What is Waste?

Waste is defined as any production-activity, which utilizes resources but does not add any value for the customer.  Since these ‘wastes’ add to the cost of products, they either reduce the profit that manufacturer makes or inflate the price, which is at customer’s expenditure.

In general, customers are not willing to pay for these activities because they do not benefit from them.  Therefore, eliminating waste lends a greater opportunity for businesses in order to cut costs and improve efficiency.  Usually, we refer to seven types of Wastes. These include: transportation, inventory, motion, waiting, over processing, overproduction, and defects.

Elimination of these seven kinds of waste could help companies reduce costs, increase employee engagement, customers’ happiness, and increase in profits.

Type of waste Example What to do
Transportation
  • Movement of materials from one location to another
  • Avoid unnecessary steps in between processes
Inventory
  • Every piece of product tied up in raw material, work in progress or finished good costs money until its sold
  • Do not store extra materials
Motion
  • Unnecessary motions are movements of machines or employees that are not as small or as easy to achieve as possible
  • Make the motions in between the processes easier
Waiting
  • Any idle time produced when two interdependent processes are not completely synchronized
  • Connect processes well, so no time is wasted
Over processing
  • Put more into the product than is valued by the customer
  • Do not do more than what customers want
Overproduction
  • Results from producing more or faster than required
  • Do not produce more than what customers need
Defects
  • Errors that require time to fix
  • Avoid mistakes or the production of bad quality goods