Your Complete Guide to Smart Warehouses

Outdated warehousing systems once consisted of massive storage spaces, pen-and-paper logging systems, and a vast team of human employees spending their shifts tracking down inventory across the facility. Thankfully, smart warehousing has made those days a thing of the past. 

The process of integrating modern technologies to renovate existing warehousing operations, smart warehousing offers a host of benefits to organizations that are willing to invest in the change. Some upfront hurdles do exist, but overcome these, and you can expect to see significant improvements in your warehouse operations. 

In this article, we’ll review the principles behind a smart warehouse and show you which technologies you can implement to bring yours up to speed. Then, we’ll show you how Incito can help. 

A pair of lean consultants auditing the floor of a smart warehousing facility

What Is Smart Warehousing? 

Fundamentally, smart warehousing describes the implementation of advanced technologies to enhance your warehouse operations. Just as the terms smartphone and smart home denote the integration of sensors and technologies that increase your phone’s or home’s functionality, smart warehouses are fitted with intelligent systems that make their operations more self-aware. Some examples include: 

  1. Internet of Things (IoT) retrofittings to capture important inbound and outbound product data
  2. AI-powered management systems to predict the need for reorders, restocking, and potential supply-chain bottlenecks
  3. Automated storage and retrieval systems (ASRSs) and automated inventory control (AIC) to optimize your warehouse processes
  4. The use of robots, cobots, and automated guided vehicles (AGVs) to work alongside human employees

By incorporating these technologies into their existing processes or using them to replace legacy systems altogether, companies can boost not only their warehouses’ performance, but also their operational efficiency as a whole.

The Top 5 Smart Warehousing Technologies 

5G, the Internet of Things, predictive analytics — these are just a few of the top smart warehousing technologies that companies can implement to transform their facilities into the storehouses of the future. They’ll need to carefully strategize before they choose which technologies are appropriate to bring into their current infrastructure, but these top five have consistently proved to be the most helpful. 

1. Automated Storage, Retrieval, and Control

One of the first steps on the road to smart warehousing is leveraging automation to transform how you store, retrieve, track, and ship your inventory. ASRS and AIC platforms optimize your warehouse management processes, using a range of technologies to help you streamline your operations. Some of these include:

  • Pick-to-light
  • RFID tags
  • Voice-automated picking
  • Retrieval automation systems
  • Barcode tracking 

Some of these automation technologies serve to reduce picking errors, while others reduce processing times, but the goal of them all is the same: to make your warehouse run better.

Two lean consultants speaking with a smart warehousing staff member at the facility

2. IoT Devices

For your automated technologies to know which items must be processed and how best to process them, they need a comprehensive IoT network to collect the data behind them. IoT devices can consist of either hardware or software, and their purpose is to transmit and store data surrounding your inventory, enabling you to operate more efficiently. Some IoT devices that you might integrate into your smart warehousing operations are: 

  • Sensors 
  • Modems 
  • Routers 
  • Robotic actuators 

Powering the IoT world is 5G technology, as conventional 4G transmission lacks the speed and capacity to transfer so much data.

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3. AI

Having all that data at your disposal is of little value if you can’t turn it into actionable insights. AI’s algorithms and machine learning capabilities have never been more advanced, and leading-edge manufacturers are leveraging them to make their warehouse operations run smoother than ever. Some examples are: 

  • Using predictive analytics to anticipate when supplies must be reordered, enabling just-in-time manufacturing 
  • Anticipating shifts in consumer trends and adjusting inventory levels accordingly
  • Optimizing warehousing processes by maximizing available space and minimizing retrieval times
  • Coordinating layouts and routes for automated vehicles to navigate

Recent advancements have proved that AI is still in its early phases of maturity, but it’s already making warehouse processes more efficient. The result is greater productivity, higher accuracy, and faster shipping times — and, ultimately, greater profits.

4. Robots and Cobots

If AI is the brains behind your smart warehousing system, robotic machinery is the muscle. Robotics have become a staple across the manufacturing and warehousing industries, helping humans perform tedious or dangerous tasks with greater precision than they could on their own. Some examples of robotics in warehousing are: 

  • Robots that perform tasks autonomously
  • Cooperative robots, or cobots, which perform tasks in tandem with human users 
  • AGVs, which reach their destination via a preprogrammed path with the help of IoT sensors

Some overlap exists between these categories, as some AVGs may double as cobots by being partially operated by human users. Regardless of their terminology, they bring greater efficiency, productivity, and accuracy to your operations than humans ever could. 

5. Warehouse Management Platforms

Warehouse management software (WMS) is the command center that ties together all the other components of your stack, making it the core of your smart warehousing infrastructure. It’s where the data from your IoT sensors goes to get processed by your AI algorithms, where it’s then directed toward the ASRS and AIC solutions that regulate your inventory status. Without it, your robots and cobots would have no place to go, so think of your WMS as the hub that unites all of your smart warehousing solutions.

