Mark Janson Sotto

Learning Objectives
Value-Added Non Value-Added Waste Identify the 7 Wastes

 Value-Added
pay for it

Elements of Work

1. The customer is willing to 2. The activity changes the

product or service towards something that the customer wants

3. The thing must be done

right the first time.

Elements of Work
Non Value Added

- anything that the

customer does not want and wont pay for

Elements of Work
Waste
Muda no value - Anything other than the exact amount of equipment, materials, parts, space, and workers' efforts that are absolutely essential to add value to a product.

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.

Wastes and Non-Value Added

Value Added

Value Added

Value Added

Total lead time through Value Stream

Traditional improvement focus (Make Value Added twice as fast)

Waste elimination focus

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.

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.

_______

Waiting
Waiting 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.

Waiting 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.

Consequences of Waiting
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.

______

Motion 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.

Consequences of Motion 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 waste Causes

Ineffective Layouts (equipment, office and plant). Lack of Visual controls. Poor Process Documentation. Poor work place organization.

_________

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.
consistent manner.

Suppliers that can not supply the required quantity or quality of products in a

Consequences of Inventory waste

Large lot purchases of raw materials, only to be stored for weeks or months. Very large WIPs inventories. Low inventory turnover. Need of large working capital to finance
inventories.

Damaged Products. Obsolete products.

____-__________

Over-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 SOPs). Lack of customer input concerning requirements. Poor configuration control. Quality Standards not related to customer needs.

Redundant inspections and approvals.

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.

_______

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.

Defects waste causes

Too many product models.
High inventory levels. Inadequate tools/equipment. Poor employee training. Poor layouts.

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.

Unnecessary handling.

Consequences of Defects waste

Excessive processing costs. Many additional non-value-added processes or
operations.

Additional quality control inspections needed. Damaged relations with customers.

____-__________

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.

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
departments interests against the organizations interests).

Low equipment reliability.

Talent / Skill

Wrap up
Technical Tools
- Identifying where waste is happening within the processes and eliminate it.

Culture change
- How do we work together as a team to make improvements in the processes ?
- Creating the culture of continuous improvement

Action Plan Competition using Lean Management