Abstract:
It is well known the great waste that Mexico suffers today as a nation of fundamental natural resources for social and business life such as water, energy and basic supplies such as wood, corn, plastic, cardboard, glass. Beyond that, millions of tons of solid waste from inputs and raw materials used in the industry are calculated, as well as millions of wasted man hours and underemployed labor. In this regard, in Mexico City, on average, a person loses between four and five hours of their daily life in traffic, which translates into a lack of productivity as a nation and an accumulation of inefficiencies.
Beyond that, every day thousands of companies installed in the country register large wastes in the management of their productive factors (equipment and machinery, supplies and raw materials, work, time, capacity and knowledge of human resources, etc.) due to inadequate control of these and the lack of a well-defined operational policy, implemented and executed.
Likewise, time is wasted due to redundancies in tasks, functions and / or processes, and factors that directly affect it. Likewise, in relation to this issue, in recent days a study prepared by the Communication Council established that each year Mexican workers lose 23 million hours in production processes, representing a cost of 8 billion pesos for companies and the government, due to various personal and family problems.
Productive factors exist a great amount, varying or depending on the economic activity, the industry and / or the company in question. However, despite this great diversity, factors of production are frequently classified into four generic groups: labor, capital, land, and entrepreneurship.
In this contribution, the author seeks to establish the differences between waste and waste, clarify the importance of eliminating waste in daily human activities and, specifically, in those related to industry and companies, in order to manage it and establish the culture of maximum taking advantage of all kinds of resources that a human and professional has in the day to day of their activities.
Introduction
In recent years, topics such as Lean Manufacturing, Just In Time and Kanban had an important boom in the world, mainly in aspects related to production and / or manufacturing processes of the most important manufacturing companies in the world, basically in the automotive industries, chemical-petrochemical, pharmaceutical and food.
Along with this, the emergence of production-based philosophies-methodologies and production tools in the countries of the East to increase the levels of operational efficiency and that when integrated increased the levels of efficiency, productivity and financial success of many Japanese companies, they have caused that in the last decade these methodologies had an incomparable interest and great impact on the big corporations on the other side of the world, that is, in our Western region.
Currently these concepts-theories-philosophies-methodologies and / or production tools have been integrated with new business management concepts such as Administration for Operations / Administration for Operations, Logistics and Supply Chain Management / Supply Chain Administration, management models that burst onto the scene of business, international trade, manufacturing processes, distribution and general movement of materials (products) in the last decade and that are seen on the world scene as alternatives that offer companies cost reduction, of response times and the possibility of staying competitive.
All these tools are useful today for any type of company, be it in the industrial, commercial or service sector, and its principles are feasible to extrapolate and adapt to all kinds of human organizations under a concept of cultural transformation, whenever its origins are based on an oriental culture with a focus on high quality, efficiency and continuous improvement.
Why is Asia more competitive than Mexico?
Today, Mexico and Latin America are still uncompetitive regions worldwide, since manufacturing costs in the region remain high and the final quality of products and services low, meanwhile, Asian countries such as China, India, South Korea, Singapore, Taiwan, Hong Kong, Indonesia, Malaysia, the Philippines are currently emerging markets in constant development of their manufacturing industries. International markets have been invaded in the last decade by Asian-made products, at low prices and in large quantities.
But why has Asia been able to be more competitive in the world environment than Mexico and Latin America?
Mainly for two basic reasons:
1. Asian countries have adopted and inserted in their business models the various management and production tools listed in the opening paragraphs, have developed first-rate infrastructure that allows them to move-distribute products and merchandise at lower costs through in the world, but above all, Asia has a high culture-based approach to eliminating waste, which translates into million-dollar savings for the nations of that region and for their companies, allowing them to be more competitive in cost.
2. Its legal and regulatory frameworks, as well as its government and business-industrial programs are developed based on a culture focused on high efficiency.
In this sense, even today in Mexico both conditions noted in the previous paragraph do not prevail, since unfortunately the various sectors (public and private) have not found a work approach focused on guaranteeing high efficiency; culture continues to aim for high waste and zero efficiency.
