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Eliminating the 8 Wastes of Lean Part 2: Overproduction

Posted by Adam Tarr on Jun 1, 2018 12:39:51 PM
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Lean Waste - OverproductionDefining and Defeating Overproduction Lean Waste

For most businesses, overproduction is viewed as a the worst kind of waste. It unnecessarily consumes time, effort, money, materials and resources that could have been better spent elsewhere, and leaves your organization with the burden and logistics of dealing with excess inventory.

More so than any other Lean waste contributor, overproduction has the ability to overshadow all other problems within your organization. [1]

Causes of Overproduction

To get at the root of overproduction waste for construction programs and/or manufacturing product businesses, we must not be afraid to engage, ask questions, and review processes and procedures. As you can see, "asking questions" should be your initial step. Most companies and their personnel are generally unaware of overproduction. This usually stems from improper training, lack of familiarity with lean principles, or just accepting the status quo. 

In addition to lack of awareness, overproduction is largely caused by faults in the production line. Such faults often include:

  • The desire for longer than necessary production runs and product batch sizes due to long setup times
  • Ordering more supplies than necessary, just in case
  • Expecting disrupted production flows
  • Unbalanced production stages, cells, or departments
  • "Forecasting" what the customer might want in the future, creating a false demand

Overproduction warehouse

Effects of Overproduction

Overproducing causes companies to draw on capital for extra materials, unnecessary tools and machinery, additional facility capacity, and excessive inventory space. This not only creates cash flow constraints, it can cripple an organization. Overproduction has indeed contributed to many company failures. 

Overproduction waste can create a domino effect. It often begins with a false demand or inaccurate calculation of what is actually required to complete the scope of work. Starting a process with incomplete information will drive inefficiencies throughout the entire operation. These inefficiencies may then follow a progression which leads to additional waste, such as: 

  • Over-staffing
  • Over-supplying
  • Over-shipping
  • Growing distrust for the reliability of your own processes and ERP software programs
  • Fears of making change
  • Fears of listening and/or speaking up in front of management

All of this serves to reduce awareness and diminish reporting accuracy which can further reinforce the problem at hand.

Solutions for Overproduction Waste

Eliminating overproduction essentially boils down to making only what the customer demands and avoiding "just-in-case" production habits. A just-in-time (JIT) delivery model is the preferred approach. JIT can be largely achieved by:

Process piping delivery
  • Running smaller batch sizes
  • Creating more reliable processes, and trusting in them
  • Establishing stable schedules
  • Balancing departments
  • Using accurate information to map actual demand

Everyone in your company has the ability, and responsibility to affect change. Promote and develop this awareness and you will find it much easier to implement the principles of lean manufacturing to reduce overproduction waste.

In closing, there's really no shortage of available tools, programs, and resources to help combat overproduction among other Lean waste. It's just a matter of choosing to start somewhere, partnering with other Lean advocates, setting examples, and committing to learning, growing, driving results, solving problems, and being collaborative.

Finally, keep in mind that implementing lean practices and or principles is a continuous journey. By taking small steps and working together with other lean champions, your company will benefit and will see continuous improvements. 

Continue to Part 3 of our 8 Wastes of Lean Series, where we examine "waiting" as a primary Lean waste contributor.  

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Topics: 8 wastes of lean, overproduction