Muda in Lean Six Sigma speak is waste (as with many Lean Six Sigma things, it’s the Japanese word for waste). They are the seven deadly sins of Lean, and the whole point of Lean is to get rid of as much waste as possible. There is muda / waste in everything we do, whether it’s excess material which gets cut off, poor product being thrown in the bin or even just more walking around than is required.
There are 7 types of Waste (Muda) in Lean, and these are:
They are sometimes remembered by their acronym TIMWOOD (who is TIM WOOD?).
Some operations add an 8th:
- Skills / Potential
Excessive movement of goods, people etc. between processes. I’ve seen many examples where a facility involves moving people and goods all over a factory and back again. You can often cut this out through efficient planning of the layout of your factory / office (offices are far from exempt – I’ve worked places where paperwork is regularly sent by post between two distant offices for no huge gains).
This is storing more stock (raw material, finished goods, brochures, anything) at higher levels or for longer than is required. Stock costs money, which at very least could be earning you (or not costing you) interest, or be used for even more drastic (productive) things like buying machinery or competitors.
It can also lead to a more direct cost, as e.g. if your product lines change, any stock you have of a particular type can easily become obsolete (and so worthless), so the more you have, the more the hit to your finances. That and more stock needs a larger premises, which can mean more rent, business rates and even external storage costs.
This is like transportation, but within a process. If for a process, you need to do lots of bending / walking / move products around, this is potentially wasted effort.
This again can be people or product waiting for the next stage. Product waiting for the next step in the process leads to more inventory than is needed (see below). People waiting (due to bottlenecks, uneneven workloads, uneven production levels etc) has a direct payroll cost which can add up very quickly.
This is making more finished goods than is required for current usage – this can lead to both higher production costs, and more inventory than is required (see Inventory below).
This is a counterintuitive one, as you’re regularly taught to exceed customer expectations. This however is a waste, as it’s added ‘value’ where you see it as value but the customer doesn’t. Overprocessing is any effort put into meeting a standard above which the customer requires, where the customer is not willing to reward it (through higher prices or increased loyalty / sales).
This is the ‘cost of quality’, or more accurately, the cost of poor quality, and a key overlap area between ‘Lean’ and ‘Six Sigma’. This can also easily be one of the higher costs to your company, whether it be by throwing product away or lost customers who are fed up with poor quality.
Defects is any product not up to the standard expected by the customer, which leads to losses through lost product or lost customers. This can be one of the hardest wastes to remove, but if it remains, can easily take down your company.
Skills / Potential
Whether you consider your staff to be your greatest asset or your greatest cost, they have the capacity to either rise above all competition or go bankrupt. Staff often are underutilised, causing the benefit / cost ratio of your staff to reduce greatly.
This could be down to poor training, leading to lower efficiency work (or causing the wastes above to end up in their work, even if the process doesn’t have them). It could also be where you have staff members who are fulfilling their role but due to their intelligence / experience / attitude could be contributing a lot more to your company – that opportunity cost is costing you money! It could even be just poor management leading to poor morale and direction, so they don’t want to help your company increase production and reduce waste.
Defeating the 7 (or 8) Sins
The whole point of Lean is to remove these evils from your company, and by using the tools correctly, you can over time significantly increase the ‘leanness’, efficiency, profitability and competitiveness of your company