Two smart warehouse employees looking over a tablet during a digital transformation

Optimize Your Supply-Chain Efficiency With Smart Warehousing Technology

Today’s high-speed business world is shaped by a demand for rapid shipping. That places great strain on warehouses to perform at the highest level of efficiency, getting every order right the first time, with minimal delays in transport. 

Smart warehousing reduces the inefficiencies created by outdated processes and streamlines a company’s performance on the whole. Technologies such as AI and IoT empower smarter data collection to avoid supply-chain bottlenecks, while automated hardware and software combine to make the most of your existing processes — and having the right warehouse management software in place is a must. 

Incito’s experienced team of engineers and lean manufacturing specialists have the expertise it takes to bring your warehousing system up to speed with the technology of the future, so contact us today and see how we can help.

How Lean Consultants Can Help You Optimize Your Plant Layout

Achieving a lean plant layout isn’t an easy venture that you can pull off in a day without a well-considered plant layout strategy. You must perform value stream mapping for every step of your business cycle so you know which lean strategies will make your plant more eco-friendly and sustainable.

Although this can be resource- and time-intensive, you shouldn’t lose sleep over it, because lean consultants like Incito have your back. Just schedule a consultation with Incito, and we’ll get you started on the road toward lean plant layout optimization.

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About how Incito can help transform your business and tackle your most important strategic challenges.

    In today’s environmentally conscious world, businesses are increasingly embracing eco-friendly practices to reduce their carbon footprint and contribute to a sustainable future. Integrating lean principles into facility design, specifically focusing on plant layout and design, is a powerful approach to achieving both efficiency and environmental sustainability. 

    This blog explores the synergy between lean principles and eco-friendly facility design, with a special emphasis on optimizing plant layouts for sustainability and efficiency.

    A futuristic production plant utilizing lean principles and eco-friendly methodologies.

    The Marriage of Lean and Eco-Friendly Design

    The five lean principles impact a facility’s design from the initial phase to the project’s completion. These lean principles are:

    1. Value: Customers determine their own definition of value for their plant layout.
    2. Value stream mapping: This identifies the fundamental tasks, steps, and processes that can be optimized to enhance the plant’s eco-friendly value.
    3. Create flow: The plant layout and design should facilitate a smooth flow of goods and personnel to maximize production time while keeping the carbon footprint at a minimum.
    4. Establish pull: The facility design should support just-in-time (JIT) production to avoid overstocking or understocking.
    5. Continuous improvement: The facility design should naturally inspire teams to continually get better at their jobs by seeking ways to optimize their processes.

    Significance of Eco-Friendly Facility Design

    Given that 27% of American consumers are believed to be supporters or members of the most eco-conscious group in society, Planet Protectors, modern manufacturing companies must embrace an eco-friendly facility design. The need for an eco-friendly plant layout is not only a product of consumer demand but also a positive response to the ravaging environmental impact of traditional plant operations.

    The value of an environmentally sustainable plant layout goes beyond contributing to the green economy. A lean plant layout influences four levels of a company’s sustainability:

    • Environmental sustainability: A lean plant layout helps reduce a plant’s environmental pollution.
    • Social sustainability: A lean plant layout promotes overall employee well-being.
    • Governance sustainability: A lean plant layout facilitates compliance with standard industry regulations.
    • Economic sustainability: A lean plant layout boosts the company’s profitability by increasing its operational efficiency and reducing waste.

    The impact of a lean plant layout cuts across all industries, from food and chemical processing to car and textile manufacturing. Overall, regardless of industry, a lean, eco-friendly facility design yields the following core benefits.

    Enhances Resource Efficiency and Reduces Waste

    The founding concept behind the lean methodology is optimizing available resources to get maximum customer value while minimizing waste. To achieve optimal resource efficiency in plant operations and reduce energy consumption and emissions, you must reduce waste in the following areas:

    • Transportation: Streamline your logistics, from materials in transit to deliveries, to operate at maximum efficiency.
    • Material handling: Implement a lean material-handling system to streamline communication and execution of production instructions.
    • Overproduction and overprocessing: Adopt the just-in-time lean manufacturing philosophy to avoid excess production and processing.

    Transportation, material handling, and goods production are some of the major energy consumers and emission sources. Thus, when you achieve optimal efficiency in these areas, you’ll lower your emissions and optimize your plant’s energy consumption.

    Facilitates Sustainable Material Selection and Design

    Following lean principles helps you select sustainable materials and an eco-friendly design from the start. A lean, eco-friendly plant layout includes: 

    When designing a lean plant, your material choices should ideally be influenced by sustainability ratings over other factors such as cost and aesthetics. Evaluate your future sustainability goals and benchmark the lean principles when choosing your plant’s design, infrastructure, and construction materials.

    Enhances Employee Engagement and Well-Being

    The social sustainability aspect of a lean plant layout focuses on enhancing employees’ satisfaction, involvement, well-being, health, and general safety. A lean plant layout achieves this by:

    • Enhancing ergonomics safety by providing tools and equipment that minimize body strain caused by insufficient workspace or improper posture
    • Enhancing the aesthetics of the workplace and allocating workers enough space to work
    • Setting up modern safety protocols to enhance workplace safety and avoid injuries 
    • Setting up clear communication protocols that facilitate free interactions among workers

    The lean principles of “create flow” and “continuous improvement” should be your guiding light when it comes to optimizing employee engagement and well-being.

