Embracing Waste in a Lean Culture

These days, waste gets a bad rap.

‘Eliminating waste’ is such a common phrase among lean and six sigma practitioners, the two words are practically inseparable. The problem with this marriage is that it causes us to conflate all types of waste as equally harmful.

They’re not.

Improperly distinguishing between positive waste and negative waste can harm your organization’s lean culture and ability to solve problems.

The Pitfalls of Zero Waste

The idea of eliminating every kind of waste comes from the “no-tolerance” thinking popularized by the Toyota Production System in the 60s and 70s. Aiming for “zero defects,” “zero inventory,” “zero setup time,” etc., this approach created the idea that any metric above zero was a sign of waste and inefficiency.

Setting the standard that anything less than perfection equates to failure, can do more harm than good. Applying this blanket classification leads companies to undervalue key activities that contribute to success.

Setting Goals Too High

Aiming for zero waste can overreach, and end up causing more harm than good. If employees believe that any sort of waste won’t be tolerated, then that pressure may cause them to bend the rules or overlook certain standards in order to meet the zero waste goal. The culture of lean is one of problem-solving, and thrives on openness and freely sharing information. Employees shouldn’t feel judged when mistakes are identified.

Exhibit A: The Ford Pinto

Unrealistic goals have a history of causing companies to compromise standards in order to meet strict objectives. In the late 1960s, Ford was losing market share to foreign competitors. They announced a lofty goal of designing a new car that would be “under 2,000 pounds and under $2,000” — the Ford Pinto.

From Basic Black to Black Marks

This ambitious objective and tight deadline, meant that management signed off on unperformed safety checks to expedite development. It was later revealed that these rushed signoffs resulted in one major design flaw — the car could ignite upon impact. The flaw ultimately lead to numerous lawsuits and an estimated 200 deaths. Decades later, it remains a black mark on Ford’s reputation.

Narrow Goals = Limited Success

Focusing too much on a single success metric or goal can cause companies to lose sight of the bigger picture. In Ford’s case, their goal was too focused on getting their product to market, rather than providing safety to their customers. Ford executives classified waste as anything that didn’t contribute to meeting their deadline — including safety checks.

Not All Waste is Wasteful

Generally defined, something is only wasteful if it doesn’t contribute value to the customer. However, when we set impractical goals, like “zero waste,” “zero defects,” or “zero inventory,” that definition gets smaller, and wasteful activities begin to include almost anything.

“Goals that are too specific often lead employees to develop such a narrow focus that they fail to recognize obvious problems unrelated to the target.”

-Forbes, Why Goal Setting Can Lead to Disaster

3 Types of Wastes to Embrace

If we were to just think of waste as, “time or resources that don’t directly add value to the customer,” then we could draw a clear line to distinguish what qualifies as waste. Unfortunately the world is never black and white, and there are many ways to contribute value to the customer. Delivering value indirectly includes activities that might traditionally be defined as waste, but actually will help your company problem-solve, become more efficient, and innovate.

1. Documentation

Many companies avoid thoroughly documenting their processes because it’s a major time investment. Additionally, they fail to see the ROI of Standard Work, therefore they consider documenting procedures a waste or luxury. However, documenting Standard Work is the foundation for continuous improvement and Kaizen.

Key Takeaway:

Don’t hesitate to get started with your documentation. Investing in Standard Work signals to employees that you’re serious about continuous improvement and their feedback— lean culture will improve as a result.

2. Innovation

Innovation is inherently wasteful. In essence, you’re taking an employee’s time, and mental capacity, and then gambling with it. Innovation is playing against the odds, that one of those bets will generate exceeding returns. You need to show your employees that you value innovation and out of the box thinking by promoting brainstorming activities and experimenting with employee ideas.

Key Takeaway:

Innovative activities can seem like waste because there isn’t a guaranteed return on investment. So rather than thinking of innovation as a bet with your time, consider it as a long term investment. The more you invest early on, your returns will compound in the down the line.

3. Supportive Value Streams

In the book “Value Stream Mapping” by Karen Martin and Mike Osterling, supportive value streams are defined as “any activity that supports the delivery of value [to the customer].” These activities enable the success of your primary value stream, by supporting the roles of those operations through things like marketing, recruiting, onboarding, and training.,

Key Takeaway:

Treat supportive value streams as equally important to the fulfillment of customer requests. Lean culture can’t be isolated to those involved in production — improving culture requires a wholistic approach.

Waste is Necessary

Waste is necessary in the same way that it’s necessary for Michael Jordan to get rejected from his high school basketball team — it creates motivation. Not only is certain waste good for lean culture, but reminding ourselves that we always have room for improvement prevents stagnation and drives improvement.

“The only real mistake is the one from which we learn nothing.”

-Henry Ford