Waste-Added Tax (WAT) – how much are you paying?

Waste-Added Tax

Waste-Added Tax

Every activity that doesn’t add Value for the Customer costs you money. Money that increases cost, reduces margin and makes you vulnerable to leaner competitors.

It’s the tax that you pay for inertia and inefficiency. And it’s the tax that keeps on taking. Every day that you aren’t implementing Lean. Every day that you lose focus on improvement. Every day that you keep on doing what you’ve always done.

With labour and materials costs continuing to rise, and customers wanting price reductions, it’s the tax that you must avoid. In fact, reducing Waste-Added Tax should be part of everyone’s daily activities.

Here’s a suggestion: show WAT as a line in your Management Accounts. Measure it, publish it, hold people accountable, set targets and apply your problem-solving process to reducing it.


Better, Cheaper, Faster – myth or fact?

I regularly meet people in manufacturing who still see life as full of trade-offs and compromises. “There’s no such thing as perfect”. “If it goes any faster, it’ll break down”. “We can get better material but they won’t pay for it!”. “if we turn up the speed, we’ll get more rejects”.  “If you pay peanuts, you get monkeys”. “We make the best, so we have to charge top dollar for it”. “We might be able to do it faster, but it’ll cost you!”.

Any of these phrases sound familiar? I’ve spent my whole working life listening to them. And I don’t believe any of them. Let me tell you why…

From the day we’re born, our reptile brains are hard-wired to learn about cause and effect. “Cry – get fed”. “Touch the stove – get burned”. As human beings, we’re very good at seeing these links. So good in fact that we can see links that don’t exist! And soon, many of these false links come to be accepted as true.

“You only use 10% of your brain”, “Alcohol helps you sleep” “Humans lose most of their body heat throgh their heads”. Common knowledge? Common myths, in fact.

And the moral of the story? If you’re serious about making step changes in your manufacturing performance, start with your own myth-busting. Challenge preconceptions, focus on the facts and run some experiments. Change the dialogue – “Where’s the data?”, “What’s the evidence?”, “Show me the facts”, “Humour me – let’s try it.” Many’s the time I’ve seen a machine run faster with absolutely no decrease in quality at all.

So what’s your own experience – and which myths have you helped to bust?

QCD - Quality, Cost and Delivery