Eliminate the Waste of Inventory

Posted by on May 10, 2011 in Lean | 0 comments

Inventory is the raw materials, purchased parts, work-in-process components, and finished goods that are not yet sold to a customer.  Inventory in an office environment may include physical or nonphysical inventory like orders, items waiting to be processed, and e-mails.
Inventory anywhere in your value stream is non-value-added.  It ties up your financial resources and it is at risk to damage, obsolescence, spoilage, and quality issues.  It takes up valuable floor space and resources to manage and track it.  It can also cover up other sins in the process like imbalances, equipment issues, or poor work practices.
Some other examples of inventory include:
  • Building more product than what the customer demands
  • Excessive sales literature/brochures
  • More office supplies than required
  • More IT equipment, printers, etc. than required
  • Documents/records held beyond their retention period
  • Various forms in people’s in-boxes
  • Orders queued at a fax machine
  • Design projects in queue or underway
  • Line items awaiting purchasing to process, etc.

Suggestions for eliminating inventory are:
  • Document the requirements for each step of the process.
  • Standardize work locations and the number of units per location.
  • Provide only what is needed by the downstream process, when it is require, so it does not sit there.

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