5S And Eight Wastes – Part II – Inventory

If most managers treat 5S as a housekeeping program, then how can we believe that 5S is the cornerstone of continuous improvement? By overlaying the 5S 'over each of the eight wastes we can further our understanding of how 5S is NOT a housekeeping program, but a way to think about the job.

The eight wastes as defined by Taiichi Ohno, creator of the Toyota Production System, are:

1. Inventory

2. Overproduction

3. Defects

4. Motion

5. Conveyance

6. Waiting

7. Over-processing

8. Underutilized people or specifically the minds of people

5S is NOT a housekeeping campaign. If a housekeeping campaign were foundational, then many businesses would hire and permanently staff auctioneers to sell off unneeded materials, interior designers to paint and stripe the factory plaid, and cleaning crews to keep the factory spotless. This is the logical conclusion of the fundamental housekeeping campaign, yet we rarely if ever see this level of commitment to such a program. So, let us apply the 5S system to the eight wastes and see if we achieve some clarity of thought on this issue. I suggest to you, the curious reader, eternally searching for meaning behind innocent systems that prove impossible to succeed due to our inability to execute with simplicity, that the 5S system is a thinking process. That it is primarily used in the business of keeping factories neat and tidy and marginally safer is a convenient way to prevent managers from breaking through the improvement barrier, losing the all important power of control to the millions of potentially brilliant workers in the US industry. 5S is NOT a housekeeping campaign, it is a thinking process. In theory, a thinking process is a philosophy. Soon, we can begin to understand why 5S is considered a cornerstone, a foundation to build all other improvement knowledge and experience. I ask for your patience as I apply the 5S 'across the Eight Wastes. Following are the many points that detail how 5S is a thinking process.

Filtering our view of INVENTORY with 5S thinking.

We begin with inventory, since many feel it is the cloak for all other wastes. With inventory we realize the subordinate seven wastes: obsolescence, excessive capital and poor cash flow due to overproduction, waiting due to the nature of slow moving stock, defects we produced that slipped through our quality sampling system, motion as we rush to make product we do not need, over-processing transactions for unneeded inventory, transportation of product that is not needed and lost ideas, underutilized minds, since we were busy making product not needed. What ideas for improvement can we generate if we can not see the problems hidden by mountains of inventory? Within the mountain, there are caverns loaded with treasure chests full of problems! Do you dare enter?

Using the English word and coupling it with Japanese meaning, let's 'sort' our inventory. What is really needed? Do we have the right amount? Let's determine real, point-of-sale demand and size our inventories to those demands. This is done where flow can not be achieved. Is it the type desired by the customer? If no, let's determine the right types and amounts and 'set' this inventory in an orderly fashion. What does this mean: orderly? Is it now ready for withdrawal by the next downstream process? Is it in the right area? Is it arranged in such a way that the customer making the withdrawal can take the right amount and right type, avoiding mistakes? Is it presented in an easy manner? Are you as a manager inspecting all of these features of sort and set within the inventory management process? Is it clear what is really needed? Are you going to the genba and doing the white glove test for inventory? How much, right type, right place, right time? We inspect the cleanliness of work areas, but we must also inspect the standards we create through sorting and setting in order. Are we sustaining the inventory reduction effort by determining new and better ways to operate the process? Improvements will allow us to lower inventory, furthering our problem solving effort.

Inventory exists in the office as well. Right now, in your organization, how many unread emails, delays in responses, stacks of purchase orders, waiting for approvals, batching of time cards and many other administrative bottlenecks actually exist? When you think about it, the same rules to physical product inventory apply to these office inventories. Why can not we agree on system behaviors regarding emails, or limits on purchase orders, or process time cards daily rather than weekly? Deviations to these standards would indicate potential problems, or abnormalities, things we did not expect to happen. In doing so, we create flow of these processes. Since we are modifying a person's work area in the office, we are infringing on personal space with much more intensity than in the shared space of a warehouse or shop floor. It is even more important to embrace the 5S thinking process from the person's perspective when dealing with office workflow.

Lesson learned

When we lay the 5S system over the context of inventory waste, first we look for what is needed from the perspective of the customer. Once determined, we set things in order fashions so that inventory is ready for withdrawal. This is perfectly aligned with the concept of Just-In-Time thinking. We may use some tools such as kanban and continuous flow to achieve this orderliness, but regardless of the tools used, inventory is ready in the right amounts, right types, in the right place and the right time. When we sweep through the area or conduct a shine inspection, we are inspecting the system for contamination. In this example the contamination is inventory outside the acceptable kanban limits, or inventory in the wrong location, or defects in the finished goods. Like hand washing your car in the driveway, inspecting the workplace is a personal experience. You wash the windshield and see the wiper blade pulling away from the frame. You take corrective action now, in the safety and convenience of your home, not on the busy, snowy highway while you are on your way to a family gathering or important meeting. Sanitizing helps us avoid accidents in this way. It collects everything is normal, if it is not, in the case of the wiper blade, the situation goes from safe to unsafe. So, do the same type of inspection in the workplace. Go to the inventory locations. Make the normal limits and levels visual in the workplace so your inspection is done within a series of quick glances. Are they within the limits? If no, your system is contaminated with variable: you must sanitize the system. You have gone from one state, "within control of cost, quality and productivity" to "out of control". This is why Ohno once said that the word 'sanitize' is a better term for seiso than 'shine' or 'sweep'.1. When US managers say 'sweep' or 'shine' we lock ourselves into thinking that 5S is about cleaning. It is NOT about cleaning. The third S is about sanitizing, the exemption of contamination in all its various forms, from the process. From here on, I will always use the word 'sanitize' for the third S. If we use the word sweep, we think cleaning. As simple minded as this may sound to you, it is the largest reason why 5S is a housekeeping campaign in the US

Standards are the rules you have set up for your inventory regarding sorting, setting, and sanitizing. Using the standards must be an easy job; otherwise, people will not use them. Good standards are exemplified through a visual workplace. By using the visuals we can determine if normal or abnormal conditions exist. The visual indicators or standards must be something useful and meaningful to the people working in the genba. For example, a fixed quantity of kanban cards located at a kanban post tells the manager how much inventory is in the system. If the kanbans are not located in one location, it may be difficult to determine what is normal. If bin quantities are not standardized it may be difficult to understand how much inventory should be in the system, or how much to run, or possibly fill a non-standard bin with the wrong type. Ambiguity in standards forces people to make decisions. Clear standards allow people to simplify decisions and make the right ones. Red means stop, green means go. Yellow means two things to people: 1) caution, this light is about to turn red or, 2) speed up and try to make it before it turns red! Ambiguity is the killer of good standards. It is your job as manager to remove this uncertainty from the process, simplifying the millions of decisions that need to be made. Think of it this way. If there are ten thousand little tasks in your personal work area that means there are at a minimum twenty thousand different outcomes. We all know that five mechanics will do a job five different ways. So if the mechanics' job involves 500 tasks, then we can expect 2500 different ways of doing the job. The same is true with inventory and the decisions made to manage that inventory. This is the sustain part. Encouraging people to simplify the decisions in managing kanban and inventory is one small way to true empowerment and involvement. It is an opportunity to teach others working in the genba why reduction of inventory is important. There are teaching opportunities around every corner, every day, in the genba.

In Part III, we apply 5S to other wastes.

Source by Bryan Lund

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