Lean Helps When Downsizing

 In Business, Business Operations, Operations Management

Being forced to reduce staff is unpleasant no matter when it must be done.  However, the implementation, adaptation and use of lean guidelines allows a business to operate more efficiently and effectively once business challenges are identified.

Let’s explore each business challenge—

  1. Excess Inventory—Whenever you have excess inventory, you have capital expended that is wasted.  Excess inventory takes up space, can be come damaged, pilfered, and obsolete and may incur excessive disposal costs to eliminate.


  1. Overproduction—This is closely related to excess inventory.  Failure to carefully plan all production activities can create excess inventory or wasted resources that could be better used elsewhere.  The same issues we identified in excess inventory are present in over production, with the addition of additional man-hours used to produce the overproduction.


  1. Waiting TimeAny time associated with waiting is waste. If a machine needs a fixture, part, tool and time is expended waiting for that device, waiting time is incurred.  The same is true in a hospital, restaurant, and office environment.  All of the necessary parts, products, pieces needed for any operation should be close at hand so that when needed, no time is expended waiting for a part to arrive.


  1. Unnecessary Transportation—Transporting a product around, across or through a work space takes up time and money. Here is where effective and efficient plant layout comes in.  Don’t be spooked by the concept “plant layout.”  This could be an office, where the phone and receptionist are located, where the paper and labels are near a printing device, etc.  If you have to make any movement in order to complete a process, time is wasted, costs are incurred and efficiency is decreased.


  1. Processing Waste—A simple example here is removing packaging in order to obtain the part needed to fulfill the operation. If you have to unwrap the box, remove the packing material, unwrap the part before you actually are able to physically touch the part, you have processed waste that is of no value.  A better way would be to have the parts shipped in bulk, without excess packaging, in order to improve manufacturing or processing time.  Although we talk in terms of manufacturing, these same concepts can be used at home, in an office or administrative environment just as easily.


  1. Inefficient Work Methods—Having workers bend, reach, stretch, grab, and exert their body in unnatural ways is inefficient. If a computer monitor is placed above eye level, the worker must look up all the time, stretching his/her neck, head and spine in order to see the screen.  A better layout would be for the screen to be at eyelevel where the employee can look directly at the screen and not have to place his/her body in an unnatural position.  Work bench height is another example.  If an employee has to bend over, stretch forward or reach up to work on a part or object, he/she is subject to fatigue which causes waste and inefficiency.


  1. Product Defects—Product defects are caused by work processes or procedures which are ill thought out or ill defined. It is easier to build a quality product than build a product for defects.  Yes, this costs more, initially, however, the overall lifecycle cost of the product is much less.  Studies have clearly shown that quality built in is cheaper than having to inspect for product defects.

8.  Underused People—Each of us has been in a position one time where we were underused. In some cases, significantly so.  Everyone has skills and abilities that can best be employed in a wide variety of environments.  You will be amazed when some people actually ask to perform a task that you did not think they could perform.  Cross training, or homogeneous job enrichment is another idea that ensures that people can perform a variety of jobs in the environment.  In this way, people are used to their best capabilities.

Here is an interesting article that was in the Harvard Business Review that shows the benefit of a lean work environment. Click HERE to learn more about the lean work environment.

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