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Overproduction

2. 1. 2018
Štítky

The definition of waste as well as its classification has been approached by various researchers. In general, researchers have commonly included defects and excess processing as some of the more common factors considered as waste (Senaratne & Wijesiri, 2008).

Additionally, other factors have been mentioned in specific industries to broaden this classification. For instance, researchers have suggested “a broader definition of waste to include not only material waste, but also waste generated in a construction project such as waiting times, transportation times…” (Hosseini et al., 2012, p. 415). The lean approach for the elimination of waste, as described by Ohno (1988), is as follows: “All we are doing is looking at the time line, from the moment the customer gives us an order to the point when we collect cash. And we are reducing that time line by removing the non-value-added wastes” (p. 9). The lean approach towards construction adopts both physical and non-physical waste production. On the basis of the existing literature, waste in the context of construction can be classified into eight types, namely defects, overproduction, waiting, not-utilizing talent, transportation, inventory excess, motion waste, and excess processing.

Overproduction is understood as producing unnecessary products that are independent of the demands (Jasti & Kodali, 2014). It also refers to the production of goods before they are required. Both of these activities enhance the possibility of producing inaccurate goods, product obsolescence as well as the need to offer products at a discount (Ohno, 1988). Overproduction is defined as production that exceeds demands from the customers. Overproduction has been categorized into two types: early and quantitative (Shingo, 1989). Early overproduction refers to the creation of products prior to their need. Quantitative overproduction refers to the creation of more products than required. Researchers have noted overproduction as the most important waste source in construction. In addition to the financial waste associated with inventory and additional inventory, overproduction also causes shortage due to the utilization of processes to create products that are not needed.

Previously, managers were judged on the basis of the production quantity based on the belief that higher production reflected highest utilization of resources. However, such approach led to the problem of waste due to overproduction (Gupta & Jain, 2013). The introduction of the lean philosophy presented the belief that only in the presence of productive and specified goals should the human resource and the machine resource be utilized (Askin and Goldberg 2002). The highlight of lean production philosophy is on the needs of the customers, which should drive the production, in order to avoid storing products and cause their waste.

Researchers have noted that when production is directed by predictions rather than orders derived from the customers, overproduction is likely the outcome. Due to customers’ need to received product earlier than it is possible to produce the product, it is not possible to completely avoid using predictions (Bhamu & Sangwan, 2014). Researchers have suggested moving the orders upstream in the process of production. As such, there has been a particular emphasis on production based on the orders from customers.

Studies suggest that overproduction causes higher costs to plans responsible for manufacturing as it decreases productivity and quality and hinders consistent material flow. Due to this, it may lead to deterioration of the products, or the inability to identify defects at the right time (Forsberg & Saukkoriipi, 2007). Overproduction requires additional equipment, batch processing, extra human resource, additional storage, inconsistency in the material flow, bigger lot size, and extra storage space on the floor. Overproduction may result from inaccurate or incomplete information on services or products.

The lean principle includes the component of respect for individuals. Overproduction, which results from production of goods that are not needed by the customer, diminishes this characteristic (Gupta & Jain, 2013). The traditional approach of viewing higher production as the maximization of resources leads to a higher emphasis on machines compared to humans. As such, overproduction not only leads to the waste of material resources, but also of human resource.

The lean principle is to produce on the basis of orders from the customers. Researchers use the term just in time to characterize the approach undertaken in lean manufacturing, as opposed to the just in case approach that characterizes overproduction manufacturing. Production that is independent of orders from customers is associated with inhibition of human and material resources that could otherwise be directed towards satisfying demands from customers. Due to it causing other types of waste as a side effect, including excessive transportation costs, storage costs, and overstaffing costs, overproduction is considered to be the most significant form of waste.

Author: Henri Suissa


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