Waste can take many forms. There is waste of time, material, human resources, etc., all of which result in a waste of money for the business and its customers. Time and material is easy to understand, even if not always easy to see. The waste of human resources is more insidious.
Everything is interconnected and waste is usually found to be both the result of other waste and the cause of other waste. The ability to see both the big picture and the little picture at the same time is important. Fixing waste in one area that creates waste somewhere else is called sub-optimization and is counterproductive. Solid leadership and a shared vision will save the day in any waste reduction initiative.
There is a relationship between the eight wastes we have all heard about and the 5-S tool we have also heard about. In this brief post, I will try to explain how 5-S can address all seven wastes. Let’s start with a description of the seven wastes.
- Transport: Un-necessary movement of material for production.
- Inventory: Raw material, work in progress, and finished product not being processed.
- Motion: Un-necessary motion of people or equipment.
- Waiting: Raw material, work in progress, and finished product not being processed waiting for the next process step.
- Over Production: Production ahead of demand.
- Over Processing: Poor process, tool or product design that creates activity that is not productive.
- Defects: Inspecting for or correcting defects anywhere in the process.
- Under Utilization of Human Resources: Under-trained or under-utilized employees
5-S is not just a tool to makes things look better. This tool will also make things work better and produce less waste. Like all tools it must be calibrated to the situation. If you understand the wastes being produced in your processes or business, 5-S can be made to target these wastes and wipe them out. So what are the 5-S’s?
- Sort: Necessary vs. un-necessary material, data, equipment, etc. Prevention of cleanliness and mess producing problems. Addresses wastes 2, 5, 7
- Set In Order: Place for everything and everything in its place. Addresses wastes 1,3, 4
- Shine: Clean work space. Addresses wastes 2, 4, 6
- Standardize: Rules to standardize the sort, set in order, and shine efforts across the work space. Housekeeping, inspections, and workplace arrangement are shared and used across the work place. Addresses wastes 1,2,3,4,5,6,7,8
- Sustain: Culturalize the standards so as to eliminate the root causes of problems in the other 5-S categories. Addresses wastes 1,2,3,4,5,6,7,8
In order to use the 5-S tool correctly, the improvement team will calibrate it to the processes and areas where it is being applied. Applying 5-S to an office setting will have a completely different look and feel than applying the tool to a manufacturing floor. As the team looks for waste they also adjust the 5-S tool to directly address specific aspects of the work space.
As waste is reduced and the work space becomes more standardized, hidden waste producing activities become more visible. This is why the 5-S tool is considered cyclic. The new wastes are addressed as they are discovered by the initial 5-S iteration. At the same time, the team will document larger issues that will require a more focused Six Sigma team effort later.
The result is reduced cycle time, reduced inventory dollars, increased productivity, and increased utilization of resources. The business will see increase profit directly to the bottom line as a result of satisfied customers. This is because the customer’s perceived value of the product or service increases and the inherent value born by the producer decreases. When you plug these value changes into the profit formula below, good things happen.
Profit = Perceived value (customer) – Inherent value (cost to deliver).
See my book, “Lean and Mean Process Improvement”, for more information.