1. What is DOWNTIME? Scott Thor © Variance Reduction International, Inc. (VRI), All Rights Reserved

2. Determining Value Value-added (VA) Customer is willing to pay Meets expectations Something changes that enhances value to customer Business non-value-added (BNVA) Required to function (i.e. billing, tax prep, purchasing, sales) Non-value-added (NVA) Rework, defects, handling, transportation of materials 2

3. Lean Process Analysis 3

4. What is waste? Defects Overproduction Waiting Not using people well Transportation Inventory Motion in excess Excess processing Muda 4

5. Defects Failing to meet expectations Requires rework to fix Negative impacts Productivity Costs Safety 5

6. Overproduction Creating more product or delivering a service before it is needed Negative impacts Productivity Available space Quality 6

7. Waiting Keeping customers and employees waiting for: Materials Information Services Negative impacts: Lost productivity Meeting customer expectations 7

8. Not Using People Well Underutilizing the talent of people Misalignment of individual and company goals Negative impacts: Employee engagement Company performance 8

9. Transportation Unnecessary movement of equipment, data, people, etc. Negative impacts: Increased costs Damage to product or data 9

10. Inventory Excessive work in process and / or finished goods Negative impacts: Cash flow Storage costs 10

11. Motion in Excess Movement by employees that adds no value Negative impacts: Safety Efficiency losses 11

12. Excess Processing Going beyond what the customer expects Negative impacts: Increased costs Decreased profitability Delivery delays 12

13. Other Types of Potential Waste Inspection Over communication Engineering changes Meetings Excessive data Resistance to change 13