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Topic 3: Thinking of Material Management as Waste

We are reviewing the biggest changes in Material Management that have taken place since the 1990’s, and the attitude that Material Management or material handling is a form of “muda” was a big one back then.

In the 1990’s (at least as I remember them) one of the perceived biggest opportunities to improve a process was to reduce the amount of handling or material touches, with the view that all material handling was waste and by doing so you would be more “efficient”. Here are some of the things that were done in the name of Lean efficiency:

  1. Store as much material as possible at the Points of Use, in order to reduce kitting and handling.
  2. Push part selection work onto the line operators, and take it away from the “indirects”.
  3. Store large quantities of material on the factory floor, and by-pass the warehouse altogether, to reduce touches.
  4. Treat “kitting” as a dirty word, and avoid it at all costs.
  5. Infrequent delivery route schedules, like once a day or once a shift deliveries.
  6. Put pallet-load quantities at the Points of Use, to avoid having to restock any time soon.

The philosophy behind these strategies was that since material handling does not change the form, fit or function of the product, it is pure waste and any actions to reduce the amount of material handling required was a good thing. Not included in this calculation were the impacts on operator productivity, factory prime real estate needed, quality risks when operators have to make too many choices.

Compare and contrast this to what I saw at Toyota Motors at their huge Georgetown plant that makes the Camry: almost total elimination of Point of Use material, other than a kit for the unit being worked on. We’ll be discussing kitting in a future topic, but trust me in saying that this was a big change from past years. Kanban was still in use in Supermarkets and kitting cells, but substantial efforts were being made to deliver kits of parts, one-by-one, to the various feeder cells. Why? Because the total benefit, when you include operators, were greater than the cost of the additional handling. Measuring the total system cost and not just a single department is the important point often lost when discussing material handling.

To further emphasize that material handlers are not second-class citizens, Toyota Material Handling does not use the “direct” versus “indirect” classifications. Everyone is direct.