    Lean-Inspired Plant Layout Strategies

    A lean-inspired plant layout strategy should, by default, promote the plant’s overall sustainability. Some of the primary concepts that define lean plant layout strategies include the following.

    One-Piece Flow

    One-piece flow is also called single-piece flow or continuous manufacturing. It’s a production method in which all manufactured goods go through continuous operations step by step, without a work-in-progress phase coming in between.

    To actualize one-piece flow, you must design your plant layout to facilitate continuous production. This involves designing your workspace following the sequence of your work processes so there’s no excess space between processes that would encourage work-in-process buildup.

    Cellular Manufacturing

    Cellular manufacturing is a production system that combines all of the components and equipment of a production line into one integrated work cell. Cellular manufacturing is a key enabler of one-piece flow production. As such, an optimized lean plant layout utilizes both cellular and one-piece flow production to eliminate downtime and achieve optimal operational efficiency.

    Just-in-Time Production 

    Just-in-time production is a lean manufacturing strategy that produces goods on an as-needed basis following customer demand. JIT helps minimize inventory handling costs and enhance resource efficiency by manufacturing the right amount of goods to satisfy existing customer demand. 

    With these three lean-inspired plant layout strategies, you’ll reduce production waste and utilize your manufacturing resources more efficiently. 

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    How Lean Consultants Can Help You Optimize Your Plant Layout

    Achieving a lean plant layout isn’t an easy venture that you can pull off in a day without a well-considered plant layout strategy. You must perform value stream mapping for every step of your business cycle so you know which lean strategies will make your plant more eco-friendly and sustainable.

    Although this can be resource- and time-intensive, you shouldn’t lose sleep over it, because lean consultants like Incito have your back. Just schedule a consultation with Incito, and we’ll get you started on the road toward lean plant layout optimization.

    Want to learn more? Schedule a consultation.

    About how Incito can help transform your business and tackle your most important strategic challenges.

      In today’s competitive, fast-paced business landscape, supply chain management has become a critical factor in a company’s success. A lean supply chain is not just about reducing costs; it’s about optimizing processes, minimizing waste, and ensuring the efficient flow of goods and services. Leveraging artificial intelligence in the supply chain, particularly predictive AI analytics, is a surefire way of achieving optimal efficiency.

      In this blog, we’ll explore how predictive AI analytics can power your lean supply chain, driving improvements in every aspect of your operations. 

      The Essence of a Lean Supply Chain

      A lean strategy focuses on optimizing the efficiency and performance of the entire supply chain. A lean supply chain helps managers enhance their company’s operational efficiency by: 

      • Reducing wastage in resources, time, labor, and inventory
      • Enhancing supply chain collaboration and communication between all parties involved
      • Implementing supply chain optimization strategies
      • Analyzing and predicting customer requirements and developing appropriate strategies to address them

      Modern companies need a lean supply chain to create and sustain a competitive advantage in the industry. Given the substantive reputational and financial damages of supply chain disruptions, every savvy business leader knows that running a lean operation is life-saving in the face of supply chain uncertainties.

      Lean supply chain management is premised on the following core principles.

      Pull-System Production

      A lean supply chain utilizes the pull-based model, in which production is based on actual customer demand instead of demand forecasting. A pull system follows the just-in-time production model, in which goods are manufactured to satisfy existing demand, not anticipated demand. It helps you optimize your inventory levels, leading to lower warehouse and inventory handling costs.

      Continuous Improvement

      In a lean supply chain, leaders, employees, and other concerned stakeholders continuously seek opportunities to optimize their processes. Therefore, companies can achieve maximum operational efficiency by making constant tweaks over time. 

      Cost Savings Through Waste Reduction

      Any process or activity that doesn’t add value to your supply chain operations or enhance your overall customer satisfaction is considered wasteful. Waste includes: 

      • Excess inventory
      • Overproduction
      • Logistical inefficiencies leading to longer transit times
      • Product defects

      A lean supply chain focuses on eliminating these and other systemic inefficiencies that frustrate supply chain operations.

      Customer Focus

      All of the principles of lean supply chain management culminate to advance customer satisfaction. By optimizing your supply chain operations, you can efficiently meet customers’ expectations and offer superior customer service.

      Implementing lean supply chain management requires a well-defined strategy encompassing all aspects of your supply chain operations, from lean inventory management and procurement to supply alignment. An experienced lean supply chain consultant such as Incito is best placed to design a road map for successfully deploying a lean supply chain strategy by tapping into predictive AI analytics.

      The Power of Predictive AI Analytics

      Predictive AI relies on historical data and machine learning to forecast customer demand, identify risks in supply chain and inventory management, and predict market trends. Thanks to ever-growing sources such as smart pallets, web user data, and radio-frequency identification (RFID) tags, modern logistics companies produce crucial supply chain data in support of predictive AI analytics.

      These are the mainstream uses of predictive AI analytics in supply chain management.

