– Doing something wrong or breaking something: Burning the toast. Making something that's not in compliance with the required specification.
Inventory – Actually should say “excess inventory”, products or materials waiting to be used: Car dealership forecourt full of cars for sale. Five cartons of milk in the fridge.
Transportation – The product version of Motion above, products being moved around: Products in trucks moving from the manufacturer to the warehouse or on to the store. Passing the salt around the table at dinner.
Figure 2 The 7 Wastes
It's also worth mentioning that some texts quote a further, eighth waste: the misuse of capacity or resources. My belief is that this is a consequence of the other wastes rather than a waste in its own right, but that's just my opinion.
When looking for waste, you need to be absolutely ruthless, there's no room for sentiment here. If there isn't a clear and direct line of sight to customer value, then it's waste; sorry, but there you are. When you start pointing this out, you are going to become very unpopular very quickly, so it's best to prepare your audience before setting out. As a rule of thumb, 90 %+ of everything a business does is waste. If you're not seeing this, then you're either not looking hard enough or you're being too soft. Once you understand this and manage to get your leaders understanding it too, huge improvements in performance are possible. Having said that, not all waste can be eliminated. There are two types to consider. Type 1 waste is that which is associated with doing your business, such as the company accounts or QA testing. While it can't be totally eliminated, you should look for ways to pare it down to the absolute minimum, but recognise that while it is unavoidable, it's still waste. You'll get into some very heated debates with your Head of Quality over this last one, but testing adds no value to the product if it was made properly in the first place – sorry, but there you are! The other, Type 2 waste, usually more than 60 % of the total, adds no value whatsoever to anyone and is not required to satisfy any external regulation or need. This waste should be eliminated and the resources used for something more useful.
Sounds simple, but it's not. Persuading a large number of people that the majority of what they do on a day-to-day basis amounts to waste is hard, both for the message giver and the message receiver. Over the years, whole departments have been created to generate and distribute waste, which others use to generate more waste, and so the cycle goes on. At the risk of getting locked up for treason, just look at governments of countries for outstanding examples of this. Breaking this will be one of the hardest things you will have to do, as you will be butting up against company hierarchy and politics.
In this section I will leave you with one final comment on waste. Your most precious commodity is time. Time marches on relentlessly and once gone, you never get it back again. Ensuring time is not wasted must be the number one priority. If you think about it, the implications of this are quite profound. As someone who is getting on a bit now, I really am beginning to understand the meaning of this in every aspect of life.
Variation is the killer of Lean processes: it generates so much waste planning for it, trying to quantify it and buffering against it. All of which is treating the symptom, not the cause. This is where our friend, Six Sigma, comes into play. The Six Sigma suite of tools provides a systematic approach to defining, measuring and analysing variability and then designing and implementing changes to reduce and control it. This was codified into a method by Motorola in the 1980s under the acronym DMAIC (Define opportunity area, Measure current performance, Analyse opportunity potential, Improve performance, Control performance). Again, at the risk of sounding evasive, there are many books on the subject written by people far more versed in these tools than me. If you really want the full works on this you can do worse than getting your hands on a copy of one of Michael L. George's books, founder of The George Group. Briefly however, in principle it works like this:
Firstly, identify an area that is not performing well, or where there is a specific problem that needs fixing. This needs to be agreed and sponsored, as there needs to be real commitment to fixing it.
Secondly, spend some time understanding how the area you are trying to improve works and get some real data on performance at each step of the process. It is important that this is done properly as it is the basis of all to come. This means that you need to take the time to get a statistically relevant sample, taking in the true variability of the process.
Thirdly, analyse the data to understand the root causes of the behaviours that the process is exhibiting. It's important not just to focus on the down side; it's just as important to understand the causes of good outcomes so they can be replicated. There is a whole host of tools and models available to do this.
Fourthly, figure out how to improve performance or fix the problem and implement the solution (Ha! That sounds simple doesn't it? In practice it can be far from it).
Fifthly and finally, put measures, controls, accountabilities and fail-safe mechanisms in place to stop everything sliding back to the old ways.
I'm sure there will be many Six Sigma black belts having palpitations and fuming after reading this very brief explanation. If you are one of those, please be assured that I'm in no way trying to downplay the importance or effectiveness of this method for turning around performance. As will be discussed later, Six Sigma and Lean are good friends and, indeed, should be blended in any broad improvement programme.
Variation can kill the process, but much variation can be eliminated by applying some simple discipline into the way activities are carried out without the need to resort to some of the more powerful tools mentioned above. Empowerment is a much overused buzzword these days and I keep hearing how “everyone needs to be empowered”. While this might be true, if not done with a little discipline, all you end up with is a free-for-all and everything gets out of control. If the ways of working are inconsistent, the outcomes will be too. This is a problem for any business, but if you operate in any of the numerous regulated industries, it's a major issue, hence the enormous quality management departments in many of these businesses. There has to be “one right way” for everything. However, if you can't get to the “right” way then at least get to “one way” while you figure out what the “right” way is. This can be as simple as looking around your organisation at all the people doing a particular task and doing a rough evaluation on who does it the best. For production, this is fairly easy as there are probably pretty good measures around. For other tasks, this might be a bit more tricky, but don't sweat it too much, we're only looking for rank, not absolutes, here. Once discovered, get the people from the best group to document how they carry out the task and then teach the rest how to do it. The more difficult issue is then to make sure everyone does it, and sometimes this can involve a real battle against the “not invented here” brigade. Everyone will insist they are different and so-and-so's solution won't work here, but don't be having any of it. If there are differences, get them to prove it; the onus of proof should be on them, not you.
“Ah,” I hear you say. “Doesn't all this standardisation stifle innovation, the cornerstone of continuous improvement?” Not really, but continuous improvement needs to be introduced in a controlled way, not randomly. Once the new way is tested and shown to be better, this then becomes the new standard, hence my message above about not necessarily being “right” right off the bat. By way of an example of what I mean here: Imagine the person replacing the left rear wheel in the middle of a Formula One race having a bright idea about how to do it better and then trying it out there and then. Result, a three-wheeled F1 car exiting the pit lane into the barrier at a high rate of knots! No, these guys follow a well-rehearsed process to the letter; everything has
