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The Seven Wastes


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Value" is any action or process that a customer would be willing to pay for. Lean manufacturing is a management philosophy focused on the reduction of the "seven wastes in" order to improve overall customer value.

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The Seven Wastes

  1. 1. 14/07/2009 Topics on Quality, Lean Manufacturing and Productivity Improvement THE SEVEN WASTES Presented by JORGE ROS Lean Definitions  Waste: Anything other than the exact amount of equipment, materials, parts, space, and workers' efforts that are absolutely essential to add value to a product.  This is: Everything that increases production costs without adding value to what is being produced.  Value-Added: Anything that the customer wants and is willing to pay for it.  Non-Value-Added: Anything that the customer doesn't wants and won’t pay for it. CUSTOMERS WILL ONLY PAY FOR THOSE THINGS THAT HE NEEDS AND ITS USEFUL FOR HIM. ANY OTHER THING WE DO IS A WASTE, A DISPEND OR WHATEVER WAY WE WANT TO NAME IT. ¿WHO PAYS FOR IT? 1
  2. 2. 14/07/2009 The Toyota Production System The Toyota Production System definition states that it is: “A philosophical approach to business that is based on satisfying the customer (internal or external) by producing quality products that are just what they need, when they need them, in the quantity required using a minimum of materials, equipment, space, labor and time (in summary: To eliminate wastes).” Lean System Components PHILOSOPHY: To Eliminate Waste, Human Development, Teamwork, Quality, Continuous Improvement, Problem Solving, JIT, etc. TOOLS: Kanban, TPM, 5-S, Mistake proofing, Cellular Manufacturing, One Piece Flow, Quick Changeover, Standardization, Value Chain Mapping, etc. ACTION: Problem Solving, Brainstorming, Root Cause Analysis, Implementation, Process Improvement Teams, Training & Learning, etc. 2
  3. 3. 14/07/2009 Lean Philosophy Basics: for a new Culture  JIT - Build to order. Produce  CUSTOMER FOCUS - only what is needed. Satisfy customer needs.  QUALITY - Don’t pass a bad  TRAINING - Everyone part to the next process. knows what is normal or a special variation.  STANDARDIZATION - Standardize processes.  COMMUNICATIONS - Communicate all useful  LEAN - Eliminate all waste. information in a usable form. Lean Philosophy Basics for a new Culture  PRODUCE WITH QUALITY  VOICE OF THE CUSTOMER –Think of a production system, - Learn from customers. not a quality system  MORE TRAINING - Team  INNOVATION - Try new ideas. training & Problem Solving. Change. Improve.  KAIZEN - Continuous  TEAM WORK - Everyone Improvement (PDCA). participates. Management  PROCESS ORIENTED - supports workers. Focus on the process not the results. 3
  4. 4. 14/07/2009 The Seven Wastes 1. Overproduction. 2. Wait Time. 3. Transportation waste. 4. Processing waste. 5. Motion/Movement waste. 6. Inventory waste. 7. Defects waste. Overproduction Producing more products than is needed, faster than needed or before they are needed is a waste. Adding extra units to the quantity needed “just in case” or building to a pre-defined lot or batch size is also wasteful. 4
  5. 5. 14/07/2009 Consequences of Over-Production  Loss of Production Control.  Fixing rejects becomes a low priority.  Increased Mix-ups, mistakes and confusion.  Valuable time and resources consumed (wasted) building products that are not a priority. Overproduction Causes • Poor Planning Process. • “Just-in-case” instead of “Just-in-time” production. • Poor communications between departments. • Low Capability Processes, that are unable of producing the quantity and/or quality required in a consistent basis. • Prolonged setup and cycle times. • Sub-optimization caused by local optimization (Processes that benefits a single department’s interests against the organization’s interests). • Low equipment reliability. 5
  6. 6. 14/07/2009 Wait Time Wait time waste occurs when a worker cannot proceed with the next task in a process. There are workers waiting and doing nothing (wasting their time or making others waste theirs) while others workload is excessive. Wait Time causes  Lack of an adequate maintenance.  Need of proper tools or materials.  Lengthy setup times.  Lack of cross training.  Lack of SOP or undocumented work methods.  Production bottle necks.  Irregular distribution of training. 6