      Demand Forecasting

      By leveraging predictive analytics and other AI technologies, such as natural language processing and machine learning, supply chain companies can forecast customer demand for their products and services.

      These AI solutions can pool all of your customer-generated content, such as product reviews, ratings, comments, and community discussions, and analyze the data to predict market trends. The insights derived from the data analysis combined with those derived from studying customer behaviors will help you forecast product demand more accurately. 

      In turn, you can make the necessary adjustments in your supply chain beforehand to satisfy future demand without disruptions. Data-based, AI-driven demand forecasting is more accurate and convenient than traditional forecasting methods, such as running market surveys.

      Streamlining Inventory Management

      Predictive analytics help businesses optimize their inventory levels while avoiding common challenges such as overstocking and understocking. By analyzing past and current inventory data, historical sales data, and consumer behaviors, predictive AI can forecast the sufficient inventory levels for a certain period. 

      Your predictive AI solution can issue instant notifications when your inventory levels fall beyond expected levels or when it predicts a supply chain disruption. This ensures you always have enough inventory to satisfy current and future demand and can outlive a supply crunch. This way, you avoid unnecessary inventory costs, such as carrying costs resulting from excess inventory and forgone sales due to stock-outs.

      Working with a resourceful supply chain consultant such as Incito helps you implement AI-driven inventory management solutions that are in line with your lean supply chain strategy.

      Enhancing Supplier Collaboration

      Predictive AI analytics foster supply chain visibility among all parties involved. With easier data sharing between companies and suppliers, all parties have access to rich data-driven insights. This free flow of information supports collaborative decision-making among companies and suppliers. 

      For instance, by analyzing your historical data, a supplier can leverage predictive analytics to predict the quantity of goods and supplies you’ll need in the future and ramp up production accordingly. The supplier can also analyze your seasonal demand shifts and use machine learning to predict when issues may crop up. 

      Achieving Operational Excellence

      Using artificial intelligence in the supply chain is an authentic way to achieve operational excellence. AI helps you root out existing operational inefficiencies and predict future risks that may impede your supply chain operations. Analyzing your supply chain data using AI solutions makes your warehouse operations, transportation management, and route optimization more efficient. With relevant data, you can develop foolproof plans, ensuring your supply chain operates at optimal efficiency.

      Tyson Foods is one of the top brands that have successfully implemented predictive AI analytics in their supply chains. Tyson leverages Power BI, a business analytics solution from Microsoft, to optimize its inventory levels and minimize its time, resource, and labor wastage.

      How to Build Resilience in the Supply Chain With AI

      To build a strong supply chain that stands the test of time, you need a solid strategy that involves the following best practices: 

      • Have an experienced supply chain expert on your team or consult a seasoned supply chain consultant such as Incito.
      • Build more personal relationships with your suppliers.
      • Engage different suppliers to get a second option in case of a disruption.

      Understandably, building a lean supply chain centered on predictive AI analytics is a complex undertaking. But when you partner with experienced lean consultants, implementation and maintenance can be fast and efficient. 

      Contact Incito today and begin your journey toward a lean supply chain. 

      Want to learn more? Schedule a consultation.

      About how Incito can help transform your business and tackle your most important strategic challenges.

        As forward-thinking organizations develop strategies to scale and grow, they recognize the need to establish world-class efficiency throughout the entire sales cycle, from attracting the right customers to long-term customer satisfaction and overall customer retention.

        If your sales teams seek to optimize every sales opportunity, gaining an in-depth understanding of your quote-to-cash (Q2C) process is an imperative first step. Assessing your quote-to-cash process using tools like value stream mapping (VSM) can give you an end-to-end view of your business.

        Learn more about the quote-to-cash process and its key elements below. Then, explore common challenges businesses face and learn how lean strategies can help improve your efficiency and accuracy. Finally, find a solution with an Incito consultant, who can help you improve your Q2C sales systems.

        What Is the Quote-to-Cash Process?

        The quote-to-cash process encompasses the entire sales cycle, from the moment when you present your product or service to the time when you collect revenue from the sale. The Q2C process may include quoting and ordering, generating sales, committing resources, and delivering to customers on time.

        Some businesses confuse the Q2C process with the order-to-cash process. While the order-to-cash process does include the steps it takes to fulfill orders, it does not include essential parts of the Q2C process, such as contract management and revenue recognition.

        In essence, order-to-cash may be viewed as a process or subset of the entire quote-to-cash value stream. When seamlessly integrating these two value streams, organizations can provide a world-class purchasing experience for their customers.

        order to cash

        Key Elements of Quote-to-Cash Value Streams

        The key elements and steps in the Q2C process include the following.

        Offers, Pricing, and Quotes

        The sales team must use customer information and requirements to create offers and quotes that include the necessary details to complete a sale. The team must also develop a pricing strategy, which may include promotions and discounts. The process may include sending sales order acknowledgement forms and entering data into the company’s customer relationship management (CRM) platform.

