Eliminating waste in business
The purpose of this blog are ideas on how to apply the most advanced business management techniques to personal lives. Thus let us first look at what eliminating waste in business means. The principle is part of the lean production or, more specifically, the Toyota Production System (TPS).
In the lean production, on which the lean startup philosophy is also based, we know of seven different types of waste. Every process either adds value or waste to the production of goods and services. Value in business means any action or process that a customer would be willing to pay for. Lean is about highlighting the things that add value by reducing everything else.
When you eliminate waste, quality improves while production time and costs are reduced. There are many tools for doing it, such as Value Stream Mapping, Kanban, Five S etc. The Japanese word for waste is muda and it is the foundation on which the TPS philosophy (muda, muri and mura) is built.
A very interesting thing that the inventors of TPS found is that that even if products being produced in factories are totally different, the types of waste are very similar.” The situation is no different in our lives. It doesn’t matter what you do or where you live, you have to face similar kinds of waste as other people.
You need a strategy for how to reduce or eliminate the effect of each type of waste. That brings us better quality and performance (productivity).
The seven muda (types of waste) in TPS are:
1.Transportation
2.Inventory
3.Motion
4.Waiting
5.Over processing
6.Over production
7.Defects
We can use the acronym ‘TIMWOOD’ to remember the 7 Wastes of Lean