Goering Center news: Finding the needle in the waste-stack
By Chris Luckhaupt
The life of any person — young, old, successful, novice — in today’s “connected” world is built around the need for routines to ground the often chaotic environments and oppressive demand for our time. Leaders within a business utilize their time struggling to identify growth, while fearing change could hinder their current position within a market. Employees devote their lives in the weeds of an organization with the hope of someday reaching that pinnacle of success their leadership has already obtained. Routines allow us to quickly and efficiently control the mundane and necessary tasks of our lives, allowing our attention to focus towards the future.
What happens when the routine is the wall that is blocking our path to future success?
The solution has many buzz words: process improvement, lean, six sigma, continuous improvement and others. Its application into businesses dates back to the 1980s with an engineer, Bill Smith, at Motorola identifying the number of defected products produced out of every one million. Utilizing the fundamentals behind these concepts, Motorola reengineered nearly every department within the organization with the focus on eliminating defects. The result? Billions added to their bottom line. Since that time, nearly every Fortune 500 company, no matter the industry, has attempted to implement their own form of these concepts at varying degrees of success. Simply following a “business as usual” mentality was and is no longer sufficient to compete in an evolving market. Companies are forced to evaluate their routines and effectuate change.
But, I am not involved with a company that size and my issues are different.
The beauty of these concepts is that they focus on one thing, customer value. The Lean methodology focuses on the activities within a process, and not simply the result of a process. Within Lean, we learn of eight categories of waste:
Defects – Is this piece of the process adding value to the customer or allowing the business to meet the requirements our customers expect?
Over Production – Am I creating too much or adding more “bells and whistles” than the customer actually requires?
Waiting – Are there bottlenecks? Is someone or something holding me back from performing my duties?
Not Utilizing Talent – Am I using the skills of the people in the organization appropriately? Am I fully using the potential of our business’ systems and technology?
Transportation – Do we really need this many meetings to “get on the same page” about an issue? Is everyone replying in an e-mail chain the most effective communication method?
Inventory (Excess) – How many people actually use all of these reports?
Motion – Do I really need to type this into the computer or can I import it? How many reports do I need to aggregate to get to the information I am seeking?
Excess Processing – How many levels of review and sign-off does this really need? Why do we keep making and saving so many versions of our documents?
Our daily lives are filled with tasks culminating into a process. We must strive to first identify whether a task adds value to the customer or is waste. Once waste is identified, we strive to eliminate it from the process, with the goal of forming a process containing only value-added activity. The difficulty lies in being able to proactively eliminate the waste, and once eliminated, prevent it from coming back in the future. Though technology has provided the foundation of easily ridding processes of wasteful activity, such means also generate unforeseen pitfalls. Thus, the effort is not simply a one-and-done exercise. Rather, the effort must be instilled as a continuous initiative, finding those needles of value in the ever growing mountain of waste.
Chris Luckhaupt is a Process Improvement Manager at Cassady Schiller CPAs & Advisors, a Goering Center member organization. Reach Chris at firstname.lastname@example.org or 513-827-3923.
Featured image at the top: Headway/Unsplash
About the Goering Center for Family & Private Business
Established in 1989, the Goering Center serves more than 400 member companies, making it North America’s largest university-based educational non-profit center for family and private businesses. The Center’s mission is to nurture and educate family and private businesses to drive a vibrant economy. Affiliation with the Carl H. Lindner College of Business at the University of Cincinnati provides access to a vast resource of business programing and expertise. Goering Center members receive real-world insights that enlighten, strengthen and prolong family and private business success. For more information on the Center, participation and membership visit goering.uc.edu.