OpAudCh07-CBET-01-501E-Toralde, Ma - Kristine E.

TORALDE, MA.KRISTINE E.
CBET-01-501E
1. How can overproduction be minimized?
Overproduction is the manufacturing of products that are more than they should
be. To reduce overproduction if not eliminated, we have what is called just-in-time
production where we only manufacture products when there are orders, so this is an
idea to prevent overproduction. Also accurate forecasting helps organization in decision
making when manufacturing products. Organizations perform cycle counts and physical
counts, build/rent and use climate-controlled facilities, implement access controls, and
in general build an infrastructure to address overproduction
2. Describe three reasons why waiting is damaging to organizations?
First, waiting is damaging to organization because it reduces customer

satisfaction, because there is a lot of competition between businesses, organizations
should always improve the processing of products to speed up and satisfy more
customers.
Second, if the customers of the business or organization need to wait a long time
to buy the necessary goods. Consumers of your product will be forced to simply buy the
product in other businesses of the same type.
Third, waiting also indicates that there is no clear communication between
members of an organization or the process planning of the organization is not clear. It
does not add value to the quality of goods or services provided by an organization.
However, not all waiting time is a waste in an organization because sometimes
that waiting time is required in the process of a product.
3. How is transporting a waste? Provide an example to support your answer.
Transporting is considered a waste when it is unnecessary, because if you take

from one place to another unnecessarily, you are just wasting time and you will only
spend additional cost for fuel. Example of transporting waste. Example of when
transporting is unnecessary is, the return of inventory to storage when there are too
many issued. The movement of products or parts from one place to another.
4. How can organizations avoid, or at least minimize, unnecessary paperwork and

processing?
An organization can minimize unnecessary paperwork and processing through

converting some paper works into digital form, due to the large number of users today
using technology to facilitate and expedite tasks. Converting documents into digital
form and also helps to make the papers with information about the organization more
secure. And to save the information it will not be lost immediately unlike papers when it
loses more work for the organization because they may not have another copy then.
The traditional way because paper-based filing systems are more risky and more
expensive because there are many things to buy like binder, papers, ink, folders, shelves
for filing documents and etc. So in paperless office the organization is cheaper because
there is not much need for supplies.
5. If inventory is an asset, why is it considered a waste?
Inventory is considered waste when it is unnecessary, like for example because

there is overproduction the organization has an additional cost for the inventory of
these excess products and when the raw materials are not immediately converted into
finished products the storage cost of an organization. So because of those cases there is
waste in inventory, to say that an organization is efficient their inventory of raw
materials should be immediately converted into goods that can be sold in the market for
profit.
6. Explain how you can identify excess motion during an operational audit.
The excess motion during an operational audit is identified by reviewing the

workspace layout when the workspace is disorganized the parts, machines and
equipment are also not organized. So because of this poor work environment there is an
excess motion called and only adds to the cost incurred by the business. Excess motion
is also due to the physical ailments of the employees, so when employees feel this way
they should first rest or reduce their time at work and take medications.
7. Describe the impact of defects on organizational success from an internal and external
(e.g., competitive) perspective.
In today's business environment competition is becoming hard. It is not easy to

compete with other businesses so entrepreneurs should always have room for
improvement and gimmicks. In the release of products in the market must always be
high quality and almost perfect, because there is a lot of business in all kinds of industry
people have many choices and of course the majority will choose the ones with good
quality and low price. So defective products greatly affect the satisfactory of the
customers. Like for example I ordered products online and it reached me with defects,
the result I will not order from them again and next time I will just buy from others.
Defects affect internally an organization because it means something is wrong with the
process of their product because that defective product still reaches the customers, and
of course they still need to rework on the defective product and that incurred additional
cost for the organization. Its external impact is that the image of the organization is
destroyed to the public because their defective products reach the customer so the
competitiveness of the organization will be reduced due to what happened.
8. Provide three recommendations to minimize the presence of underutilized employees.
First recommendation, is that they should be given a job where they are good
and the purpose for which the organization hired them in the first place. So that they
can use their talent and potential in that job, and of course they will work even harder
because they know what they are doing and they do not predict what to do.
Second recommendation, the business owner or the management should know
how well or poorly the employees are performing, so that if according to the analysis
the performance of the employees is poor the management will be able to identify how
to work with disabilities this, to provide training, programs or plans for employees.
Third recommendation, provide opportunities for employees to be flexible at
work, in that case employees are available because they can do more than they know
how to do. Give them time to also improve on the new job that will be given to them
because it is obvious that it is not their forte.
9. How can the Eight Areas of Waste be used to build an operational audit work program?
Eight waste areas can be used to develop a job management program through
waste identification and inefficiency. To know the probability of occurrence of these
problems areas it is more helpful for internal auditors to create a program that can
operate organization more efficiently and to achieve the organizational objectives. Eight
areas of Waste provides a simple but very effective way to identify potential risk
problems in an organization's program
10. Show how a process can have more than one of the Eight Areas of Waste present
simultaneously.
A process can have more than one of the Eight Areas of waste present
simultaneously when there are excess products because there will be overproduction
and at the same time there will also be unnecessary inventory that needs to be
transported to storage again. These incurred additional cost for the organization
because it is all unnecessary.
References
1. Hernan, M. Operational Auditing: Principles and Techniques for a Changing World.
Chapter 5 Control Frameworks. P. 190. New York. CRC Press.
 Retrieved from https://www.unleashedsoftware.com/blog/5-causes-inventory-
waste-
avoid#:~:text=Avoid%20overproduction%20by%20making%20things,needed%2C
%20when%20it%20is%20needed

Chapter 5 Control Frameworks. P. 192-193. New York. CRC Press.

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TORALDE, MA.KRISTINE E.

1. How can overproduction be minimized?

2. Describe three reasons why waiting is damaging to organizations?

First, waiting is damaging to organization because it reduces customer

3. How is transporting a waste? Provide an example to support your answer.

Transporting is considered a waste when it is unnecessary, because if you take

4. How can organizations avoid, or at least minimize, unnecessary paperwork and

An organization can minimize unnecessary paperwork and processing through

5. If inventory is an asset, why is it considered a waste?

Inventory is considered waste when it is unnecessary, like for example because

The excess motion during an operational audit is identified by reviewing the

In today's business environment competition is becoming hard. It is not easy to

8. Provide three recommendations to minimize the presence of underutilized employees.

2. Hernan, M. Operational Auditing: Principles and Techniques for a Changing World.

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