Waste: delete or manage it? The culture of maximum use
But what is waste? What are the biggest wastes that Mexican companies must attack to reduce large and relevant costs that directly affect corporate finances, performance, productivity and competitiveness in international markets? Why Mexico and should your companies focus on it?
As established by the Royal Spanish Academy of Language:
Waste:
1. m. Misuse of something: that course has been a waste of time and money.
2. Residue, disposal of something, garbage, remains that cannot be used. More in pl.: the street was full of rubbish.
In this regard, it is convenient to first distinguish between the two meanings that the concept of Waste has and that in a general way in Mexico get confused: Waste and Residue. Even today many professionals in Mexico understand waste exclusively as waste, what is left over, the garbage, the remains of something that cannot be used, which is why the importance of managing waste is minimized from the meaning that it is “ a bad use of the various resources ”. In this understanding, Waste is a feasible resource to be managed properly to give it the maximum use.
Many times, and apparently, in organizations there is no waste because there are no wastes, tangible residues, which is why waste is sought to eliminate and not manage, as is the case of the value proposition of the philosophies-methodologies dealt with in lines previous.
What should be understood by waste or waste?
A production process uses raw materials, machines, natural resources, labor, technology, time, information, and financial resources, generating products or services as a result of their combination. In each process, value is added to the product and then it is sent to the next process. Resources in each process add value or do not. MUDA (which in Japanese means waste or waste) involves activities that do not add economic value.
So waste in this context is any misuse of the resources and / or possibilities of companies. Both hours of work are wasted due to ineffectiveness in scheduling and planning tasks, as well as possibilities of winning new markets due to lack of quality products or excess production costs.
According to the classification developed by Taiichi Ohno (mentor and creator of Just in Time), there are seven types of MUDAS:
1. Overproduction molt.
2. Inventory move.
3. Removal of repairs / rejection of defective products.
4. Move of movement.
5. Processing molt.
6. Waiting move.
7. Transport change.
Muda by overproduction. From the point of view of specialists in the area, this waste is the product of excess production, the result, among other factors of errors in sales forecasts, production to the maximum to take advantage of production capacities (greater use of costs fixed), achieve optimum production (lower total cost), overcome problems generated by peaks in demand or production problems. Whatever the reason, which in traditional factories is usually the sum of all these factors, the total cost for the company is higher than the costs that in principle manage to be reduced in the operations sector. In the first place, there are the costs corresponding to the storage, which involves both the physical space and the tasks of handling, controls and insurance.But in addition the financial costs must be taken into account due to the money with little accumulated rotation in high levels of stored overproduction.
Move in due to excess inventory. This has many reasons, and it includes both the inventories of inputs, as well as spare parts, products in process and inventory of finished products. The optimal point of orders, such as wanting to insure supplies, raw materials and spare parts due to problems with strikes, lack of receipt on time, remittances with quality defects and wanting to take advantage of low prices or build stock in the event of possible price increases they are the reasons for this important waste factor. In the case of products in process, stock is formed to guarantee the continuity of tasks in the event of possible machine failures, preparation times and quality problems. Loss due to breakage, maturity, must be added to the factors indicated for overproduction.loss of qualitative factors such as quantitative, and passing of fashion or season.
Muda of repair and rejection of defective products. The need to recondition parts in process or finished products, as well as recycling or destroying products that do not meet optimal quality conditions, cause significant losses. To this must be added the losses generated by the expenses of guarantees, technical services, replacement of products, and loss of customers and sales. This is what in terms of poor quality costs is called internal and external failure costs.
Muda caused by movements. This refers to all waste and waste motivated by physical movements that the personnel carry out in excess due, among other reasons, to a lack of ergonomic planning. This not only motivates a lower production per unit of time, but also causes tiredness or muscle fatigue that cause low levels of productivity. A poorly designed workstation causes staff to waste energy on unnecessary movements, constituting the sixth type of waste. For example, locating the departments that provide assistance to value-added work in offices away from value-added producers increases unnecessary movements. The tools, the equipment,the materials and instructions needed to carry out the work must be placed in the most convenient place so that the operator saves energy. In world-class companies, front-line personnel do not have to go for help, but rather demand it so that it goes to them.
Processing molt. Waste generated by failures in layout, physical arrangement of the plant and its machinery, errors in production procedures, including errors in the design of products and services.
