Recognizing sources of waste in your operation allows you to improve without cutting corners
In a previous newsletter we discussed the concept of value. Value was defined to be anything that the customer is willing to pay for. From the perspective of Lean and Six Sigma, any activity that fails to add value to the product or service you provide is waste and should be removed from the process, if possible.
Below shows a list of commonly cited forms of waste. While the list may appear to focus on manufacturing processes, we can see that these classifications apply to companies that provide services as well.
Truly, waste is everywhere we look in any business operation. A fact that is well understood by those who practice Lean and Six Sigma is that, even in the most efficient operations in the world, no more than 10% of the work being done actually adds value. Ninety percent or more of activity in any operation is waste and should be eliminated from the business.
This is actually good news to the process improvement specialist. It tells us that whatever the business operation is that needs to improved, we can expect to find numerous opportunities to reduce costs and improve prompt delivery performance, product quality, and safety performance at the same time by simply focusing on the waste in the process.
Important Tip: Focus on Reducing the Waste in Your Operation
Wasteful activities, those that the customer is not willing to pay for, comprise the majority of what is being done in your operation. The customer will not be negatively impacted when you reduce or eliminate any of the “TIMWOOD” activities because, by definition, these are things that they do not care about. This is a huge opportunity for those who choose to address it.