Muda & The 7 Deadly Wastes of Co-Pack
When you think about waste in your facility, are you just thinking about subcomponent materials or defective finished goods that are thrown away or rejected?
Sure, that’s part of it. But what is the biggest cause of waste in your contract packaging operation? For most, it’s certainly not the damaged goods emerging from your production lines.
The concept of “muda” is entrenched in manufacturing as a practice for eliminating waste and increasing profitability, and we’re borrowing its principles to help you identify inefficiencies and waste in your facility.
Your operations team is probably used to looking at the efficiency of your facility in such terms as:
experiencing a bottleneck with labor balance on the production line
experiencing a problem with equipment uptime during production
experiencing a shortage of inventory during production leading to unplanned downtime
But are you able to think about your co-pack inefficiencies systematically so that you can quantify the above inefficiencies and find others not as visible?
We introduce the concept of the “7 Deadly Wastes of Co-Pack”, as derived from the seven wastes outlined in Lean Manufacturing practices.
The 7 Deadly Wastes of Co-Pack
Transportation includes the unnecessary movement of information, products or components from one area in your facility to another. Each time product or paperwork is moved, it’s exposed to risks of being damaged, lost or delayed. Transportation is also an added cost that adds no value to what your customer is willing to pay for.
Example of Transportation in Co-Pack: Subcomponent pallets moved to multiple staging and putaway locations before being delivered to the production line.
Inventory in the form of raw materials, work-in-progress (WIP), and finished goods, is capital that has not yet produced revenue for the producer or the consumer. All inventory that is not being actively processed to add value is considered waste.
Example of Inventory in Co-Pack: Subcomponent leftovers stored in the warehouse awaiting customer disposition.
Unlike transportation, which refers to costs of damages associated with movement of items, motion refers to waste in the ergonomics of personnel movement. For example, the excessive walking and lifting that is carried out by shop floor workers is usually due to poor process design and/or work area layout and creates wasted time and effort.
Example of Motion in Co-Pack: Operators walking and turning to place subcomponents inside a display.
Each step in a production process is dependent on the upstream and downstream stage processes. If employees, equipment, information or materials of the production process are delayed, production time is wasted and the cost of production will be increased.
Example of Waiting in Co-Pack: Production line waiting for subcomponents due to stock out.
Over-processing is when more time than is required by the customer is spent on producing an item. This includes processes that are more precise, complex, high quality or expensive than required.
Example of Over-processing in Co-Pack: Excess pallet stretch-wrap to secure finished items on pallet.
Overproduction is to manufacture a product before it is required. Sometimes seen as the opposite of “just-in-time” (JIT), overproduction is also referred to as “just in case.” This causes waste such as high storage costs, or deterioration in quality and freshness of product. This could be the worst kind of waste, because it usually multiplies other kinds of waste, such as unnecessary motion and transportation.
Example of Over-Production in Co-Pack: Finished goods in storage awaiting sales orders for shipment.
Defects are caused by quality control issues in the production process, resulting in finished goods that are unusable, or require rework. Defects have a direct impact on the bottom line, as they usually require re-inspection, rescheduling, and capacity loss, to name a few.
Example of Defects in Co-Pack: Finished good items failing check-weight test requiring rework.
For you to truly tease out the biggest offenders of waste in your co-pack facility, you need to look at your business holistically and systematically. Muda is a framework you can start with to evaluate how much waste your plant is capable of eliminating, although it’s by no means exhaustive.
In our next post, we look at the top 3 most common causes of inefficiencies in co-pack and how you can develop processes that minimize the amount of waste and maximize the operational efficiency in your warehouse.