  7. 7. 14/07/2009 Consequences of Wait Time waste • Personnel that cost doing nothing (adding no value). • Delays that lead to overtime to conclude what was programmed. • Costs due to inefficient processes that exceed the standard costs. • Loss of motivation; Low morale. Transportation Waste Any material movement that does not directly support immediate production. When product is transported to a place other than the next process location or, the next process is not located adjacent to the current one. 7
  8. 8. 14/07/2009 Examples of Transportation waste  Units are parked off the production floor to gather a “full lot” for a batch operation.  Production Lots that are sent off to the other side of the plant for the next process step.  This can occur, either between operations or within an operation where workstations are not properly laid off.  Containers that are too big and difficult to open or close.  Excess of material handling equipment. Lift-trucks that travel empty. Transportation waste causes • Improper Facility Layout • Large buffers . • Large lot purchasing or processing. • Poor production planning. • Poor scheduling. • Poor work place organization. 8
  9. 9. 14/07/2009 Processing waste Any unnecessary step, either production or communication, that adds no value to a product or service. Occurs when we execute an operations, and the customer is not willing to pay for what is being done. Processing waste causes  Lack of a concurrent design.  Processes poorly documented (Lack of SOP’s).  Lack of customer input concerning requirements.  Poor configuration control.  Quality Standards not related to customer needs.  Redundant inspections and approvals. 9
  10. 10. 14/07/2009 Consequences of Processing waste • Time spent building a feature that is irrelevant to the customer and that the customer will not pay for. • Additional costs for materials used in excess. • Lack of control because improper use of design documents. • Products that either, exceed the requirements of the customer or fail to comply with them. Motion/Movement waste Any movement of people which does not contribute to add value to the product or service. Persons moving from one place to another create a false impression of being working, while in reality, are doing nothing. They are costing while adding no value. 10
  11. 11. 14/07/2009 Consequences of Motion/Movement waste  Employees move from one workstation to another, doing nothing.  They are unnecessary trips.  No value is added during this process.  Include time spent looking for parts, tools, fixtures, etc.  Include time spent going to/from a warehouse. Motion/Movement waste Causes • Ineffective Layouts (equipment, office and plant). • Lack of Visual controls. • Poor Process Documentation. • Poor work place organization. 11
  12. 12. 14/07/2009 Inventory waste Any supply (Materials or Goods) in excess of what is required to deliver products in a Just-In-Time manner. These parts will need to be processed, moved, counted, stored, etc. Will add to costs and can not be shipped to our customers. Inventory waste causes  Poor sales forecasting (Demand Forecasting).  Long lead times (set-up and cycle times).  Poor inventory planning.  Poor inventory tracking.  Unbalanced production processes.  Processes that can not produce the required quantity or quality of products in a consistent manner.  Suppliers that can not supply the required quantity or quality of products in a consistent manner. 12
  13. 13. 14/07/2009 Consequences of Inventory waste • Large lot purchases of raw materials, only to be stored for weeks or months. • Very large WIP’s inventories. • Low inventory turnover. Need of large working capital to finance inventories. • Damaged Products. • Obsolete products. Defects waste Costs due to sorting, repairing and/or repairing products. Include cost of materials scrapped due to defects. Also consist in the cost of goods returned by customers, recall campaigns. Recycling part of the products is also a waste. 13
  14. 14. 14/07/2009 Defects waste causes  Too many product models.  High inventory levels.  Inadequate tools/equipment.  Poor employee training.  Poor layouts.  Unnecessary handling.  Poor process documentation.  Processes that can not produce the required quantity or quality of products in a consistent manner.  Suppliers that can not supply the required quantity or quality of products in a consistent manner. Consequences of Defects waste • Excessive processing costs. • Many additional non-value-added processes or operations. • Additional quality control inspections needed. • Damaged relations with customers. 14