Of all the reasons to build a process-driven culture and infrastructure in your organization, the elimination of waste is a very logical and compelling reason. Eliminating waste can feel like Christmas. Your ability to deliver deep savings and performance improvement is a wonderful gift for everyone including the customer.Your prices might even come down! What might that mean for sales? The Lean Methodology – even in its most rudimentary form – is your greatest tool in identifying the waste you must remove from your process. In case you haven’t noticed, the state of the global economy is sort of tugging on your shirt-sleeve to get with the program.
Lean and Mean Metrics
I run across this scenario all of the time in my consulting work:
Client – “We want to get really efficient, Patrick. Help us reduce the waste and improve overall performance.”
Me – “Ok. How are you performing now? What are your key performance indicators and what are your industry benchmarks? How are you doing in comparison to your competition?”
Client – “Huh?”
Your obligation – whether you are the new business analyst on the team or the CEO – is to make sure that you can identify your key performance indicators and perhaps even more granular performance metrics. Otherwise, identifying waste and verifying that you are making progress is kind of tough. This is a science.
Waste: 7 Fruity Flavors
Lean tells us there are 7 types or categories of waste. They occupy a great deal of your time and represent a considerable chunk of your overall cost. Would you be more competitive if you could eliminate the following:
- Overproduction Waste (the biggie)
- Waiting Waste (time in queue)
- Motion Waste (moving stuff around)
- Transport Waste (conveyance that adds no value)
- Over-Processing Waste (processing the customer doesn’t value or pay for)
- Inventory Waste (stockpiles – see Wal-Mart for the antidote)
- Defect Waste (re-work, correcting mistakes)
Value-Add Your Way to Success
Value is defined by your customer. Don’t forget this very important fact. Waste is anything that doesn’t add value. Whether you work for a non-profit, a school, a prison, a high-tech firm, a hotel or a retail store, waste is a big deal. You may think you have built-in features and processes that are wonderful, however, if your customer doesn’t share your enthusiasm and cannot identify the inherent (intrinsic or extrinsic) value, you probably have waste. Get rid of it. Value-Stream Mapping is a great visual aid and a perfect tactic for this purpose but I want to warn you: don’t get lost in the weeds. If you came to my house to find waste, I assure you there a few places you could look first and you’d find 75% of my waste. It’s no different in your shop. Start with the biggest and ugliest offenders. Do it now.
Think and draw from the perspective of your customer. Ensure decision-makers are involved. Invoke tough decision-making processes. Once you identify the waste, the will to eliminate it must be there.
What’s your story? What success story can you share? What did you do and how did you do it?
Thanks for chiming in!