Continuous improvement and customer-first approaches such as Lean methodology can offer a critical advantage to small and medium-sized manufacturers (SMMs) competing in the global market. In addition to integrating automation with new technology and building a network of strategic partners, putting the customer at the center of process and performance decisions can allow SMMs to stay competitive. 

Success in manufacturing today demands agility and operational excellence, which SMMs can attain through innovative thinking, swift adaptation, and waste elimination - all critical principles in implementing Lean Manufacturing.

What Is Waste from a Lean Manufacturing Perspective?

Lean Manufacturing aims to eliminate any steps within a business or work process that do not create "value" as defined by the customer — when implementing Lean, all tasks performed must be viewed through the lens of value-added work and non-value-added work. Value-added work directly creates the features, characteristics, and benefits that the customer desires and is willing to pay for (e.g., operating the machine that produces a plastic comb). Non-value-added work is made up of tasks that the customer does not care about and does not want to pay for (e.g., material and labor cost from scrap products passed on to the customer in the price of the comb). 

To be considered value-added work, the following criteria must be met:

  1.  Work that a customer is willing to pay for
  2.  Work characterized by change in form or function 
  3.  Work that is performed properly the first time

Non-value-added work primarily comprises wasted time related to inefficiencies, inaccurate planning, and outdated practices that provide no benefits. The customer isn’t willing to pay for work or materials irrelevant to their perception of value. And if significant waste exists in the manufacturing process, they’re more likely to consider competitors that deliver their expected value better.

Lean Manufacturing’s 8 Wastes

Lean Manufacturing has classified waste into eight categories. An easy way to remember them is to employ the acrostic, DOWNTIME, to represent eight different types of waste within companies. 

  • D = Defects
  • O = Overproduction
  • W = Waiting
  • N = Non-Utilized Skills & Creativity
  • T = Transportation
  • I = Inventory (Excess)
  • M = Motion
  • E = Excessive Processing

1.  Defects

The first type of waste is defects in product quality. If a product or service doesn’t perform as expected by the customer, it causes significant waste in the value stream, including: 

  • Defective products scrapped at the quality control stage
  • Products returned to the manufacturing stage to be corrected or reworked
  • Handling product returns

Flaws that get detected during manufacture or inspection can be addressed in-house but may result in more time, money, and resource costs, as well as customer delivery delays. Defects identified after sales or transfers can result in product returns, dissatisfied or lost customers, partial or full refunds, and additional costs or legal action resulting from the customer’s use of a defective product.

Reduce this waste area through two key steps: 

  1.  Source-based quality control: Implement procedures at each manufacturing stage that integrate quality control to avoid wasted time on correcting a defect and assign quality control and reporting at the source. 
  2.  Autopsy finished product defects: For a defective product that passes its final quality check or gets sold, identify the root cause to determine if a change in process, automation, machinery, or staffing is required. 

While investigation and quality control actions require an initial outlay of time, tightening up the way you handle defects and reducing their occurrence altogether is an investment in decreasing long-term non-value-added activity.

2. Overproduction

As with any pendulum, preventing loss of sales based on scarcity and low inventory can swing too far in the other direction. If your products stack up too high, you will see waste through: 

  • Time spent producing materials that don’t result in a sale
  • Redeploying personnel and resources that are being lost to other tasks or production
  • Movement, storage, shuffling, and potentially reworking materials
  • Poor employee engagement and performance

To avoid overproduction, ensure there is clear communication across departmental lines. This simple step helps guarantee each team knows current and upcoming customer demand and adjusts manufacturing processes and production quantities accordingly. Reassign workers to other tasks such as cleaning, administrative catch-up, or research and development rather than generating excess inventory.

3. Waiting

Regardless of the item, information, or service you create, a finished product involves a series of moving parts through a coordinated timeline. While some tasks and activities take place simultaneously, most manufacturing stages rely on a sequential process for completion. Waiting-related waste may include: 

  • Waiting on the availability of raw materials, partially manufactured products, or information required to complete a job
  • Differences in processing time across stages; line imbalances (e.g., if Part B gets done before Part A)
  • Shipping delays
  • Machine repair and maintenance

Ideally, manufacturers complete every step on their production timeline as planned, but compounding issues quickly pile up based on input availability, weather, staff absences, machinery performance, and errors. Reducing the overall waste of time attributable to waiting in queues, delays, and bottlenecks means: 

  • Working to the pace of customer demand and in coordination with both internal and external customers 
  • Training management and staff to quickly identify and communicate timeline issues 
  • Redeploying resources to alternate activities if significant wait delays occur

And when issues arise, manufacturers must first deal with the bottleneck or issue at hand (as much as possible), and then move on to communicate, re-order, and adjust the line or schedule as needed to balance remaining work and meet deadlines.

