Streamlining Your Processes

Every process that you currently carry out within your business (or personal life for that matter), can be broken up into 3 main functional categories: Value added, Non-Value added, and Waste. The goal in improving your processes is to keep value added tasks, optimize non-value added tasks, and reduce wastes to an absolute minimum. Let’s have a look at what these categories consist of. 

Value Added - These steps in a process consist of anything a client is willing to pay for. Typically, these actions that increase or improve fit, form, or function. When you are applying soaps and chemicals to a house, roof, driveway etc., this is value added. 

Non-Value Added - Any tasks that you perform that are required (typically laws, or regulations) but do not directly add value to your end product/service.

Waste - Waste is anything that is not value added, or required. A lot of times, wastes in processes seem like they can never be 100% eliminated. Remember, the goal is to continuously improve. You don’t have to get rid of 100% of your process wastes, I’m telling you right now that companies like Toyota who created these philosophies and techniques still identify wastes in their processes. They just continuously focus on reducing these wastes as mush as possible. Think of any reduction in waste as an opportunity for improvement. There are 7 categories of waste: 

    1. Waiting - As implied, any time you are waiting for material, information, or people to move to the next step in a process. Increasing the lead time form the start of your process to the end is lost opportunity to generate revenue in the time you’ve spent waiting.
    2. Over Production - This is when you create more than what is required, perhaps to use up materials, or to fill extra time in a shift. This is a waste because you may need the materials in another order down the road, you may be taking up space with non-required finished goods, or a design may change that renders your extra parts irrelevant and now scrap. 
    3. Over Processing - When your process includes “extras” that are not required to meet the fit, form, or function of the product/service the customer is expecting. These additional touches may be perceived as value added, but if they are not part of what the customer wants, then you are spending time and money without a return. This is not to say going the extra mile to satisfy a customer is a bad thing, we at Big Shot do it all the time. Just know that the classification is waste when considering the technical definitions.
    4. Excess Motion (operator) - Any time you are in motion, and not adding value. Having to walk back and forth between your truck and equipment, moving around the outside of a house multiple times when you only need to cover each side once. These are examples of excess motion. 
    5. Excess Transportation (materials) - Similar to excess motion, excess transportation is when parts, equipment, or materials are moved around in excess. If you trace this movement, would you see a messy spaghetti pattern? Do you think that predetermining the steps of your process to configure the path of your equipment in a more efficient line, curve, or circle (or at least on that doesn’t cross itself multiple times) would decrease the time and effort of completing your task? Of course!
    6. Excess Inventory - Having too much inventory takes up space in your house, shop and work vehicle. Not to mention the effect it has on your budget. The key is to determine how long it takes to replenish inventory, compared to rate you consume the inventory to determine appropriate stock levels. Of course, this is a very vague high level explanation as things such as bulk discounts and seasonality, available storage space, lifespan of goods etc can play a part in your decisions.
    7. Rework/Scrap - Any time you perform a task that does not meet the required fit, form, or function of the product or service your customer is willing to pay for, you must do it again. This results in scrap materials, extra product costs, and lost opportunities that you would have had if you weren’t performing the same task for a second time. 

    "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 the time line by reducing the non-value adding wastes."

    - Taiichi Ohno, Founder of Toyota and the Toyota Production System

    For further information on how to identify and eliminate waste and other problems in your business processes, please visit our "Root Cause Analysis and Problem Solving" Blog

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