This waste is one of those that isn’t often discussed but has a huge impact on costs for a business.
Too Much Stock
In many businesses it is customary to hold a lot of stock to bring down the lead times for delivery to the customer. Let’s assume that the customer requires delivery of the product that they’ve bought in 24 hours however it takes 72 hours to make or bring in the product. The common solution is for us to hold larger quantities of stock so that we can deliver inside the 24 hours required by the customer. Now with this large quantity of stock we require a large store room and not only have we tied up our cash flow we also have products everywhere. A customer order comes in and invariably the products they want are at the bottom of the pile of stock so we have to move everything out of the way to get what is required. All this moving of stock around is waste (parts travelling) which is adding no value to the process. Not only that, it increases the chance of the product being damaged. An efficient solution to this problem is to reduce our internal lead-times so that we can make or buy in to order and not have huge stock around.
Workplace Layout Inefficient
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