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Muda in Service Industries

“Why so many systems & handoffs
     – vertical / horizontal ??”

      Anand Subramaniam
“Why waste time learning, when ignorance
            is instantaneous? ”

                              - Bill Watterson




                                             2
Increase Velocity by Waste Elimination



  Speed                       Flexibility

           =             +
                 Cost




                                            3
Why Eliminate Waste ?
 Don’t throw money away $$

 Keep customers– cheaper to retain than to acquire

 To avoid high operating and production costs that
  are ultimately passed on to the customer

 To maximise opportunity to have a significant
  financial impact on the business

                                                      4
Service Waste - NVA
                    1.   Information

                    2.   Energy and Water

                    3.   Defecting customers

                    4.   Untapped Human Potential

                    5.   Materials
96% Non Value Add
                    6.   Customer Time

                    7.   Service and Office

                    8.   Inappropriate Systems


                                                 5
Types of Service Waste
1. Information           5. Materials

2. Energy and Water      6. Customer Time

3. Defecting customers   7. Service and Office

4. Untapped Human        8. Inappropriate
   Potential                Systems


                                                 6
# 1 - Information

 Should not take very much time

 Should not require double checking

 Figuring out what to do and when to do it




                                              7
# 2 - Energy and Water

 Fixing leaks

 Shutting down the machine

 Turning off a dripping faucet

 Shutting off unnecessary lighting

                                      8
# 3 - Defecting Customers

 Loss of existing customers resulting from:
   High costs

   Poor quality

   Poor service

   Late deliveries

                                               9
# 4 - Untapped Human Potential

 Create / develop thinking people

 The power of using the thoughts of all
  employees; not just managers




                                           10
# 5 - Materials

 Recovery, remanufacturing, and recycling

 Conserving materials during design,
  manufacture, customer usage, and more




                                             11
# 6 - Customer Time

 Forced to wait in value-adding services

 Customer inconvenience: waiting for a
  delivery or traveling for a service not
  offered locally




                                            12
# 7 - Service and Office

 Wasted food             Excess emails

 Copies in triplicate    Excess
  or more !!               photocopying

 Unnecessary             Overly fancy
  meetings                 presentations


                                           13
# 8 - Inappropriate Systems

 Record keeping

 Remove waste before automating
  anything

 Include manual as well as computerised
  systems


                                           14
If the above waste are ignored….

 Higher operating costs

 Higher production costs

 These costs will eventually be passed on
  to the customers….and

 You loose them to your competition
                                             15
How can this waste be removed ?

 Start with TOC, SDCA and then to PDCA

 Solved through “Lean Thinking”

 “Lean Thinking” = elimination of all forms
  of waste from an operation

 Utilise = Lean, Kaizen, JIT, Jidoka and 5S
                                           16
Where does one start ?
 Theory of Constraints (TOC)

   There is a single point in any process operating at
    100% capacity

   Making improvements anywhere else will not improve
    overall flow

   Thus, start at the bottleneck


                                                          17
“Computers may save time but they sure
 waste a lot of paper. About 98 percent of
  everything printed out by a computer is
    garbage that no one ever reads.”

                                - Andy Rooney




                                             18
Good Luck
http://www.linkedin.com/in/anandsubramaniam




                                              19

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Muda in service industries

  • 1. Muda in Service Industries “Why so many systems & handoffs – vertical / horizontal ??” Anand Subramaniam
  • 2. “Why waste time learning, when ignorance is instantaneous? ” - Bill Watterson 2
  • 3. Increase Velocity by Waste Elimination Speed Flexibility = + Cost 3
  • 4. Why Eliminate Waste ?  Don’t throw money away $$  Keep customers– cheaper to retain than to acquire  To avoid high operating and production costs that are ultimately passed on to the customer  To maximise opportunity to have a significant financial impact on the business 4
  • 5. Service Waste - NVA 1. Information 2. Energy and Water 3. Defecting customers 4. Untapped Human Potential 5. Materials 96% Non Value Add 6. Customer Time 7. Service and Office 8. Inappropriate Systems 5
  • 6. Types of Service Waste 1. Information 5. Materials 2. Energy and Water 6. Customer Time 3. Defecting customers 7. Service and Office 4. Untapped Human 8. Inappropriate Potential Systems 6
  • 7. # 1 - Information  Should not take very much time  Should not require double checking  Figuring out what to do and when to do it 7
  • 8. # 2 - Energy and Water  Fixing leaks  Shutting down the machine  Turning off a dripping faucet  Shutting off unnecessary lighting 8
  • 9. # 3 - Defecting Customers  Loss of existing customers resulting from:  High costs  Poor quality  Poor service  Late deliveries 9
  • 10. # 4 - Untapped Human Potential  Create / develop thinking people  The power of using the thoughts of all employees; not just managers 10
  • 11. # 5 - Materials  Recovery, remanufacturing, and recycling  Conserving materials during design, manufacture, customer usage, and more 11
  • 12. # 6 - Customer Time  Forced to wait in value-adding services  Customer inconvenience: waiting for a delivery or traveling for a service not offered locally 12
  • 13. # 7 - Service and Office  Wasted food  Excess emails  Copies in triplicate  Excess or more !! photocopying  Unnecessary  Overly fancy meetings presentations 13
  • 14. # 8 - Inappropriate Systems  Record keeping  Remove waste before automating anything  Include manual as well as computerised systems 14
  • 15. If the above waste are ignored….  Higher operating costs  Higher production costs  These costs will eventually be passed on to the customers….and  You loose them to your competition 15
  • 16. How can this waste be removed ?  Start with TOC, SDCA and then to PDCA  Solved through “Lean Thinking”  “Lean Thinking” = elimination of all forms of waste from an operation  Utilise = Lean, Kaizen, JIT, Jidoka and 5S 16
  • 17. Where does one start ?  Theory of Constraints (TOC)  There is a single point in any process operating at 100% capacity  Making improvements anywhere else will not improve overall flow  Thus, start at the bottleneck 17
  • 18. “Computers may save time but they sure waste a lot of paper. About 98 percent of everything printed out by a computer is garbage that no one ever reads.” - Andy Rooney 18