Hindrances to value creation
Waste occurs in every business, but the real problem is that it is often not recognized as such. In Japan they are referred to as muda and are the first obstacle to an organization's productivity.
A process that runs slowly costs more, has lower perceived quality and worse customer delivery. To make a process fast, obstacles to the flow of the flow must be removed, thereby achieving a reduction in waste and thus a positive impact on costs.
The obstacles identified by the lean system are of three types, the 3 MUs:
- muda: a Japanese term meaning waste, it represents everything that is useless.
- muri: the overload-whether of work, resources, people or other. It appears when the required operations exceed the load that the process could support under optimal conditions.
- mura: the irregularity. It is a combination of muda and walls, of moments of waste and moments of overload. It is in the irregularity that we identify the origin of waste, due to the fact that an important concept in the lean system is the stability of production systems-all the opposite of mura.
Mura, the source of all waste
As mentioned above, mura are the irregularities that give rise to waste; to combat them and build stable production systems with consistent process parameters over time, it is necessary to understand their causes.
The 3 main causes of mura are:
- Non-quality, such as producing faulty output. This generates muda and overloads, as you will have to rush to retrieve the discarded part and catch up with production.
- demand demand, which can lead to fluctuations between overloaded and unsaturated periods. For most products, proper demand and supply chain management can limit this variability and make it acceptable.
- The lack of standardization of products, which within the organization amplifies the disruptions present outside.
Muda: the 7 wastes
To recognize muda, it is first necessary to have the understanding that there are two types of activities in a process: VA - value-added activities that create perceived value for the customer - and NVA - non-value-added activities. Muda are the activities that do not create value for the customer.
Classical lean theory identifies seven types:
- Overproduction: producing more than what is needed at the next stage of the process, or producing before the actual need.
For example: in the factory produce more parts than the customer actually requires; in the office create unnecessary reporting.
Overproduction muda is the opposite of just-in-time, which aims to give what is needed, when it is needed, in the quantity and at the place where it is needed. It is the most dangerous waste because it can cascade all the others: producing excess parts generates inventory, waiting, transportation, and incorrect processes. Moreover, it is particularly insidious because it contains the risk of defect propagation throughout the system.
- Attention: inactivity of processing or transforming resources (e.g., machinery or people) that may be due to material depletion, equipment failure, delays due to batches awaiting arrival, to lack of expertise that takes time to fill the gap in an operator.
Practical examples: in the factory when an operator remains idle beside a machine during the processing cycle of an automated plant; in the office when an employee has to wait from a superior for an approval signature on a document.
- Transportation: is the movement of resources before, after and during their processing. Any unnecessary transportation increases costs without adding value, as well as increasing the risk of damaging products or losing them.
Examples: in the factory, the transfer of components from a warehouse to the production line; in the office, the movement of data via physical media, such as Usb sticks and hard drives, or via the Web.
- Incorrect processes:is an inconspicuous muda, which is why we tend to forget about it; a wrongly thought-out process is wasteful and in turn generates other waste.
For example: in the factory perform acceptance checks when a supplier already guarantees defect-free products; in the office forward a purchase order to a supplier based on a sales order entered with incomplete information.
- Stocks: accumulations of resources to be transformed, in transformation, or processed. Stockpiles, among other things, lead to hiding problems, preventing the team from addressing and solving them. Accumulating inventories is the easiest way to guard against inefficiencies and process contingencies, almost as if they were insurance against errors and defects. For the company, however, they are wasteful and therefore a cost.
Stock times: in the factory, excessive amounts of semi-finished goods between stages; in the office, the presence of batches of paperwork waiting to be processed.
- Movements: any movement that is unnecessary or done in the wrong way. Unlike the transport muda the movement muda does not refer to products but to workers and machines.
For example: on the factory floor, an improper arrangement of machinery and equipment in a production line generates excessive movement by workers; in the office, searching for a file in a cluttered desktop wastes much more time than a standardized and clear structure of virtual folders.
- defects: the generation of defective output, i.e., not adhering to the client's request or technical specifications. Some defects make it necessary to remake the product, increasing its production cost.
A defective product delivered to the customer leads the customer to reject it and prospectively may push the customer toward another company. In the office, missing or incorrect data in the system are considered defects. Sending a customer an incompletely completed invoice, for example, makes it necessary to repeat the transaction delaying payment for the service provided.
Not all muda can be eliminated, however, they should always be identified as waste. Knowing how to distinguish between value-added and non-value-added activities is the first step toward lean transformation. If you cannot eliminate a muda you can learn about it, analyze it and limit it as much as possible.
The waste reduction (muda), management of overload (muri) and minimization of irregularity (mura) are key objectives for organizations aiming to increase their competitiveness in the market and meet customer needs through efficiency, quality and reliability of their processes.