The Eighth Type of Waste

Unused human potential is often referred to as the eighth type of waste in Lean Management. And rightly so, because it is the creativity of "ordinary" workers that enables the continuous improvement and elimination of the classical seven types of waste.

The sev­en clas­si­cal types of waste in Lean Man­age­ment are now often sup­ple­ment­ed by an eighth type: the unused poten­tial or unused cre­ativ­i­ty of employ­ees. Mak­ing use of this human poten­tial for the pur­pose of con­tin­u­ous improve­ment is indeed a fun­da­men­tal prin­ci­ple of Lean Man­age­ment. This eighth type of waste is there­fore under­ly­ing the oth­ers and is hence clear­ly of dif­fer­ent nature. Despite this, and because of this, it is a valu­able addi­tion to the sev­en orig­i­nal types of waste.

The rise of Toy­ota after the Sec­ond World War is inex­tri­ca­bly linked with the name Tai­ichi Ohno. He sig­nif­i­cant­ly influ­enced and fur­ther devel­oped the Toy­ota Pro­duc­tion Sys­tem. What is today known as Lean Man­u­fac­tur­ing and more gen­er­al­ly as Lean Man­age­ment orig­i­nates large­ly from his sem­i­nal work. As a result, Toy­ota suc­ceed­ed in sig­nif­i­cant­ly increas­ing pro­duc­tiv­i­ty and not only catch­ing up with the Amer­i­can com­pe­ti­tion from Detroit, but out­per­form­ing it.

Seven Types of Waste in Lean

A cen­tral ele­ment of the Toy­ota Pro­duc­tion Sys­tem (TPS) is the elim­i­na­tion of all waste. This means the avoid­ance of any activ­i­ty that absorbs resources but cre­ates no val­ue, which bet­ter reflects the Japan­ese term Muda (無駄) than the usu­al trans­la­tion in Eng­lish lit­er­a­ture with waste. Tai­ichi Ohno orig­i­nal­ly dis­tin­guish­es these sev­en types of waste (the first let­ters result in the acronym TIMWOOD as a mnemonic):

The Seven Types of Waste in Lean Management

In many fac­to­ries, for exam­ple, over­pro­duc­tion of semi-fin­ished and fin­ished prod­ucts was and is com­mon. These buffers can com­pen­sate to a cer­tain extent for qual­i­ty fluc­tu­a­tions dur­ing pro­duc­tion (and in the sup­ply chain) and thus pre­vent effects on qual­i­ty and deliv­ery dates.

The most dan­ger­ous kind of waste is the waste we do not recognize.

Shi­geo Shingo

It is because these buffers are so con­ve­nient and seem­ing­ly indis­pens­able that this type of waste is often not rec­og­nized as such. Nev­er­the­less, the hid­den costs of inven­to­ry, stor­age space and trans­port should not be under­es­ti­mat­ed. Many authors there­fore regard over­pro­duc­tion as the worst type of waste.

These sev­en types of waste are all relat­ed to process­es. They describe symp­toms of weak­ness­es in work pro­ce­dures whose root caus­es must be found and elim­i­nat­ed. This con­tin­u­ous improve­ment (Kaizen) of process­es is there­fore an essen­tial ele­ment of the Toy­ota Pro­duc­tion Sys­tem. Con­trary to the pre­vail­ing view at the time, how­ev­er, con­tin­u­ous improve­ment in lean man­age­ment is not reserved for man­age­ment, but is the task of “ordi­nary” work­ers. A dif­fer­ence that makes a difference.

The Toy­ota style is not to cre­ate results by work­ing hard. It is a sys­tem that says there is no lim­it to people’s cre­ativ­i­ty. Peo­ple don’t go to Toy­ota to ‘work’ they go there to ‘think’.

Tai­ichi Ohno

Unused Human Potential

At the heart of Tai­ichi Ohno’s phi­los­o­phy is the human being as an essen­tial suc­cess fac­tor. The pri­ma­ry man­age­ment task is there­fore empow­er­ing instead of instruct­ing. In his book “The Toy­ota Mind­set, The Ten Com­mand­ments of Tai­ichi Ohno” (Ama­zon Affil­i­ate-Link) Yoshi­hi­to Waka­mat­su, who worked many years direct­ly under Tai­ichi Ohno, reports the fol­low­ing anec­dote illus­trat­ing this prin­ci­ple. Dur­ing a vis­it to a Toy­ota plant, Ohno was accom­pa­nied by anoth­er man­ag­er. This man­ag­er noticed some mis­ap­pli­ca­tion of the Toy­ota pro­duc­tion sys­tem and asked Ohno why he had not cor­rect­ed them imme­di­ate­ly. The answer was:

I am being patient. I can­not use my author­i­ty to force them to do what I want them to do. It would not lead to good qual­i­ty prod­ucts. What we must do is to per­sis­tent­ly seek under­stand­ing from the shop floor work­ers by per­suad­ing them of the true virtues of the Toy­ota Sys­tem. After all, man­u­fac­tur­ing is essen­tial­ly a human devel­op­ment that depends heav­i­ly on how we teach our workers.

Tai­ichi Ohno

In order to elim­i­nate the sev­en types of waste, the cre­ativ­i­ty of all the peo­ple involved in these process­es is need­ed. Empow­er­ing and train­ing these for­mer­ly “sim­ple” work­ers to do this is the cen­tral task of lead­er­ship. In essence, Tai­ichi Ohno was about unleash­ing human poten­tial over employ­ing human resources, as it is now described in the Man­i­festo for Human(e) Lead­er­ship.

The first thesis of the Manifesto for Human(e) Leadership matching the eighth type of waste in Lean Management
The first the­sis of the Man­i­festo for Human(e) Leadership

In order to empha­size this, unused human poten­tial or unused cre­ativ­i­ty is con­sid­ered the eighth type of waste. Right­ly so, on the one hand, because the untapped poten­tial of employ­ees is huge, as orga­ni­za­tions are still oper­at­ed like machines and peo­ple are treat­ed like lit­tle cog­wheels.

On the oth­er hand, this eighth kind of waste is obvi­ous­ly of dif­fer­ent nature than the clas­si­cal sev­en, because it under­lies them in some way. How­ev­er, the use of cre­ative poten­tial is so cru­cial in Lean Man­age­ment that it makes sense to com­ple­ment the sev­en clas­sic types of waste with this eighth. Besides Toy­ota, the exam­ple of the Upstals­boom clear­ly shows that it is worth­while for every­one when human resources final­ly become human potential.

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