In manufacturing, the only route to success is to manage costs, reduce waste, and increase efficiencies. From a waste point-of-view, here are six tips to successfully reduce waste which will not only reduce costs but it also improve customer service.
- Stop doing those activities that no one uses anymore – for example, it is common to continue spending hours developing reports that everyone deletes upon receipt. Take a step back and figure out which activities add value today.
- Determine your profit drivers before you fanatically pursue a waste reduction program – this sounds obvious but in my experience, it is most often overlooked. Once you understand your profit driver, you’ll know what to focus attention on that will make a significant difference to your business.
- Take a step back and “see” what you are doing – this can take many names including putting together spaghetti diagrams etc, but simply, it is just to focus on what you are doing to see opportunities for improvement. For example, you might find that you are running around in what appears to be circles to gather everything you need to complete a project or to produce a product.
- If focusing on materials waste, there are several routes to pursue, from the typical one, manufacturing line scrap, to material usage to the waste built into product design and packaging design to opportunities in material options and working with suppliers.
- If focusing on labor waste in a manufacturing environment, scrutinize your schedule loading and opportunities for flexible crewing to your crew size for specific items and run rates (however, be careful not to be overzealous on one particular topic to the exclusion of all else. For example, many times, run rates and material usage can have opposite effects).
- If focusing on labor waste in non-manufacturing specific roles, remember your profit drivers! For example, it makes no sense to save labor costs by getting rid of your engineering expert if that person can help you save 10 times their salary in waste reduction. Sounds silly? Believe me, it is common!Another example I’ve seen that flies in the face of sanity is to reduce your technical expertise when your company’s strategic advantage in the marketplace is technology. Although it seems to me that a lot of the frenzy over reducing labor dollars is largely a narrow view, there are times when it makes sense to cut back. The key is to make sure you aren’t caught up in a frenzy of viewing people in terms of the narrow view as labor dollars alone. Instead, look at the big picture and keep your strength in the areas related to your profit drivers, so think before jumping off the cliff!