Waiting move. Mainly motivated by: the preparation times, the times in which one part must wait for another to continue its processing, the queuing time for its processing, loss of time due to repair or maintenance work, order waiting times, lead times waiting for raw materials or supplies. They also occur in administrative tasks. All these times cause lower levels of productivity.
Transport molt. Wastage linked to excesses in internal transport, directly related to errors in the location of machines and systemic relationships between the various productive sectors. This causes expenses for excess manipulation, which leads to over-use of labor, transport and energy, as well as spaces for internal transfers.
In the first place, overcoming these wastes requires an improvement both in quality and maintenance, improvement in preparation procedures (long preparation times lead to excess inventories of products in process), the best selection and long-term contracting with suppliers and a better overview of supplies and parts during the production process.
Despite the classification made by Ohno, today some specialists have identified new MUDAS in multiple companies, among which the following can be mentioned: Waste of energy (electricity, fuel and / or steam); excessive expenses due to unproductivity due to lack of management control; bad management of treasury, credits and collection; talent and human capacity; design and manufacture of products with more functions than necessary; expenses and overinvestment for the required production; supervision and control of all processes; imbalances in workload.
Likewise, the so-called strategic MUTES made up of the wasted capabilities of the employees have been identified; lack of focus and positioning; weather; information; waste in the opportunities of the environment; waste of the strengths of the company and loss of customers and consumers, which according to some specialists can be summarized in a large MUDA constituted by the lack of planning. Confirming the famous phrase that expresses "not planning is planning for disaster."
conclusion
As we can well see, waste is a factor generating unproductivity, high costs, long cycles, costly and long waits, waste of resources, loss of customers and quality defects, all of which cause the loss of market share, with a drop in profitability and levels of consumer satisfaction.
The detection, prevention and systematic elimination of the different types of waste that organizations have implies the need for strong leadership, participative administration, discipline and work ethic, firmly conceived plans and strategies, measurement and information systems adapted to these needs. and a strong conviction of the management for generating and supporting continuous training plans. Being aware of the different types of waste and the importance they assume for the company, and educating top management, middle managers and staff in general about the need to identify and eliminate waste is the priority goal, since without firm conviction and clear understanding of the situation and the dangers that this brings not only for the organization,but also for its managers, employees, consumers and society as a whole, it is not possible to establish objectives and achieve goals.
Eliminating waste implies that through the continuous improvement of each and every one of the processes and activities involved in the management of a company, it is possible to constantly exceed the levels of performance. Fewer defects, higher productivity levels, lower costs, better satisfaction levels, shorter delivery times and shorter design and market cycles are essential today for companies and their supply chains to stay competitive.
Consumers are no longer willing to finance or take over corporate mismanagement. Societies no longer bear the waste of resources and the misuse of energy sources and fuels.
Global overheating is proof of this. The market and nature have always been unforgiving, but today they are more so. Only companies and nations willing to increase their total quality levels, thereby achieving more productivity and competitiveness and better use and exploitation of resources, will be able to preserve their businesses and societies with a reduction in the final cost. An organization, company, country or society that does not control its waste, that has no knowledge of it, and that therefore does not establish suitable measures to prevent and / or eliminate it, will continue to produce products and services of poor quality, with high costs and poor customer service and or citizens.
From Lean Manufacturing to Supply Chain Management, in one sense or another they establish the elimination of waste as one of the primary themes for the success of these initiatives and guarantee successful results for the implementing companies. That is to say, they do not seek anything else but a Management of Excellence, more effective, effective and efficient of all the resources of the company, of the inputs or raw materials, passing through the best use of the assets of the companies and the capabilities of the senior executives, executives and operating personnel and staff in general, under the premise that this will eliminate large amounts of waste, which translates or results in higher productivity, lower operating costs, higher quality of products and services delivered to the market, more customer satisfaction, higher sales and profits,which together, increase the levels of competitiveness.
The implementation of management models of this type is becoming increasingly urgent among the organizations installed in Mexico, in all sectors, and in the world in general, in order to reduce the high risks that due to the misuse of resources we are facing and we will have to face in the future.
Article prepared for APICS Mexico Chapter.
