→ The 8 Wastes of Lean: Part 5 – Overproduction
The 8 Wastes of Lean: Part 5 – Overproduction
1 March, 2017
| 2 minute read
Whether you make toys, baked goods, or any other product, producing more than you need, or producing items before they are needed, can lead to significant losses. It can also result in the excessive use of packaging supplies such as cardboard boxes and packaging tape. No matter what product you are selling, having excess inventory sitting on the factory floor waiting to be sold is money down the drain.
Learn more as Signet explores the fifth of the 8 wastes of Lean: Overproduction
Overproduction involves one or both of two actions: producing more of a product than you are selling at any point in time, or producing products before you have actually received any orders for them.
Overproduction is problematic for a number of reasons. Producing more than is needed means investments are not being rewarded immediately. Having products waiting to be sold means time and money is being wasted while you wait – or they may never sell.
While other forms of waste tend to involve the whole company, Overproduction is generally limited to the production line. However, you may have production lines within your company that aren’t immediately obvious. Overproduction of marketing materials, training booklets, or even a staff morning tea all cause waste.
While efficiency is part of any successful business, it is important to remember that it is not necessary to always be producing to maximum levels. Even if a factory is not working at full capacity at any one moment, there are always other tasks that can be completed in the meantime.
So, what can be done to reduce Overproduction?
Here are a few actions that can be taken that will help your company lessen Overproduction and become Leaner and more efficient:
- Use a “pull” production system. Instead of producing items in the hope of people buying them, make your items to order.
- Know the rate at which tasks need to be completed to perfectly meet demand.
- When there is a lull in demand, take the time to complete secondary tasks. This could be training new staff, packing cardboard boxes, maintaining machinery, or any other task that could not be done while your business is producing at full capacity.
Overproduction can be a difficult waste to eliminate. However, once you have identified that your company is overproducing, using pull production systems or a timing analysis can help optimise your output levels. Once the waste has been reduced, costs will be saved, and more time can be spent growing your business in other areas.
Join us again next month for tips on how to reduce the next of the 8 Wastes: Overprocessing.