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IndustrialManufacturing Process Improvement: Eliminating waste in over-production
Of all seven forms of waste (Muda) in Lean manufacturing, over-production is the worst. It often hides the other types of waste, and it is one that many people mistakenly believe is actually a benefit to their company.
Why is over-production a form of waste? If you have huge piles of inventory stacked up in your shop, or shelves of finished goods in a warehouse, then you have created a lot of waste. The way inventory is traditionally measured, it counts as an asset. However, if you take the time to think about it, inventory actually represents a loss. You’ve spent time to produce it (and paid your employees for their labor) and you purchased parts or raw materials to create it. All of that cost you money. Until you actually deliver it to a customer, and receive payment, it is an expense. Besides the expense of production, you may end up paying for space to store it, and employees to manage it. How to detect over-production This is one of the easiest forms of waste to detect. Walk around the factory floor and see wherever you have piles of parts, raw materials, work in progress, or finished goods. If you’re constantly ordering shelves, or renting warehouses, because you’re running out of space to store your work in progress or finished products, you know that you have a problem with over-production. How to reduce the waste from over-production The most efficient way to eliminate over-production is to use a “pull” system for your production scheduling. When you do this, you focus on what needs to be delivered to the customer, and work your way backwards through the production steps, with each workstation only producing what the next workstation needs, and can process. This way, you are not creating an inventory of parts that aren’t needed yet. When using a pull system, you do need to allow for a bit of a buffer of excess parts. This well let you handle any emergencies that happen. However, you do not need to have days of work in progress sitting around. If you’re starting from a situation where you already have inventory piling up at your workstations, pull parts and materials from inventory before having more parts produced. If you find that you are frequently late delivering your products to your customers, even though you have a large inventory, then you know that you have not allocated your resources efficiently. That is a sure sign of the waste of over-production. Summary Remember, you are only paid after you deliver the finished product to the customer. While you may think that having a large warehouse full of finished goods will make it easier for you to quickly deliver products, you need to also consider that these items may become obsolete. They also may sell slower than your other products. If you had not spent time, resources, and money building the items sitting in your warehouse, you could have been making products with immediate customer demands. You can talk about... Manufacturing Process Improvement: Eliminating waste in over-production Tags: • production steps • shelves • renting warehouses • factory floor • over production • manufacturing • production scheduling • how to • receive payment • raw materials • lean manufacturing • manufacturing process • work in progress • Related articles:
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