        Contract Management and Renewal

        After a customer accepts a quote, the business must conduct negotiations and draft a formal contract with all of the terms. The business also has the opportunity to retain existing customers by renewing contracts. The renewal period has excellent cross-selling and upselling opportunities, through which you may add other products or services to the customer’s order. 

        Order Management and Fulfillment

        An order management system can ensure that you have everything you need for order fulfillment. This could include an inventory management system that effectively allocates resources and automatically orders materials when needed. Order management and fulfillment also require scheduling for assembling and shipping products.

        Billing, Invoicing, and Revenue Management

        After order completion, finance teams must take over to create invoices and properly enter transactions. These systems must be in place to reduce invoicing errors and optimize cash flow. In addition, the finance department must properly manage revenue by following revenue recognition principles, which is especially important for businesses that handle recurring revenue.

        Why Businesses Struggle With the Quote-to-Cash Process

        The many elements of quote-to-cash workflows can create confusion if not managed properly. Unfortunately, many businesses face challenges with their Q2C process, which can result in a poor customer experience, low customer retention, and delayed business processes. 

        Offers, quotes, and invoices may face errors throughout the process. This could include issues such as noncompetitive pricing, delayed responses to customers, or simple mistakes on invoices that slow down payments. Any errors with these steps will result in more time being spent reviewing the documents and fixing the errors, instead of getting them approved quickly and moving on to order fulfillment and payment processing.

        The sales process must also be set up to benefit the business’s bottom line through efficient contract management. Not only does this process require accuracy, but contracts also need to be eligible for renewal in a reasonable amount of time to allow for regular check-ins regarding customer satisfaction and upselling opportunities. 

        Some other issues that may arise with the quote-to-cash process include inaccurate revenue recognition, delays in order fulfillment or shipping, low workforce productivity, or ineffective e-commerce platforms.

        How Lean Strategies Can Improve Your Quote-to-Cash Value Stream

        A core tenet of a lean strategy is to continuously analyze your processes to search for areas of improvement. The method helps businesses implement systems that are accurate and efficient, which can lead to more satisfied customers and higher revenue when implemented correctly.

        Value stream mapping is often used in lean strategies. With this tool, a business creates a flowchart outlining the steps its processes require. When using VSM for your quote-to-cash sales process, you can see what steps are being handled efficiently and what might need to be reworked. Assess the following to enhance your Q2C process:

        • Organizational alignment, roles, responsibilities, and skill sets
        • Policies, procedures, and escalation protocols
        • Technology, workflows, and data integrity
        • Overall sales process, from lead generation to customer order and beyond
        • Inventory management, supplier management, and order management systems that determine the availability of products or services
        • Invoice management, payment processing, and revenue management
        • Data analysis for KPIs and benchmarks, such as on-time delivery rates, cycle times, and lead times

        A VSM flowchart that outlines the essential elements of your quote-to-cash process can help you determine your accuracy, efficiency, speed to market, and more.

        Contact Incito Consulting for Help Implementing Lean Strategies

        It has become imperative that businesses leverage value stream mapping to make critical decisions about their quote-to-cash process. VSM can have a significant impact when you’re making critical decisions, such as restructuring teams, adjusting business models, shortening decision chains, and streamlining your overall processes.

        Incito offers Q2C value stream map coaching that can help you identify your sources of waste, prioritize improvement opportunities, track KPIs, and develop a schedule and road map for future enhancements to your quote-to-cash process. Unlike SaaS programs that are focused on solving specific issues within your organization, an Incito consultant can help you identify and solve issues across many departments and systems. 

        To learn more about how Incito can help, fill out the form below.

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        About how Incito can help transform your business and tackle your most important strategic challenges.

          Maximizing productivity and reducing waste is every company’s goal. Lean manufacturing methodology has recently gained much popularity because it focuses on this principle. It is a common practice adopted by companies like Toyota, Intel, and Nike. This method has also influenced industries outside the manufacturing world, such as software development and healthcare industries. 

          Additionally, lean manufacturing can lead to higher efficacies, more valuable outputs, and reduced costs. Not only this, but companies can expect quality performance and faster development. Here are the 8 wastes of lean manufacturing and how to eliminate them.

          1. Defects

          This type of waste can be defined as loss of value due to repair or lack of poor documentation and standards. In other words, defects can be known as a lack of quality control. Furthermore, high levels of inventory, inadequate training, and poor machine repair are all factors that can cause defect waste. Defects have huge consequences such as extra costs, loss of resources, and dissatisfaction of customers, which can lead to a business’s downfall. 

          Designing a process to help your company detect defects during production can help to eliminate this type of waste. Formalized document control and ensuring the use of qualitative methods can significantly improve defect management. 

          Moreover, for companies to maintain a consistent management process, they must focus on improving the quality of their work. Incito helps you do just that. Consultants at Incito help to eliminate functional waste. They use value stream maps to visualize how companies can meet the needs of their valued customers.

          2. Overproduction

          As the word suggests, overproduction means producing faster or more than needed. This is also known as the “caterpillar effect”. Lack of proper planning and communication, local optimization, and low uptimes can all lead to overproduction. 

