Is there such a thing as too much value? Our instincts tell us the answer is no. After years of lessons on “continuous improvement” and “the pursuit of excellence,” it’s tempting to believe that raising standards is always a good thing, but that’s often not the case, especially in manufacturing and distribution operations. In those instances, adding what we incorrectly perceive as “value” actually creates waste – wasted time, labor, parts, and materials, even equipment, capacity, and lifespan.
The deciding factor? What’s it worth to the customer?
The classic example of overprocessing is painting a mechanical part that is never seen post-assembly. Unless that coat of paint is necessary to prevent corrosion or improve function, it’s unlikely to be worth anything to the customer. Would the customer be willing to pay extra to have an unseen part painted? Of course not. Yet the manufacturer is paying for it with extra materials, added labor, longer cycle times, and probably additional health and safety requirements. If a painted finish adds no customer value, why do it at all?
Of course, you always want to give customers their money’s worth. That means providing a quality product that meets their needs. It doesn’t mean providing a product that is better than it needs to be. Your product should meet your customer’s performance standards consistently, but no more.
Generally, overprocessing begins with good intentions (but you know what they say about where those lead!) or an abundance of caution, and often gets its start at the design stage. Engineering may call for unnecessarily tight tolerances; designers might specify expensive or hard-to-procure materials when a cheaper, more plentiful material would do just as well; sales might push for machined and polished components, a preference based more on presentation than on end-use requirements. In addition to the cost of meeting excessive standards, there is also the burden of measuring, testing, verifying and maintaining the overzealousness!
Do you have standardized work practices in place to ensure efficiency and uniformity? In an attempt to go the extra mile, diligent workers might go above and beyond production standards, introducing variations that consume extra time and resources.
Do you regularly examine your processes to see whether certain steps should be eliminated, compressed or combined? Do you test substitute materials and evaluate alternate methods? Do you have transparent communications with your customers to evaluate and update quality and performance standards? Having a clear understanding of what your customer really values gives you the insight to improve production methods, eliminate unnecessary work and streamline your processes to eliminate waste.
Every non-value-adding step in your process is a gift to your customer, an unpaid-for, unacknowledged and unappreciated extra that, over time, costs you dearly. For what it’s worth, there’s no value in that proposition.
Count on UNEX for solutions that maximize space usage, increase pick rates and improve ergonomics, so you can keep processes and profits flowing. Contact your Pickologist to learn how UNEX can help you reduce the amount of effort required while boosting customer value.
Check out week 6: Inventory: Why keeping comfort stock should make you very uncomfortable