Let’s take a look at each of the wastes, and at what may be accomplished to help by using ERP in lean manufacturing environments.

 

No. 1 - Transport Waste

 

Transport waste happens when you move items or materials from one area to another without adding value to the goods customers will in due course receive. It occupies an operator’s skills, equipment, and vehicles without contributing to productive work.

 

To tackle transport waste in your ERP, you’ll want to access tools that assist regulate production and logistics, so there’s no needless movement of goods from one location to another. You’ll also want a system that allows you organize and monitor the use of your transportation equipment and rolling inventory.

 

ERP may possibly help with going lean by giving urgent visibility into inventory-level data. If you’re not able to check inventory levels, trends, and locations in your current ERP, there’s a good chance transport waste is at least partially to blame.

 

No. 2 - Inventory Waste

 

Raw materials, goods in production, and finished inventory sitting on cabinets does not do any good for your buyers. The longer any of your materials sits, whether finished or not, the longer it takes for that good to produce a profit, therefore contributing to inventory waste.

 

Inventory waste is often a result of poor forecasting, bad production planning, and sub-optimal distribution practices. To get over these challenges, the best ERP systems have built-in functionality for supporting just-in-time (JIT) manufacturing, making certain that none of the means of production are ever in a state of non-movement. Efficiency to consider includes tools that increase forecasting accuracy, set reorder points and min/max stock levels, and the availability of historical item data to track sales history.

 

No. 3 - Motion Waste

 

Waste of motion occurs when an individual or piece of equipment moves in any way that doesn't add value to a product. Poor design of a production facility creates employees to move in a way that wastes time and energy. Excessive wear and tear to machinery can also result from an inefficient layout, leading to further motion waste.

 

Powerful ERP platforms allow you to fine-tune your processes to incorporate production times, assisting better distribution of equipment workload. They also provide the data context you should have to work with the equipment suppliers, so you can assure the machines you use are built and installed to work in the most effective way possible.

 

No. 4 - Waiting

 

Any period of time where progress is simply not being made on an item can be considered waiting. Waiting happens on decisions, information, machinery, and much more. Waiting usually comes about when staff members can't really make a decision due to the fact that they lack information, departments aren't in tune with each other, or production is halted by bottlenecks.

 

No. 5 - Overproduction

 

Overproduction is generally regarded to be the worst of all the wastes, mainly because it contributes to all other wastes and it obscures the need for improvement. Overproduction waste takes place when you manufacture more of an item than your customers need, or when it’s produced before it’s time to make a delivery. This happens as a result of bad supply chain management, procurement, and demand planning.

 

To counter this using your ERP, you must have visibility into your inventory, and enough control to adjust production, purchasing, and warehousing with your actual demand. You’ll want to use an ERP that acts as a single source of your company data throughout the whole supply chain. Having this visibility combined with specific demand forecasting means manufacturers don’t need to err on the side of caution and overproduce.

 

No. 6 - Over-processing

 

Over-processing produces waste because you put more work into a product than is actually valued by a customer. It may look nice to paint the inside of that part that will never actually see the light of day, but if your customer doesn’t need it, you’re wasting time and energy. Over-processing is normally caused by a lack of standard operating procedures.

 

To lessen over-processing using your ERP, you’ll want to use tools that scale down the number of human touch points during the processing stages. For example, other than having a quote or spec order created by your sales team manually re-entered as a BOM, an ERP focused on reducing over-processing will enable you to turn the quote into a BOM directly with one click of a button (or even better, it will turn the quote into a BOM automatically!). The right ERP will also allow the monitoring of productions to ensure that your company is hitting the right KPIs and customer goals.

 

No. 7 - Defects

 

Defects waste time and materials on products that don’t live up to quality standards. They can result in negative customer experiences, putting a strain on relationships or even lead to lost customers. Defects also waste physical means of production.

 

Counteracting defects in ERP is slightly more challenging than dealing with the other types of wastes, but good manufacturing-based ERP platforms provide you with the control to determine deviations in quality immediately after they appear, stopping the production of defective goods. The sooner these deviations in quality are discovered, the sooner an engineer can investigate the issue before it causes extensive downtime or damaged product.

 

Work With ERP, Not Against it

 

Using ERP to eliminate waste is possible. If your ERP has the right tools, you’ll be able to take the steps necessary to improve your operations’ effectiveness. With a little know-how and effort, your business can actively fight sources of unnecessary waste by using ERP software and trimming down on excess or outdated processes that may have been holding you back without your knowing.

 

This article is originally posted on tronserve.com