Sources of Waste: Overproduction

by Jan 5, 2021Continuous improvement

Like we established in our previously published blogs on continuous improvement and lean management or Muda (無駄), the latter a Japanese word meaning “wastefulness; uselessness”; it is easier to define the different sources of waste as anything that the end customer or client would not pay for. Starting with this simple definition, it is easy to understand why overproduction is one of the 7 sources of waste listed in Muda.

Producing too much means exceeding client or customer demand (here we are not talking about exceeding customer demand in terms of quality or product specification as is the case of overprocessing) which generates unnecessary additional costs.

Overproduction can be considered among the worst sources of waste because it can trigger the other 6. For example, the existence of overproduction will require more unnecessary transportation, more movement for manufacturing, handling, more waiting times, more possibilities for product loss and defects, etc.

Overproduction can be caused by several supply chain and production management issues. For example, overproduction could be a direct result of the excessive size of the economic batch in response to the overly long and poorly controlled changeover time, which becomes the real motivation behind the quantities produced instead of the quantity desired by the customer.

Overproduction can also be the consequence of a lack of trust in suppliers, of being able to deliver what you need on time, so you tend to ask for more than needed and for shorter deadlines than needed.

It can also be caused by a lack of confidence in the reliability of processes, where production interruptions are anticipated, which generate large quantities of unsolicited products as a way of managing risk.

The first step in facing the problems of overproduction is no secret, it is the control of the supply and production processes through an increase in the reliability of the processes, effective risk management, the use of production planning tools (enterprise resource planning (ERP) or material requirements planning (MRP)) and the use of methods to improve the performance of processes such as single-minute digit exchange of die (SMED) for the minimization of changeover time and the standardization of the tasks.

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