          Overproduction can cause a considerable loss of money — the most of any of the 8 lean manufacturing wastes. It produces vast amounts of unsold goods that would be useless to the company. Moving the unsold or work-in-progress components would also require additional labor costs.

          Organizations can create a made-to-order philosophy by correct planning and forecasting. Ensuring employee training can also reduce this type of waste. Moreover, Takt time balances production rates between units, and Kanban systems can also help to reduce overproduction. 

          Incito uses tools such as Kanban cards to make it easier for management to inspect product progress at any time. They also design supply chains for companies that help to minimize the risk of over-production. 

          3. Inventory

          This waste is produced due to an unprocessed inventory. The inventory waste usually consists of work in progress, raw materials, and finished goods. Poor forecasting, poor management, and over-purchasing are some elements that can cause inventory waste. 

          Inventory waste can cause a potential loss of customers due to inefficient deliveries, resulting in a massive loss of revenue. Additionally, this can also damage production materials. 

          Companies and organizations can eliminate inventory waste by buying the correct quantity of materials only when required. Ordering small batches of raw materials and products could also reduce inventory waste. Furthermore, companies can reduce this waste through careful planning, purchasing, and forecasting.

          4. Waiting

          This type of waste includes inventory or machinery that sits idle. It is likely caused by defective equipment, poor machinery and skill, improper work methods, and long setup times. It can cause a loss of customers and result in other lean manufacturing wastes like excess inventory and overproduction. 

          Businesses can eliminate waiting by using the process of Takt time and improving communication. Companies should also balance workloads by using proper instructions and hiring skilled workers who can meet work demands. Additionally, by reducing waiting time, companies can ensure a smoother workflow and reduce bottlenecks in the production process. 

          5. Transportation

          Transportation waste means a product that was relocated or touched when it should not have been. Transportation waste is likely caused by poor planning of large distance operations, excess production, and multiple storage facilities. This can result in possible damage to the product and unnecessary transportation costs. Moreover, it can cause additional waste such as waiting or motion, which can cause high fuel costs.

          Creating a U-shape production line could reduce unnecessary transportation. Documenting the entire production process as well as any changes in company layouts can also reduce transportation. Such changes could save money and speed up manufacturing.  

          6. Excess Processing

          Excess processing means putting unnecessary effort into a product that adds no value. This could mean doing extra work, having more steps than needed in service, and including more components than required. It could be due to poor management issues such as data replication and lack of communication. 

          Insufficient customer input could also be a possible reason for this type of waste. Overprocessing can result in loss of resources and frustrate workers who are putting in the extra effort. 

          Process mapping is a great tool that can help eliminate excess processing. With process mapping, companies can keep track of performance reports, signoffs, and documents. Customer input is also essential. Companies should keep their customers updated every step of the way. This will ensure a smooth workflow with little to no overprocessing waste. 

          7. Motion

          Motion waste includes excess physical transport of raw materials, equipment, and people, like unnecessary lifting, bending, or buying of tools. It could also include searching for documents, going through the inventory, or readjusting a component already installed. 

          These motions don’t add any value to the manufacturing process and only increase cost and time. Additionally, unnecessary movement can cause damage to machines and injure workers. Poor planning and process design can result in this type of waste.

          To eliminate motion waste, companies should redesign their entire workstations. Companies should also aim for process mapping so the workspace can be adequately utilized. Moreover, to reduce straining and stretching, materials should be kept in a convenient position. 

          8. Non-utilized Talent

          This type of waste means the talents of employees are not being utilized. This could happen if management overlooks their talent and assigns them work or tasks they have not been properly trained for. Lack of teamwork and poor communication skills can cause non-utilized talent waste as well. As a result, talent may be poorly utilized, putting companies at risk of high turnover rates and employee dissatisfaction. 

          A reliable solution for eliminating non-utilized talent can be communicating with employees and considering their ideas. Additionally, companies should also provide them with the proper training and opportunities. 

          Incito provides training for company executives and support for management and staff to ensure employee talents are recognized and appropriately used. We help your company build a strong culture through coaching and collaborative work. Organizations can also take the initiative of creating a reward system to keep their employees motivated.

          Work with Incito to Eliminate the 8 Wastes of Lean Manufacturing

          Incito is an organization that aims to change how the world does business, helping your company gather the right tools for your enterprise. We create refined methodologies to increase your company’s flexibility and improve labor efficiency. In fact, because of Incito’s services, companies can expect an increased return on their investments. 

          Contact us today to learn how we can help your company eliminate the 8 wastes of lean manufacturing, scaling your production process to the next level.

          Want to learn more? Schedule a consultation.

          About how Incito can help transform your business and tackle your most important strategic challenges.

            In today’s competitive business world, companies constantly look for ways to reduce waste and redundancies in their processes as they strive for continuous improvement.

            Value stream mapping can help businesses identify and eliminate redundancies and other risks before problems even arise. By mapping out all the steps involved in a process and identifying how each stem contributes to the value stream, businesses can quickly and easily identify bottlenecks and time-wasters and find ways to improve.

