Conquer Chaos: Eliminating Costly Waste in Your Business
For too long, the trade and construction industry has bled profits and productivity through unseen waste; and it is not just materials and labour! It is time to stop the bleeding, reclaim your margins, and build a legacy of true efficiency. This is not about saving or making a few extra bucks; it is about forging a business that builds credibility, a team that thrives, and a sustainable future that is built on solid ground.
The numbers show:
- Þ Most projects are running 20% longer
- Þ Budgets are blowing out by up to 80%
- Þ Over 35% of technician time wasted on non-productive tasks
This is not the cost of doing business; it is the cost of poor business. Let us give you some insights to equip you with the strategies to identify, measure, and drastically reduce these silent killers.
Unmasking the Seven Wastes: Your Path to Profit
The Seven Wastes are the insidious drains on your resources. Let us expose them with real-world examples from our industry, arm you with Key Performance Indicators (KPIs) to track their impact, and deliver powerful fixes to turn the tide.
1. Transportation: The Unnecessary Journey
The Waste: Excessive movement of materials, tools, or equipment between locations. Think of the time and fuel wasted shuttling items back and forth.
Example: A plumber drives back to the workshop because a specific fitting was not loaded onto the van, or materials delivered to the wrong section of a large construction site, requiring extra handling.
KPIs:
•Travel Time/Distance per Job: Measure the average time or distance spent on material/tool retrieval.
•Material Handling Costs: Track expenses related to moving materials on-site.
Fixes: Standardised van kitting, pre-ordering site deliveries, and strategic site layout planning to minimise movement.
2. Inventory: The Hidden Cost of Holding
The Waste: Holding more materials, tools, or work-in-progress than immediately needed. This ties up capital, requires storage, and risks damage or obsolescence.
Example: A builder orders a bulk quantity of a specific tile for a project, but delays mean the tiles sit on-site for weeks, exposed to weather, or a contractor keeps an excessive stock of common parts in their workshop, leading to capital lock-up.
KPIs:
•Inventory Turnover Rate: How quickly stock is used and replaced.
•Storage Costs: Direct costs associated with warehousing and managing inventory.
•Dead Stock Value: Value of unused or obsolete materials.
Fixes: Implement min-max inventory levels, weekly top-up systems, and a proactive dead-stock burn-down plan. Use barcode/QR stock checks for accuracy.
3. Motion: The Wasted Movement of People
The Waste: Any unnecessary movement by people that does not add value to the task. This includes searching, reaching, bending, or walking.
Example: A carpenter spends 15 minutes searching for a specific power tool in a disorganised toolbox or a technician repeatedly walks across a large site to retrieve different components for a single installation.
KPIs:
•Tool/Material Retrieval Time: Average time spent locating necessary items.
•Non-Value-Added Movement Time: Time spent on physical movements not directly contributing to the task.
Fixes: Standardised job packs, ergonomic workstation design, and 5S methodology (Sort, Set in Order, Shine, Standardise, Sustain) for tool and material organisation.
4. Waiting: The Stalled Progress
The Waste: Any idle time experienced by workers, equipment, or materials due to delays in the process. This is often a ripple effect of other wastes.
Example: A crew waits for materials to arrive, for a previous trade to finish their work, for equipment to be repaired, or for client approval on a variation. This directly impacts project timelines and labour costs.
KPIs:
•Waiting Time per Task/Project: Total hours lost due to delays.
•Project Schedule Adherence: Percentage of tasks completed on time.
•Equipment Downtime: Time equipment is non-operational due to maintenance or waiting for parts.
Fixes: Implement SMS reminders and live ETAs for deliveries, pre-order delivery to site, A/B supplier rules for backup, and clear communication protocols for approvals. Optimise scheduling and workflow to minimise handoffs.
5. Overproduction: The Cost of Doing Too Much, Too Soon
The Waste: Producing more than is needed or producing it sooner than required. This often leads to excess inventory, storage issues, and potential rework.
Example: A fabrication shop produces a batch of custom components before the site is ready for installation, leading to storage issues and potential damage, or a design team creates overly detailed plans for an early-stage concept that will likely change.
KPIs:
•Work-in-Progress (WIP) Levels: Amount of unfinished work in the system.
•Excess Material/Component Production: Quantity of items produced but not immediately used.
Fixes: Implement tiered quoting (ballpark vs. full detailed quotes), use templates for common jobs, and adopt a pull system where work is initiated only when demanded by the next stage.
6. Over-processing: The Unnecessary Effort
The Waste: Performing more work on a product or service than is required by the customer. This adds no value and consumes resources.
Example: A project manager requires multiple redundant signoffs for minor changes, or a team spends excessive time polishing a component that will be hidden from view, or manual data entry into multiple systems when one digital entry would suffice.
KPIs:
•Process Cycle Efficiency: Ratio of value-added time to total lead time.
•Rework Rate (due to unnecessary complexity): Percentage of tasks requiring re-doing due to over-processing.
Fixes: Streamline approval processes, digital forms for single data entry that auto-sync to invoices and timesheets and focus on customer value to eliminate non-essential steps.
7. Defects: The Cost of Getting It Wrong
The Waste: Any error, mistake, or rework that requires additional time, resources, and effort to correct. This is perhaps the most obvious and costly waste.
Example: Incorrect measurements leading to material waste and re-cutting, faulty installations requiring call-backs, or poor communication resulting in a finished product that does not meet client specifications.
KPIs:
•Rework Rate: Percentage of work that needs to be redone.
•Warranty Claims/Call-backs: Number or cost of post-completion issues.
•First-Time-Right (FTR) Rate: Percentage of tasks completed correctly on the first attempt.
Fixes: Implement digital QA checklists, photo sign-off for completed stages, robust training programs, and a culture of 'first-time-right' quality. Use technology for precise measurements and clear communication.
Are You Ready to Transform Your Business?
The trade and construction industry is ripe for a revolution in efficiency. By systematically identifying and eliminating these seven wastes, you are not just cutting costs; you are building a more resilient, profitable, and respected business. It is about empowering your team, delighting your clients, and securing your legacy.
To find out more about our ‘hands on’ Operational Process Improvement advice, contact one of the team at PROTRADE United.
Written by Jon Mailer
CEO of PROTRADE United
Author of ‘Not Just a Tradie’
