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“Most Business Processes are 90% Waste and 10 % Value Added work” said Jeffrey K. Liker in The

Toyota way . In our study of over 400 companies, we have verified that fact. We have also found the

extent to which profits are effected by this 90% wasted process.

The best place for any company to begin its journey of getting lean is to create continuous flow

where ever possible in its core manufacturing processes & service flow. The heart of making

processes lean is in shortening the time elapsed to convert raw materials to finished goods

In most batch & queue processes (which is most popular among manufacturers across the globe)

large quantities of standardized materials lie in wait for long periods until they are moved to the

next stage of production. Let us consider the example of a custom made piece of furniture that you

order from a manufacturer. The actual process of making your furniture is likely to take a few hours,

all the rest of the 15 days delivery time that you spend waiting for your product is a waste. This

wasted time involves the time taken by the various departments making the parts such as

upholstery, springs, hinges, nuts etc. Each of these people make large batches of products and

shipping to manufacturers who again pile up inventory. The various deptt of the manufacturer then

pulls out the required raw material from the inventory and assembles your furniture (in a few hours)

which is then shipped to you. Thus delayed production timelines have little to do with quality,

unfortunately

Some exemplary non value adding processes that one must remove from the flow at the earliest are:

  • Over Production
  • Waiting
  • Unnecessary/ repeated Transport
  • Over processing
  • Excess Inventory
  • Unnecessary movement
  • Defects
  • Unused Employee Creativity

Non Value Added Activities are what your consumers are not willing to pay for. These are the

unnecessary activities that are caused due to

  • Lack of strategic planning
  • Non confirming standards of machines or material
  • Lack of compatibilities of men & machines on the shop floor
  • Irregular / unplanned plant layout
  • Poor evaluation standards
  • Lack of performance analysis & evaluation
  • Faulty assessment & estimation procedures
  • Inertia & resistance to change

NVAAs are a major crippling factor for businesses. They are a massive cause for reduced profits, lost

time and inertia. It is hence prudent to note a few ways of getting rid of non Value adding activities.

To know more such insights and a value stream analysis of your business get in touch with The Idea

Smith

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