METHODS
Waste is any kind of activity that uses resources but does not increase value for the customer. Therefore, the elimination of waste offers companies the opportunity to reduce costs and increase the efficiency. In the classic Lean-Production-Doctrine Lean-Production-Doctrine, according to Taiichi Ohno, the father of the Toyota Production system, seven types of waste are classified that do influence each other. These can easily be memorised using the mnemonic TIMWOOD.
| T | = | Transport |
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| I | = | Inventory |
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| M | = | Motion |
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| W | = | Waiting |
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| O | = | Over-production |
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| O | = | Over-engineering |
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| D | = | Defects |
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Transport
Whenever material is transported, costs for personnel and energy are incurred and no added value is created. Hence, it should be checked if transport distances could be shortened or avoided by e.g. placing workstations or by pulsing and linking work steps.
Inventory
Inventories are an important part within the entire value chain: initially as raw materials, then as "Work in Process" (WIP) and finally as finished products. However, inventories over and above the current needs are waste, as they cause costs in logistics and tie up capital. Standardised and stable processes reduce the necessity of high inventories and reduce waste through transport.
Motion
Unnecessary movements such as handing of tools, or walking to a material dispensing station, lower the productivity, can cause poor posture and thus strain the musculoskeletal system of the employees. At this point ergonomic principles in work place design must be acknowledged in order to increase the efficiency of employees, and to avoid work accidents and loss of quality. The consequences of unnecessary movements often are waiting and transportation.
Waiting
Waiting for e.g. the end of a processing cycle of a machine or the unscheduled waiting for material replenishment or because of a disruption is waste, as no value is added during this time. The most severe impact is the increase in the lead-time for manufacturing the products. Waiting times can also influence the motivation of - under-utilised- employees. They can be avoided by better process planning, but can also be bridged by multi-station handling or job enlargement of the employees
Over production
Over-production production counts as waste, since more is produced than is purchased, resulting in inventories and therefore respective costs (warehousing and inventory management) and liquidity losses (due to tied up capital). Despite the value creation, it is not certain, whether the goods can be sold and thus become turnover relevant for the company. The cause, on the one hand, is often the so called "optimal batch size", in which the ratio between the set-up costs and inventory costs for pending production orders is (in many ERP/MRP systems automatically) optimised - even if there is no real sales for the calculated quantity. The reason on the other hand is the optimisation of capacity utilisation, since investment intensive machines and plants should not be unproductive if possible.
Wrong processes/ technologies
Waste is caused by outdated or immature processes as well as by over-engineering. Processes or manufacturing methods without necessity for the finished product become overly complex. Therefore, processes should be reviewed, continuously improved and modernised in order not to waste resources and to increase production.
Rejects/rework
Rejects or rework due to lack of quality is obviously waste, as the value creation has already (partially) been completed when the product is identified as faulty by inspection. The causes often are malfunctioning machines or employees making mistakes, defective third-party components or uncalibrated measuring tools. The goal is to eliminate the cause, reduce the reject rate and provide the desired quality.
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