Waste of time and materials can be minimized by identifying areas where duplication of efforts is taking place. Duplication of efforts can be understood from this example: where the task can be accomplished by one employee, the business is employing two.Elimination of duplication of efforts results in lower wastage and higher cost savings.
Many industries like the fast food industry suffer from huge inefficiencies because of duplication of efforts. Many are of the view that automation eliminates duplication of efforts and therefore reduces wastage and saves costs. Robots can be used for assembling a burger, which you eat at the McDonald’s, more efficiently.But then critics say that using these robots will result in job losses for human beings. Fast food industry is after all one of the major employers. However automation by using robots in making burgers will result in higher efficiencies and lower costs.
These lower costs will be transferred to customers in the form of lower prices. Lower prices of fast food will increase their demand. To meet the increased demand a fast food chain will have to hire more people to serve customers or to make home delivery. So the job losses caused by using robots for assembling burgers may be more than offset by the employment generated due to increased demand of burgers and other fast food items.
The point is that inefficiencies can be eliminated by automating certain processes and activities. When inefficiencies are eliminated a business is able to offer its products and services at lower prices to customers. This results in higher market share, higher revenues, and higher profitability. When the business becomes more profitable, it is able to pay its employees higher wages. The large inefficiencies in the fast food industry are often blamed for the poor wages that the industry offers to its employees.
A business has the responsibility to maximize the value created for its stakeholders. Shareholders, employees and customers are three of the most important stakeholders of any business. By adopting a zero-tolerance approach to inefficiencies the business can create more value for all these three stakeholders.The fast food industry is not alone in suffering from inefficiencies caused by wastage of time, energy and materials. There are many industries out there that suffer from in-built inefficiencies caused by wastage. The outcome is high cost structure, high prices and lower value for customers, employees and shareholders.