Lean In The Office—Identifying Waste

The manufacturing process is not the only area of a company that incurs waste on a regular basis. Although most of us focus on the factory floor to identify the improvements needed to increase our competitiveness, many companies find abundant opportunities for waste reduction in the office. In many cases, it takes longer to process information and generate paperwork than it does to complete a production order. By some estimates, lengthy office leadtimes are a direct result of ineffective processes that have existed "for years."

This month, I will focus on the typical wastes we find in our offices. The same wastes that are found on factory floors, such as overproduction, waiting, excess motion, frequent transportation and underutilized people, are showing up in office processes.

Let's begin by exploring the waste of overproduction, or generating more product than the next operation can handle. Office processes concentrate on getting a product, in this case information, to the factory floor so that parts can be made to customer specifications and delivered in a timely manner. The overproduction of information can be just as wasteful as the overproduction of parts. For our purposes, let's envision a typical office environment in which orders are received from customers; entered into the company's "system;" and then used to generate production work orders. How often are production orders printed far in advance of when they can possibly be worked on? This is a form of overproduction, and it would probably be better to enter a customer order into the "system," but not print it until it is really needed by the factory. After all, what can the factory possibly do with a printed order that is not ready to run? At best, the order would wait for other jobs to finish (so that a machine becomes available). At worst the order gets misplaced, and personnel waste time looking for it. Another possibility is that something about the order changes, such as a quantity change, a specification change or even a simple change in the "ship to" address. When this happens, the order must be found and corrected (or re-printed). Printing production orders before they can be worked on leads to an excessive inventory of paperwork that sits in drawers, on desks or in a warehouse.

Waiting occurs as often in the office as it does in the factory. In the office, we wait for approvals (both customer and internal), vendor information, financial information and a host of other factors. Unreliable office equipment is another cause of waiting. How often do we experience computer system downtime, copier downtime, fax problems, telephone problems and printer problems?

Excessive motion is another waste that runs rampant in the office. We walk around looking for things that just don't seem to be where they should be. Searching the office for paperwork, supplies, quotes and specifications can waste as much time as searching the factory for work orders, tools, equipment and materials. It is critical that office functions are organized to avoid some of the excessive motion and wasted time associated with looking for things.

The movement of paperwork from one area to another is the best example of excessive transportation in the office. Recently, I was working with a company that had done a good job of streamlining its manufacturing operation, but the paperwork flow was a nightmare. In fact, we tracked the distance a typical hard copy order traveled from inception to shipment. It was more than a mile, and that did not include changes to be made, causing the paperwork to retrace its steps several times. Copies of "everything" also cause excessive transportation. How many copies of paper have to travel to how many people before eventually ending up in how many "completed order files"?

Finally, the waste of underutilized people shows up in most office environments. Although many office personnel are cross-trained and capable of doing many different jobs, some employees are assigned limited tasks, such as entering orders, generating invoices or ordering materials. The more functions a person learns, the more valuable he/she is to the organization. Expanding a person's duties and responsibilities may also be a means of reducing other office wastes, such as re-entering of data, redundant approvals, generation of multiple copies of paperwork and searching for files in multiple areas.

In next month's column, I will discuss how many of the lean techniques we use in the factory can be put to good use in the office.