods are conveyed to an inspection point Goods are retained until inspected Goods are set down and retained on the other side of of the inspection process Inspected goods are conveyed to the finished goods warehouse Finished goods are retained until prior to shipment • • • • • • • • Four key activities can be observed from the flow of goods: 1. Retention (Non-value-add) 2. Transportation (Non-value-add) 3. Processing (Value-add) 4. Inspection (Non-value-add) 3. Finished goods are delivered to customer 18 © Operational Excellence Consulting. All rights reserved.

19. The Eight Types of Waste in a Production System Transportation Retention Processing Inspection Retention Processing waste Transportation Defects Inventory Overproduction (production methods) Motion waste (operation methods) Waiting time (imbalances) Intellectual waste 19 © Operational Excellence Consulting. All rights reserved.

20. Waste Finding – 4 Levels of Magnitude 0 ------------------ No waste found Magnitude 1 ------------------ Very little waste of 2 ------------------ Some waste Waste 3 ------------------ A lot of waste 20 © Operational Excellence Consulting. All rights reserved.

21. Overproduction § It is the worst of the eight waste § It is the exact opposite of just-in- time production § Overproduction means making what is unnecessary, when it is unnecessary, and in unnecessary amounts § Occurs when you manufacture items when there are no orders 21 © Operational Excellence Consulting. All rights reserved.

22. Causes of Overproduction § Large-lot production § Anticipatory production (producing product in advance of demand) § Long changeover times § Building enough stock to replace defective parts produced § Overstaffing, or too much equipment § Machines that turn out parts too quickly 22 © Operational Excellence Consulting. All rights reserved.

23. Waste-finding Checklist – Overproduction Waste-finding Checklist – Overproduction Process: Date: Description of Waste Yes No Magnitude Causes and/or Improvement Plans 1 No production schedule or control boards. 2 No levelling of production schedule. 3 Production not in sync with production schedule. 4 Items missing. 5 Defective goods produced. 6 Equipment breakdowns. 7 Too much manual assistance required. 8 Machines have too much capacity. 9 Lots are grouped into batches. 10 Using “push” production. 11 Caravan style operations. 12 Not balanced with next process. Total 23 © Operational Excellence Consulting. All rights reserved.

24. Accumulation of Inventory in the Flow of Goods Processing station 1 Assembly station 1 Centralized processing Processing station 2 Assembly station 2 Processing station 3 Assembly station 3 Retention of goods 24 © Operational Excellence Consulting. All rights reserved.

25. Unbalanced Production Line Inventory Upstream process Inventory Downstream process 25 © Operational Excellence Consulting. All rights reserved.

26. The Difference Between Transportation (Conveyance) & Material Handling Transportation Retention Retention (Movement between retention points is often called conveyance or transportation.) Movement of Goods Material handling Retention Process (Movement between a retention point and a process [or between two processes] is often called material handling.) Retention point Process Transportation Material handling 26 © Operational Excellence Consulting. All rights reserved.

27. Kinds of Inspection Sorting inspection (Defect-finding inspection) Quality control (Using SQC methods to reduce defects) Downstream process control (Defect-reducing inspection at downstream processes) Information inspection (Defect-reducing inspection) Inspection Quality control by process operators (Defect-reducing methods by operators at their own processes) Back-to-the-source inspection (Defect-preventing inspection) To reduce defects, their root cause must be found. Inspection that only sorts out the defective parts is not a solution to defect waste. 27 © Operational Excellence Consulting. All rights reserved.

28. Waste-finding Checklist – Motion Waste-finding Checklist – Motion Process: Date: Description of Waste Yes No Magnitude Causes and/or Improvement Plans 1 Walking. 2 Turning around. 3 Leaning sideways. 4 Bending over. 5 Too wide arm movements. 6 Unnecessary wrist movements. 7 Left or right hand is idle. 8 Poorly utilized idle time. 9 Wasteful work piece setup/removal. 10 Non-standardized repetition of operations. Worker operates using different motions each time. 11 12 Operations divided into too many little segments. Total 28 © Operational Excellence Consulting. All rights reserved.

29. A Value Stream Map Provides an Overview of the End-to-end Production Process Information flow Management Control Customer Supplier Work & Information Flow • Creates an end-to-end view of the production system • Demonstrates interaction between material/work and information flow • Provides a common visual language for understanding a complex system 29 © Operational Excellence Consulting. All rights reserved.

30. The Value-added Flow Chart § The value-added flow chart is a mechanism to improve cycle times and productivity by visually separating value- adding from non-value-adding activities. The process is very straightforward, as outlined in this section. 30 © Operational Excellence Consulting. All rights reserved.

31. Figure 1 Figure 2 Figure 3 Non-Value-Added Value-Added Steel Coil Stock Inventory (96 Hr.) Steel Coil Stock Inventory (96 Hr.) Cycle Time Analysis Stamp Steel (0.3 Hr.) Stamp Steel (0.3 Hr.) Value-Added Non-Value-Added Buffer Inventory (8.0 Hr.) Buffer Inventory (8.0 Hr.) Cabinet Construction (0.2 Hr.) Cabinet Construction (0.2 Hr.) 3% Inspection & Rework (0.1 Hr.) Inspection & Rework (0.1 Hr.) Buffer Stock (3.0 Hr.) Buffer Stock (3.0 Hr.) Paint Cabinet (0.5 Hr.) Paint Cabinet (0.5 Hr.) Inspection & Rework (0.2 Hr.) Inspection & Rework (0.2 Hr.) 97% Buffer Inventory (5.0 Hr.) Buffer Inventory (5.0 Hr.) Final Assembly (3.0 Hr.) Final Assembly (3.0 Hr.) Test & Rework (0.2 Hr.) Test & Rework (0.2 Hr.) Total Cycle Time = 116.5 Hours Total Value-Added Time = 4.0 Hours Total Non-Value-Added Time = 112.5 Hours 31 © Operational Excellence Consulting. All rights reserved.

32. Example of Flow Process Chart § For each of the events, identify the waste and make recommendations for the elimination or reduction of waste § The Flow Analysis Chart can also be adapted for operations at each workstation. In that case, it should be named as the Operations Analysis Chart 32 © Operational Excellence Consulting. All rights reserved.

33. Exercise: Prevent Waste In your respective groups, discuss the following: 15 minutes 1. What kind of standardization exists in your workplace? How could it be improved? 2. What kinds of visual and auditory control are being used in your workplace? How could they be improved? 3. Apply the 5W and 1H sheet to a problem on your line. What did you find out that you didn’t know before? 33 © Operational Excellence Consulting. All rights reserved.

34. About Operational Excellence Consulting § Operational Excellence Consulting is a management training and consulting firm that assists organizations in improving business performance and effectiveness. § The firm’s mission is to create business value for organizations through innovative operational excellence management training and consulting solutions. § OEC takes a unique “beyond the tools” approach to enable clients develop internal capabilities and cultural transformation to achieve sustainable world-class excellence and competitive advantage. For more information, please visit www.oeconsulting.com.sg 34 © Operational Excellence Consulting. All rights reserved.

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