            Once these problems have been identified, it is easier to work out a solution that will not only save costs but also improve the quality of the final product or service.

            This information can then be used to improve efficiency and reduce the need for human input, thereby reducing logistical costs and eliminating potential opportunities for error.

            What Is Value Stream Mapping?

            A value stream map, also known as a flowchart, is a visual diagram illustrating the sequence of activities in a manufacturing or service operation.
            It is a methodology that aids in identifying and tracing the steps involved in obtaining a product from inception to customer delivery. It is widely used in manufacturing and service organizations.

            Value stream mapping involves the process of value stream management, which gives business leaders a better understanding of how their organization’s products are created, processed, and delivered to customers. This knowledge can help them identify opportunities for waste and Improve efficiency by cutting out steps that don’t add value to the end product.

            History of Value Stream Mapping

            The value stream mapping process was first developed in the Toyota Production System in the 1960s and has since been used by many other organizations to improve efficiency and quality.

            When Toyota began producing automobiles in the early 1900s, manufacturing a car was very time-consuming and expensive. Due to this, Toyota believed that removing non-essential activities from their production process would make their vehicles more efficient and cost-effective. Toyota initiated a value stream mapping initiative in the late 1950s. This initiative aimed to help improve coordination throughout their production system by tracking all aspects of the product life cycle. This process mapping allowed Toyota to anticipate better demand for their products, which improved customer satisfaction ratings.

            Later on, this process was associated with Lean, and Six Sigma was adopted by many businesses to improve efficiency and decrease cycle time.

            What Is Value Stream Mapping in Lean Management? 

            Developed from lean manufacturing, value stream mapping is a tool that allows a business to see each component of its supply chain. This allows the business to understand every step involved in product delivery to streamline the process where necessary. 

            Value stream maps help businesses see where there may be inefficiencies and redundancies in their information flow and change these processes for optimum service delivery. 

            Why Create a Value Stream Map?

            Creating a good map takes effort as well as time, so why do people do it? For one, these visual tools aid in continuous improvement. By optimizing business processes, you can consistently offer better service to your customers, which enables you to stand out among the competition and solidify your reputation as a trusted provider. The purpose of lean value stream mapping is threefold:

            • To understand where your business currently stands regarding its processes and information flow
            • To spot waste in the form of problems and inefficiencies and create a plan to fix them
            • To build a vision of the future that your company can pursue by following key steps

            When it’s done well, lean value stream mapping lets you significantly streamline your business processes to save time and effort down the road without compromising customer service. Value stream mapping can help in various fields, including the following. 

            1. Manufacturing

            With a value stream map of your manufacturing process, you can begin identifying waste and work to reduce or eliminate it. Additionally, you will be able to monitor the flow of materials and products through your factory, which will help determine where improvements can be made. Implementing process mapping into your manufacturing process can create a more efficient and effective production line. Lean value stream mapping can also help you develop strategies to withstand supply chain disruptions.

            2. Service Operations

            Service operations benefit from value stream mapping in several ways. By understanding the flow of customer calls and responses, you can identify areas that require improvement. In addition, you can see where efficiencies could be achieved by tracking the resources used in delivering services. This way, you can ensure that the right resources are used to deliver optimal customer service.

            3. Software Development

            In software development, value stream mapping can provide critical insights into managing and coordinating projects. By tracing the steps involved in developing a new product or application system, you can track down dates and details that may have been missed during the planning phase. Process mapping also helps visualize dependencies between different parts of an application system so that changes to one area don’t impact other parts unpredictably. With this information, developers can plan their work more effectively and build reliable systems.

            Value stream mapping is a comprehensive and time-consuming process, but with the help of a professional consultant, it doesn’t have to be.  An Incito value stream map consultant can walk you through the entire mapping process, from gathering data to identifying problem areas to improve your business efficiency.

            Examples of VSM

            The original lean value stream mapping process emerged from Toyota’s material and information flowcharts. These diagrams demonstrated the company’s plans for how its various processes would work in a clear, easy-to-understand way. 

            In the time since these diagrams have been refined. The image below demonstrates what a modern VSM chart might look like, including issues such as the time it takes to accomplish a process, the time between each process, and how information flows through the department. 

            What Are the 4 Steps of Value Stream Mapping? 

            You can create value stream maps for any process within your business by following these steps.

            1. Identify What You Want to Map

            Start by identifying which of your processes you want to improve with value stream mapping. Use this to identify the start and end points of your process and develop your map by filling in all the spaces in between. 

            You may choose to evaluate only part of a process or department instead of a whole process. For example, if the amount of time it takes to deliver your products is increasing, you may want to evaluate your shipping and delivery process. 

            2. Map Your Current Process

            Convene a group of stakeholders who manage each part of the process you’re mapping. Include people at all levels to produce an accurate visual tool that illustrates the process in detail. You may choose to look at material flow, information flow, production flow, or other process improvements.

            3. Analyze Your Current Value Stream

            Once you have your process completely mapped, identify value-adding activities at each step. For example, if you’re mapping your sales and marketing process, each step of the value stream potentially benefits the company. 

