Customers expect on time delivery, perfect quality, and a reasonable price. If you’re not meeting their needs, your business is suffering.
The key to growing your business is cutting out waste and implementing a leaner solution.
In Lean Management, waste is anything that doesn’t add value for a customer. Muda, the Japanese term for waste, is any non-value-added task. For example, waste is making your customers wait for a product to arrive (you may lose them as a customer). Or they receive a defective product once it does arrive. Muda wastes your time and money, loses you customers, and stops your business growth.
As Taiichi Ohno, the Toyota executive responsible for Just-in-Time production, points out, “All we are doing is looking at the time line from the moment the customer gives us an order to the point where we collect the cash. And we are reducing the time line by reducing the non-value-adding waste.”
For example, in your home based business, create value for your customers by making it easy for them to navigate your website and locate the information, services, or products they most want. If they’re happy with how easy it was to buy something, then you know your process is lean. from the moment the customer gives us an order to the point
Be aware of waste in your process and rethink the value you give your customers. To help you reduce waste, use Kaizen or continuous improvement principles. Are you addressing your customers’ needs? What do you need to do better? How can you reduce unnecessary steps to serve them best?
Lean Management and the 7 Wastes
Get to know the 7 Wastes and consider how they affect your customers and your business growth. Use the acronym TIMWOOD to help you remember them.
Transport: Moving products around from place to place costs money. Consider the least wasteful options, such as drop shipping.
Inventory: The waste of Inventory hides many other wastes in your systems. If your products are physical rather than digital, you may be wasting money on high inventory that needs to be stored, packaged, and transported, which raises the possibility of damage. Consider how well your inventory flows because of the “pull” or demand of the customer.
Motion: Unnecessary motions in your daily work cost you time (money) and physical effort. For a work from home business, this could translate into poor office space layout or workflow. It could also waste motion with finding something in a disorganised office. Review the 5S methodology for streamlining your business workspace.
Waiting: We spend a lot of time waiting in our businesses. The Waste of Waiting disrupts flow. Avoiding this waste is one of the main principles of Lean Manufacturing. Instead, use downtime to review your business process, ask the 5 Whys, and improve your quality.
Over-Processing: If we’re over processing, we’re performing work that the customer hasn’t requested. This costs us time, money, and other resources.
Overproduction: The waste of overproduction is making too much or too early. It’s the most serious of the 7 Wastes. Overproduction leads to high levels of inventory. Aim to make only what your customer requires when they need it. This is the philosophy of Just in Time (JIT) production.
Defects: Errors that cause defects usually cost us far more than we expect. Every defective item requires rework or replacement. It wastes resources and materials, creates paperwork, and can lead to fewer customers. Figure out what created the defect and correct it permanently by using the Five Whys.
Pull Instead of Push
Let your customers wants and needs “pull” a leaner business decision from you. Your process will be less wasteful. You can focus on your customers’ needs and add more value in their lives. The results will be immediate and measurable with more growth and higher profits.
How have your customers’ needs helped you get lean and provide more value? Let us know in the comments below.
You hold the power to transform your life!