When I first arrive at a new clientÃ¢â‚¬â„¢s facility I typically find the following:
- Confusion and disorder
- Too much inventory, raw material, WIP and Finished Goods
- No obvious, visible product or process flow
- People and material waiting
- Disconnection between customer requirements and the Ã¢â‚¬Å“supply mechanismÃ¢â‚¬Â
- Ineffective communications
- High scrap and rework
- Poor training
- Less than 1% value added time
Yes, that is 99+% of the time, the product or service is waiting for value adding attention.
Typically, we do not get paid (or cannot invoice) until the product or service is complete.
That means our cash-to-cash cycle is being increased!
How can this be?
What is in the way of improvement?
The answer is waste or MUDA. If we are clear that this is the enemy we can begin to focus our efforts on identifying and eliminating waste, which, quite frankly, often is our process. Taiichi Ohno, founder of the Toyota Production System, succinctly said: Ã¢â‚¬Å“All we are doing is looking at the time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing the non-value-added wastesÃ¢â‚¬Â.
First, purchase a copy of Bruce HamiltonÃ¢â‚¬â„¢s video Ã¢â‚¬Å“Toast KaizenÃ¢â‚¬Â (Greater Boston Mfg. Partnership (617) 287.7648). One of the best, most practical lean videos I have every watched, Bruce walks us through the process of making toast, with wonderful examples of waste and simple improvements that have huge impact. Use it to train, provoke thought or encourage questioning existing practices. On Gemba (Ã¢â‚¬Å“where the action takes placeÃ¢â‚¬Â) Bruce talks of Ã¢â‚¬Å“direct observation as the most effective means of identifying waste. ItÃ¢â‚¬â„¢s been claimed that Taiichi Ohno trained by drawing a chalk circle on the floor in front of a machine and instructed the trainee to stand there until he or she had an improvement to suggest. Whatever you do, recognize that waste is costing you money and only you and your team can implement counter-measures.
Then go Ã¢â‚¬Å“muda huntingÃ¢â‚¬Â…
- Inventory excess/storage
- Unnecessary motion
- Process inefficiency
- Transportation (parts and materials)
- Underutilizing people Ã¢â‚¬â€œ skills, experience, creativity…