4. Non-utilized skills and Creativity

Whether it’s talent, willingness, or specific ideas, the fourth area of waste centers on people. When implementing Lean Manufacturing, consider employees’: 

  • Engagement: Do you have committed team members who take ownership of their part in the company’s success?
  • Empowerment: Have workers been given the method and means to put forth suggestions and ideas to improve efficiency and effectiveness?
  • Development: Does the company commit to building skills and training to improve performance? Do you strive to retain and promote within to take advantage of employee knowledge and expertise?
  • Assessment: Do the managers know the workers well enough to understand their individual talents, abilities, and goals? Are those workers given opportunities to utilize their respective skills to help the company? 

Engaging and making space for people to perform their best and improve their skill sets is a win-win solution. Include workers and operators in troubleshooting and planning to improve their areas in order to utilize their firsthand knowledge effectively.

5. Transportation

A well-planned process means removing repetitive or ill-planned transportation or movement of products, information, tools, materials, or people. Movement beyond what’s necessary can lead to: 

  • Poorer performance from poorly calibrated or situated tools and equipment 
  • Product defects and damage
  • Wear and tear on automobiles, equipment, and surfaces
  • Fatigued and irritated workers and contractors
  • Manufacturing process delays

To minimize wasted transport, use tools like spaghetti diagrams or charts to illustrate the movement of each product or service in continuous flow lines from start to finish, entrance to exit. Identify redundancies and inefficiencies and work on streamlining flow through routes, facility changes, processes, and scheduling.

6. Inventory (Excess)

Excess inventory may be a result of overproduction (i.e., Waste #2 ), or it might be due to ineffective forecasting, unforeseen materials shortages or shipping delays, over-purchasing, or problems meeting sales goals. Regardless of the cause, this waste source can result in: 

  • Increased costs for storage management and facilities 
  • Time and temperature changes that compromise the product's function and quality
  • Information and products that age and may become obsolete based on market changes, like seasonality or trends
  • Products being sold at a discount or discarded altogether resulting in financial losses
  • Misallocation of capital that could have been better used
  • A slower production process relying on volatile inventory and poor projections

To solve for excess stock, set up a Kanban scheduling system or a similar project management tool. Along with avoiding excess inventory, following Kanban principles supports quality control and Lean Manufacturing.

7. Motion

Motion refers to the movements within a single workspace or working environment, compared to transporting people and items from place to place, including: 

  • Bending, stretching, and reaching
  • Lifting
  • Walking, sitting, and rising
  • Movement of tools and equipment

Similar to an ergonomic assessment, reducing motion waste starts by observing an individual at work to identify motions and suggest improvements to minimize strain and repetition. This step often includes changing the order, location, or placement of tools and materials and may extend to supplying more ergonomic equipment and supplies.

8. Excessive Processing

Manufacturing processes change significantly over time to reflect industry standards, raw material and equipment availability, government regulations, environmental concerns, and changes in customer needs. Management level changes may receive high-profile attention, but working processes do not always undergo comprehensive re-evaluation simultaneously.

When you work on a Lean waste review and action plan, keep an eye out for any steps or habits primarily based on “this is how we’ve always done it” rather than current manufacturing needs. And whenever work processes change, encourage managers and workers to evaluate the complete set of steps within that stage of work to identify other efficiency opportunities.

Continuous Improvement and Waste Reduction

To minimize waste in your value stream, you must first identify and acknowledge its existence. Teams can get caught up in prioritizing departmental goals over customer needs. 

Lean Manufacturing means putting the customer first, building each step, and deploying resources based on end customer needs. Working backward from point-of-use to the start of the production process will help you to locate, document, and plan solutions for the eight wastes of Lean Manufacturing.

But you don’t have to do it alone! When you partner with CMTC's Lean Manufacturing consultants, you’ll have experts with fresh eyes to evaluate your business processes from the ground up and provide solutions to reduce costs, eliminate unnecessary waste, and increase your speed to market. Contact us today to find out how we can help your business!

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About the Author

Alexander Federici

Alexander Federici has over 15 years of hands-on experience leading companies through Lean Transformations. He develops corporate strategies, delivers leadership training, and works with teams across the organization — from frontline workers to office and executive staff. He has initiated, developed, deployed, and managed Continuous Improvement / Lean programs at major and mid-sized companies in multiple industries.

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