Have Less Inventory & Less Waste – Reason 16

Have Less Inventory & Less Waste – Reason 16

I have spent more times than I would like to remember walking through warehouses, production floors, and office buildings.  Guess what they all have in common…WASTE and EXCESS INVENTORY.  Before you get all over production and manufacturing (yes, we all know there is waste there), don’t forget all that paper for print jobs that never gets picked up off the copy machine, or the tens of thousands of pieces of marketing literature that never gets used, or technology that isn’t used to its capacity.  What this really means is that they’ve lost profits all over their facilities.

I can go on and on with examples of waste in companies of every size and in every industry.  When we get to the root cause of the waste and excess, it boils down to a few reasons:

  • apathy – the people don’t care about waste or inventory because it makes their job harder
  • mistakes – they purchased supplies, equipment or software that is more than is needed
  • budget usage – they had money in the budget and didn’t want to lose it for next year
  • sub-optimized P&L – they don’t pay for the excess or waste, and just wanted to have more on hand, just in case
  • vendor familiarity – they have long time vendors and don’t check for value, and takes whatever the vendor sells them

When your company is working from a mutual benefit culture, your employees understand that the waste and excess is hurting the company that they benefit from.  Employees will work together to find ways to:

  • reduce the amount of what they purchase
  • communicate what’s needed so the correct equipment and supplies are ordered
  • streamline their process in order to allow just in time manufacturing, distribution and procurement
  • develop methods of feedback that will allow marketing to only create what’s needed to drive sales
  • share best practices across departments

When your whole team understands how their actions affect the whole organization, then you will find substantial reductions in waste and excess.  We should look at nature to see how everything is used and everything benefits from the other.

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