FEATURED POST OF THE WEEK

Our long-form article of the week. You can always view the current and past featured posts on Empower’s blog.

Muda: How eliminating business waste improves efficiency

I like to think of myself as a lifelong learner. Expanding my knowledge helps me solve the diverse challenges business owners face and stay current with emerging trends. Since launching Empower in May, I’ve enhanced my knowledge in several areas. Lately, I’ve been particularly focused on supply chain and logistics. My background hasn’t centered on e-commerce, manufacturing or distribution, but the topics have been on my “learning list,” and they are important aspects of many businesses’ overall operations. I’m taking an online certification course to upskill, and one topic recently introduced in the content stuck with me — the Japanese concept of “muda.”

The word muda translates to “futility,” “wastefulness” or “uselessness.” In supply chain operations, muda is part of lean process thinking, denoting wastefulness in resource allocation. It focuses on identifying activities that don’t add value and eliminating the waste in those business processes. The overarching goal is to increase efficiency.

The seven types of muda (business waste) to address

Muda manifests itself in various ways depending on the aspect of the production process in focus. Below are seven types of waste commonly identified in lean manufacturing:

• Transportation waste: Unneeded movement of materials, products or information.

• Inventory waste: Unused excess of materials and products.

• Motion waste: Unnecessary movement of people and equipment.

• Waiting waste: Any time burned associated with waiting for approvals, materials, information, services, etc.

• Overproduction waste: Making more than what’s required in the near term.

• Defect waste: Delivering products or services that don’t meet quality standards.

• Processing waste: Adding steps to a process that don’t create value.

Why muda matters

After reading those seven types of muda, it should be clear how this waste can negatively impact a business. Each of those categories can cost valuable time and dollars that should be invested in value-creating activities.

While I started this post talking about heavy supply chain logistics and manufacturing businesses, muda is relevant for any business type. There’s a value chain to delivering any product or service, and muda can surface anywhere. As one example, a local specialty grocer could build up inventory waste, which could prove more harmful if the products have short shelf lives. For a second example, consider a boutique law firm grappling with defect waste because the work product delivered to clients contains errors and lacks high-quality standards.

I always say that focusing on back-end operations may not be the most glamorous part of running a business, but ignoring the excess can be detrimental, particularly in today’s market environment. Last week, I referenced a PwC piece about the “global sludge tax” (i.e. obstacles that slow efficiency). The report indicated the estimated annual cost of lost productivity could be as high as $10 trillion. There’s a lot of opportunity for improvement and optimization in that number.

Taking steps to reduce business waste can lead to:

• Better productivity and output

• Cost reduction

• A better allocation of resources

• Improved quality of products and services

• Enhanced customer satisfaction

• A more competitive market position

Five practical steps to identify and eliminate muda

In thinking about how to identify and rid yourself of business waste buildup, consider these five approachable steps for your team.

• Step 1: Conduct a waste audit. Analyze your value chain, processes, key performance metrics and team feedback.

• Step 2: Categorize and prioritize. Outline which form(s) of muda you’re dealing with and then assess the overall impact and ease of removal for each.

• Step 3: Develop solutions. This requires understanding the root cause and finding creative ways to reduce as much waste as possible (e.g., improve inventory management systems, introduce better quality control processes, foster more cross-functional engagement).

• Step 4: Measure progress. Implement standard metrics to establish a baseline and then evaluate ongoing performance.

• Step 5: Instill a culture of continuous improvement. Eliminating waste once isn’t enough — more can always surface. Nurture a culture of learning, encourage feedback and regularly review, audit and amend strategies based on results.

If you’re stretched thin, consider bringing in an outside partner to help with this assessment and/or implementation. If this sounds like your situation, take a look at Empower’s offerings and reply to this newsletter to chat. I’d be happy to discuss how we may be able to assist.

Closing thoughts

Much of what I’ve discussed here involves eliminating waste and “taking things away.” But the real power of focusing on muda is that you’ll deliver more value to your customers while maximizing the effectiveness of your resources.

Think of it as addition by subtraction.

WEEKLY DOSE OF EMPOWERMENT

The weekly dose of Empowerment is meant to provide one weekly tip that’s both practical and approachable, to help drive incremental improvement to your day-to-day. We’re always open to your contributions as well. If you would like to submit a tip to be shared with the Empower community in a future newsletter, please reach out at [email protected] with the subject line “Weekly Dose of Empowerment Submission.”

The 3-2-1 feedback framework

On a scale of 1-10, how would you rate your team’s comfort with providing you feedback?

While it’s not always easy to receive feedback and hear about things you or the business should be doing better, it’s still important for you to hear. If you build a culture where feedback isn’t accepted and appreciated, issues may stay hidden for too long. The long-term ramifications could be greater than if you provided the ear to listen.

So, if you’re someone who struggles with receiving feedback, and you think the people around you may not be sharing as much as they could, then the following 3-2-1 framework could be one to try.

How it works

Each week, implement the following with your team:

• Highlight three positive things that happened: Whether in a group or individual setting, provide three pieces of positive reinforcement about good things you observed the prior week. This will boost morale and reinforce the behavior you want to see.

• Solicit two pieces of feedback: Ask for feedback from two sources. The more people see you’re open to receiving, the more likely it is that they come to you unsolicited in the future.

• Offer one piece of constructive feedback: Think about one piece of actionable advice you can give an individual or your team to improve. Keep it focused; don’t spew out a laundry list and aim to be solution-oriented.

The benefits

• Modeling giving and receiving feedback shows this is something you value and want to see more of across your organization.

• Building a more collaborative environment where people feel safe sharing ideas and providing important feedback about the business’s health.

• More quickly double down on things working well and conversely resolve manageable issues faster before they turn into a bigger liability.

• Better team performance through more consistent feedback loops.

JESSICA’S READ, OR LISTEN, PICK OF THE WEEK

A little something that got my gears turning this week and might pique your interest as well!

From Harvard Business Review: Keep Strategy Simple

TL;DR

Last week, Harvard Business Review published an article about simplifying strategy. As we get closer to Q4, this is usually a time businesses evaluate their current-year performance, start planning for the subsequent year and re-visit their overall strategies.

So, it’s a fitting time to read a piece to make part of that process less intimidating.

Here’s a preview of the tips offered:

• Don’t develop strategic plans for functions.

• Confine strategy to the business level.

• Keep strategy and action separate.

• Mind your language.

For more details, read the full article!

JUST FOR FUN

Really, this section is just for fun. Who knows what will be in store each week?

Not to toot my own, but I made a pretty delicious meal for my family last weekend — shrimp tacos and Mexican street corn. Before becoming a mom, I explored and experimented more with new recipes. More common now, I stick to things I know that are fast and easy to get on the table.

So, when I find new recipes these days and “the crowd goes wild,” I get excited. Remember, it’s all about those small wins 😉

If you’re looking for something new to whip up this weekend, here are the two recipes:

• New York Times Cooking Shrimp Tacos

• Lil’ Luna’s Mexican Street Corn

If you make either, let me know how it turns out!

LOOKING FOR MORE EMPOWERMENT?

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If you want to learn more about Empower’s offerings or methodology, reach out to discuss how we can support your goals. 

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