The 7 wastes of LEAN management means that it is essential to eliminate wasteful activities in order to build a successful business. This idea is an integral part of Lean Thinking, which helps you increase your profitability. Toyota Production System is the source of the idea to eliminate waste. Taiichi Ohno is considered to be one of the founding fathers of lean manufacturing. He dedicated his entire career to creating a solid, efficient work process.
Ohno revealed three main roadblocks that can negatively impact a company’s work process during his trip: Muda, Muri (overburden), Mura (unvented).
He analyzed his observations and created 7 wastes of LEAN in management, which became a popular method for optimizing resources and cost reduction.
The 7 Wastes in Lean
Your company’s success depends on optimizing your processes to reduce waste. Wasteful activities can reduce profitability, increase customer costs, lower quality, and decrease employee satisfaction. You need to identify non-value-adding activities, and then improve or eliminate them.
The lean theory identifies seven major areas in which you can identify Muda activities. These are more common in management than the 7 wastes of Lean.
This is when you move resources (materials) and the movement doesn’t add value. The excessive movement of materials can cause quality problems and cost your business. Transport can often force you to pay additional for space, time, or machinery.
A company may have excess inventory because they keep “just in case” stocks. Companies may overstock to meet unanticipated demand or protect against production delays, low quality, and other problems. These excessive inventories are often not sufficient to meet customer needs and do not add value. They increase storage costs and depreciation costs.
This type of waste can include the movement of employees or machinery, which is complicated and unneeded. They can lead to injuries and prolonged production times. Also, you should do everything possible to make sure workers do their jobs as efficiently as possible.
This is the most obvious waste that you can identify. The “waiting waste” is when goods or tasks stop moving. Because lost time is the most obvious indicator, it is easy to identify. It could be goods that are still to be delivered, equipment that is not yet fixed, or documents waiting for approval from executives.
It is easy to see why excess production is Muda. Overproducing means you produce more than the customer needs, which can lead to higher costs. Overproduction actually causes the six other wastes to emerge. Excessive products or tasks can lead to increased transportation costs, more motion, longer waiting times, and other problems. If a defect occurs during overproduction, your team will have to rework additional units.
This is usually caused by work that does not add value or provides more value than necessary. These extra features can add cost to your business by adding unnecessary features to products that no one will use. A car manufacturer might decide to install a TV in the trunk of its vehicle. It is unlikely that anyone will use it. It will also cost resources and increase the price of the product, which customers will not be willing to pay.
Defects may lead to rework or worse, scrap. Defective work must be returned to production, which can lead to lost time. In some cases, additional reworking is necessary, which can lead to increased exploitation of labor and other tools.
The 7 types of waste can be toxic for your business, as you can see. You can view them as opportunities to improve work processes, and most importantly, optimize resource utilization. Different businesses may have different requirements for the seven types of waste.
Let’s take a look at some examples of real-life waste.
The 7 Types Of Waste Found in Different Environments
The top management should be able to identify wasteful activities. High-level managers usually have a comprehensive view of all processes. This is why we can say that they manage a portfolio of activities, functional area,s and projects. It is their responsibility to improve processes and promote a culture of continuous improvement.
But, the wasteful activities of businesses may differ. The following examples will show you how waste types can differ across functional areas.