            Your marketing team may run a lead-generating campaign that brings potential customers into the funnel, and the sales team may use these leads to generate sales. In this example, the sales process would offer more value, because customers who make it to this step of the process are more interested in making a purchase. 

            Discuss which parts of your existing process contribute to the value stream and eliminate those that offer no value.

            4. Create a Future Value Stream Map 

            After you’ve gone through your processes to determine which activities add value to your company, you can start creating your future map. Identify potential bottlenecks and other parts of the process that result in waste, including excess inventory and other post-process waste. 

            Find parts of the process that could be consolidated for greater efficiency. Use the results to develop a future value stream map with a leaner process. Showcase how you’ll reduce your lead time and identify other performance indicators to measure success. 

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            How To Perform Value Stream Mapping

            How do you put these steps into practice? Value stream mapping can look confusing, but it gets easier once you get into the process. Here’s how you can start performing value stream mapping within your company or a specific department. 

            1. Choose Your Value Stream Mapping Team

            If the waste value stream mapping is for your entire company and your inventory, you need to include stakeholders from every department. Identify an organized person with experience in project management to lead the team. Try to put together a team of about ten people to ensure you have a variety of perspectives without creating an unmanageable team. Choose representatives from each level who are involved with the processes you’re using for your value stream maps.

            2. Schedule Your Kaizen Event

            Lean kaizen events are three-day project management events in the value stream mapping process during which you:

            • Day one: Explain value stream mapping, put together process families, and gather information about your current continuous processes.
            • Day two: Draw a current state map and train your team in lean concepts if necessary. 
            • Day three: Create a future state map and draft a plan for how you’ll reach that future state.

            Ideally, you should have at least one person on hand who’s experienced with lean value stream mapping to guide the process. Incito’s expert Value Stream Mapping consultants can help guide your team through the process, whether in person or virtually.

            3. Determine Your Process Families

            A process family is a collection of processes that use the same resources or involve similar steps. You’ll need to develop process families for every department or area in your business.

            To find your process families, create a matrix or spreadsheet. Along the top, name every process involved in a specific department. Along the side, list the product your company uses in its processes. Place a mark in the boxes where a process intersects with a product it requires. The methods with a substantially similar collection of marks are part of a process family. 

            4. Choose Where to Focus First

            In one three-day kaizen, it’s unlikely that you’ll be able to refine every process family in your business. You can choose which families to focus on by asking questions such as:

            • Which steps take up most of your company’s time and resources?
            • Which steps matter most to customers?
            • Where do you think you could make the largest difference?
            • Where do you think you have the most significant likelihood of succeeding?

            Pick one process family to focus on for the remainder of the kaizen based on how you answer these questions. 

            5. Create a Current State Map

            A current state map is a flowchart explaining how a process or family of processes works and how it contributes to your value stream. Current state mapping begins with learning from the people who perform each task. Take your team to speak to the people on the ground and walk through each step of the process or production flow to gather information and spot inefficiencies. Take notes on lead time and other important parts of the process. 

            Improve your value stream mapping efforts by making sure you learn about the product, how inventory is stored, and what actually takes place during the process. Once you’ve gathered data, you can put together a flowchart that shows how the company accomplishes tasks and creates products or services right now. Incito value stream mapping workshops can help you learn how to structure these maps most effectively.

            6. Create a Future State Map

            This map will explain how the steps to perform a process will look in the future. Your future state map should include the time it takes to move a product through each step in a process and how it resolves issues like bottlenecks or waste. It should also clarify who’s involved in each step. Most importantly, it should include a clear, easy-to-read key so people who weren’t involved in the development process can understand it. That way, you can ensure the continuous quality of your product.

            7. Draft Your Initial Plan

            Now you need to draft your initial plan explaining how you’ll move from your current state into that future state. This plan won’t be your final one, but it will be a good start. 

            To save time and make refining the plan later easier, include details like:

            • What changes you’ll make
            • How those changes could be accomplished
            • A schedule for how you’ll proceed through the plan
            • Potential team members
            • A cost estimate
            • The projected impact of the changes

            Is Value Stream Mapping a Lean Tool or Six Sigma? 

            Value stream mapping is a lean management technique that is similar to Six Sigma in that they both aim to make your business and project management more efficient. Value stream mapping is a visual tool for evaluating material and information flow to identify inefficiencies and reduce waste.

            A value stream map allows you to offer consistent, high-quality service to your customers by delivering products or services faster without sacrificing quality. 

            Six Sigma helps you make your processes more consistent by reducing defects and variations. You can use value stream maps to evaluate your product life cycle, from raw material to delivery. Six Sigma is more useful when you’re examining specific processes. It’s not a tool for eliminating waste.

            Learn More About Lean Value Stream Mapping

            Properly performing lean value stream mapping is a great way to accomplish continuous improvement within your business, eliminating waste and improving your efficiency. However, it requires a clear understanding of how the process works to implement it correctly. Work with Incito to bring in qualified consultants to train your leadership team on how to get started with value stream mapping, which will make your business more efficient and help you consistently produce the best product and effectively manage your inventory.

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