Two things have revolutionized the manufacturing industry in ways that other contributions have not: the assembly line, and the Toyota Production System (TPS). The TPS was developed over many years by industrial engineers Taiichi Ohno and Eiji Toyoda and is the breakthrough that eventually lead to the lean management movement we know today. One innovative aspect of the system was Ohno’s identification and subsequent definition of not one but three major obstacles to ultimate efficiency: Unevenness or inconsistencies in production or services; tasks being harder than necessary and overly-burdened employees; and waste, which he described as anything that uses up resources but adds no value at all to the product. Today’s LSS practitioners still refer to them in Ohno’s native Japanese, and they are mura, muri, and muda, respectively. While all three are equally important, muda is the most widely known and studied because it is a simple yet powerful tool.

Overview: what is muda?

Muda is one of three recognized deviations that can prevent organizations from achieving their goal of optimal allocation of resources. The word is Japanese for “waste” and it encompasses every aspect of production that utilizes resources yet adds no value.

Ohno’s definition included seven specific types of waste, with an eighth being added in the 90s. They are: defects, overproduction, waiting, non value added processing, transportation, inventory, motion, and unused employee talent.

It was created to be a tool with which organizations can improve a process by identifying the steps that can be eliminated from it, the steps that can be simplified, and the steps that can be standardized. When used in such a manner, it helps organizations discover what gets in the way of improvements.

With muda, your organization examines every aspect of a process, from start to finish. At every step, it asks whether that particular step is necessary, and if not, how it can be eliminated or simplified.

3 Drawbacks to muda

While muda is a powerful and thorough technique for reducing waste, there are challenges nearly everyone faces when going through implementation.

1. It can create a confusing culture.

Focusing exclusively on elimination of waste can sometimes create a culture that prioritizes cutting every single step out of a process rather than focusing on creating value from the customer perspective. That’s why lean practices are often supplemented with continuous improvement initiatives, so that managers can focus their efforts on improving processes rather than cutting them down to zero.

2. There’s a high initial cost.

The technique of muda can be costly to implement, depending on how much training and manpower is needed. Additionally, its focus on process improvement means that over time your organization will require more people to support it. However, if done right, these costs are worth it in the end: after implementing muda in an organization, many benefits can be realized.

3. You will be called upon to make difficult decisions.

Another main drawback to the muda philosophy is that the prioritization of processes that is required can be difficult. It requires you not only to identify waste in your organization, but also to decide which activities are necessary and which ones can be removed. This is especially true with customer service processes such as sales and support, where features that customers expect may be counted as waste by an outside observer. Practitioners can also find it challenging to do away with some systems, wasteful or not, if they have just been newly implemented at great time and cost.

Why is muda important to understand?

Before any business starts to streamline the processes in their organization, they must first understand if every process does or does not contribute value to the final customer. Muda is the principle by which that is determined, and it can be carried out throughout the product development lifecycle. It is the first and most important step towarwd maximizing efficiency and increasing ROI in your organization, which makes it critical to understand.
Businesses cannot grow if their current processes are burdensome or ineffective at producing the results desired by customers. And in today’s ultra-competitive world where time is money, eliminating activities that are unnecessary can be the difference between staying in business or having to shut down.

An industry example of muda

An example of muda in a real-world setting is the process for purchasing products for an organization. The procurement department often places large orders with vendors, but does not keep track of how many units have been purchased over time or how many are still in stock. The goal is to eliminate waste (anything that does not directly contribute value to the customer) wherever possible. But how can you eliminate waste when you don’t know when it’s occurring?
This is where muda comes into play: a LSS process using muda focuses on creating a leaner, more efficient process by analyzing every step of the existing system and creating breakdowns within it. With this knowledge in hand, improvements can be made based on eliminating waste before creating new products or services or adding additional employees or equipment.

3 best practices when thinking about muda

When implementing muda, make sure your process does not break down. It is essential that you examine every step with a fine-tooth comb, asking yourself whether that particular step contributes value to the customer and if not, how it can be eliminated or simplified. When implementing muda at your company, keep these best practices in mind:

1. Do not let technology get in the way of your true purposes.

Assessing efficiency and eliminating waste should always be the focuses and the goals. Not all technology is needed for all industries; some is superfluous or simply irrelevant and, as such, adding it is simply adding more waste. Don’t assume because it’s advanced it will result in efficiency. Technology at this level must be specifically designed for your industry, and the specific space you want to occupy within that industry.

2. Keep it simple.

There is no need to complicate matters by introducing unnecessary steps into your business. Any chance you have to simplify, take it.

3. Be prepared to deal with resistance.

People tend to resist change until they get used to something new. This is normal and to be expected. But as complete dedication to the mindset is required, be prepared to release members of the team who are never able to get on board.

Frequently asked questions (FAQs) about muda

What does muda mean?

Muda is a Japanese term that refers to waste in a process. In LSS, the principle of muda states that any activity that does not directly contribute value to the customer can be considered waste and should be removed from the process if possible.

How does muda relate to efficiency and effectiveness?

Muda is based on two pillars: effectiveness and efficiency. While the former focuses on understanding how the process is performing, the latter requires you to scrutinize how it works in order to reduce any unnecessary effort. Efficiency improves when processes are clearly defined, while effectiveness can be achieved when goals are well-defined.

When should we use muda instead of a traditional quality improvement process?

You should use muda instead of a traditional quality improvement process when: 1) you want to reduce waste in your business; 2) you have a process that is not making any profit and needs to be improved; and 3) all steps in the entire process, start to finish, need to be considered (as opposed to just one smaller part of the overall process).

Is it time to reconsider your processes?

Ultimately, knowing the fundamentals of how LSS and muda work together is vital in the modern business landscape. The key takeaway here: if you’ve been wondering how to approach certain business problems but can’t get past a certain roadblock, it might be time to reconsider your processes. But be careful not to fall into the mindset that the roadblock is happening because something is missing. Instead, look for what is already there but shouldn’t be.

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