Waste can account for up to 30 per cent of the operating costs of a business.
Unfortunately, waste is often simply accepted as the operating norm, with most businesses putting their energy into increasing sales rather than looking for waste-reduction opportunities.
Step 1 – audit: complete a waste audit on your business to identify the wide range of waste issues within the organisation that, when addressed, will improve profitability. Go through your expenses line-by-line.
Step 2 – prioritise: with so many issues requiring attention, the project of driving out waste can be overwhelming. Setting the priority enables the most important issues to be dealt with first.
Step 3 – teams: creating teams to drive the waste-reduction process (and remove the wastes) doesn’t just happen – it needs to be managed.
Step 4 – KPIs: you need to establish key performance indicators (KPIs) before you start driving out waste.
Step 5 – repeat: when most of the waste has been addressed, this step then involves going back to step 1 and repeat the process annually.
Katrina Brennan, Director, SRJ Walker Wayland Business Growth Advisors, Accountants and Auditors. Level 2/2 Innovation Pkwy, Birtinya, 5301 9957, srjww.com.au.
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