February 2009, Volume 1, Issue 2

Identifying Non-Value Added Time

Eighty percent and more of business and production process time is non-value added. Although this is anecdotal, it is based on close to 20 years of mapping these processes in an effort to reduce cost and cycle time. One of the many tools in the Lean tool chest is Value Stream Mapping. However, I've used a lesser known tool since 1990 to identify wasted time in any type of process. This tool is called A-Delta-T: A being the actual cycle time, T being the theoretical best cycle time, and Delta being the difference between the two, or waste. I'll get into the mechanics of using A-Delta-T in a future issue, but for now I want to concentrate on what I consider non-value-added time in a process. For those wanting more information right now, Google 'A Delta T' or go right to this description of the process.

For this issue, I would like to concentrate on non-value added time. The beauty of using time in any improvement effort is that time is

1. Easy to measure
2. Easy to understand by all members of the process improvement team
3. Easy to translate to money.

Focus on the time in your business and you hold the key to a competitive advantage!
How can non-value added time represent 80%+ of a business or production process? Most of that time is queue time, or waiting time in between steps. But other time might surprise you.
Consider this exchange I had while facilitating a team working reduce the cycle time of producing saddle-stitched catalogs. After we had mapped out the process from receiving the digital files through shipping we set about trying to identify all of the non-value added steps. Waiting for proof approval? Sure, non-value added. Waiting for stock to be delivered to press? Yes, non-value added. Setting up the press? No way. The customer pays us for this. I challenged the room on this one.

"So, the customer is willing to pay us for this?"

"They always have."

"The communications company down the street runs this exact type of job one after the other. They don't have to set up for it. They don't have to charge the customer for it if they don't chose to. Are we really adding value to the finished product?"

"Well, if we didn't set up for the job, the customer would not like what they get."

"Understood. However, a non-value added task does not necessarily mean that it doesn't have to be done in your current environment. It just means that it adds no value."

There are so many of these types of steps in a process. In looking at the hours it took a printer to create an estimate the team discussed the step of routing the estimate to the President for final approval of pricing. Although necessary in the current process, it did not add value and was marked as such.

Give this some thought as you look to streamline your own processes. It will come in handy when using A-Delta-T!