One of the key tools in Lean Farming is identifying waste. There are eight forms of waste that can be remembered via this acronym:
D – defects
O – overproduction
W – waiting
N – non-utilised people, intellect and resources
T – transport
I – inventory
M – motion
E – extra processing
In this article we look at the waste known as Inventory. This is hard to identify on farms. It is when you have an excess of something that you do not actually need which then takes up space or ties up working capital. This should not be confused with carrying an extra something in case of a problem, e.g. extra silage in case of a drought. It is when you have more than you need to get the job done.
It is normally the result of producing too much or ordering too much which then takes up space. It can also lead to products, e.g. medicine or feed going out of date and being wasted. An example of this would be a farm that ordered extra dry cow rolls, as the price was low, for the following year. The problem being that the minerals for the rolls went out of date after six months and the product wasn’t going to be used for nearly 12 months. The product was wasted and the saving in cash terms lost.
Other examples of this waste on farm:
• Too much medication ordered that expires and no longer fit for purpose.
• Ordering too many bags of seed which don’t get used and then lose their viability to germination potential in the following year.
• Too much straw purchased which then gets stored outside and wet from the rain.
• Not knowing what stocks you have in the workshop of wire, nails, staples, bolts, etc. and ordering more.
To help avoid this, one of the Lean tools is known as Kanban cards. It is a system to manage purchases to avoid stock piling or over purchasing. This is a system that places a coloured card by the particular item of stock with details of when to order more so as to avoid carrying too much stock, see example below.
This card would be placed in the pile of glove boxes at the point when there is only sufficient stock left to last 14 days, the time taken for the new order to arrive. When the card is revealed the team member knows it is time to reorder and can use the information on the card to do so, thus avoiding over ordering or running out.
Make reducing waste in your business one of your New Year resolutions in 2020. If you would like to discuss this further or other areas of Lean Management, please contact Phil at email@example.com