Saturday, January 30, 2010

Seven wastes|Waste of Defects

In my previous post on how to implement lean manufacturing I discussed the seven wastes, within this post I will discuss the most obvious of wastes, that of defects. By most obvious, I mean that when most people think of waste they generally only think of product or services that are defective.

What is a defect? Well a defect is any product or service that has failed to meet the customer requirements, whether you are talking about the customer as being the final end user or the next step in the process.

We have defects in what we do for a number of reasons, and many people and companies turn a blind eye to defects as they are used to it. How many manufacturing companies accept product from their suppliers that the operators then have to tweak to make it fit into the process? How many times a day do you personally tweak or repair something to let yourself progress in your work without going back to the owner of the defect? We live in a world full of defects in one way or another and we are programmed to just accept it. DON’T.

Defects cost more than you think, the cost of a split widget in the manufacturing process is not just the material cost of that widget and the cost of labour to get it there. The cost of defects is often described as an iceberg, just a small part of which is floating above the surface.

When you are learning how to implement lean manufacturing you need to be aware of what is laying beneath the surface of the water. Defects have many hidden costs, these include rescheduling costs to replace defective product, excessive inventory, reduction in capacity, longer lead times, rework, scrap and concessions, paperwork, complaints and potential lost business. The list could go on and on, typically the true cost of a defect is 10 times the initial cost.

What causes defects, well there are many things that could cause them. Typically they are caused by unclear operating procedures and poor specifications. Normally due to a lack of training, shortage of skills or even down to just a plain old fashion operator error.

In the past many companies tried to find defects through the use of quality control. They had inspectors and testing to try to find defects and remove them from the process. Many companies still use these quality control inspectors. But this is not how to implement lean manufacturing, we want to eliminate the waste of defects not just find them. At the end of the day the inspector is just an additional cost within the company, what he is doing is not adding any value to the product and is all waste.

Most companies now have “seen the light” and look at quality assurance, assuring the quality of the product by putting in place processes and specifications to prevent the production of defects rather than trying to find them after the event. However in my experience the beaurocracy that they put in place can be excessive and unnecessary.

When learning how to implement lean manufacturing we need to ensure that our processes do not produce defects through improving the reliability of processes through things like total productive maintenance (TPM) and using techniques such as Poka Yoke (mistake proofing). Look for the waste in your processes and eliminate the waste of defects. More on these techniques and how to implement them in later posts. The following link will enable you to go back to the description of all wastes to enable waste elimination.

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