Application
This unit of competency covers the skills and knowledge required by an individual to be able to identify the major cost components of either products or processes, the basic relationship of these to customer benefit, and use this to help minimise waste (defined as anything not delivering value as defined by the customer). It has a different focus to MSS402030 Apply cost factors to work practices, which focuses on costs in isolation, whereas this unit regards all costs not directly leading to customer benefit as waste.
This unit applies to an individual who uses their understanding of the customer's requirements of the product or process being undertaken as the basis for investigating work processes to identify waste sources and then takes action relevant to their level of competency and authority to reduce this waste. It requires an understanding of both the cost factors in the products they make and also the benefits which the customer derives from the product.
This competency may be performed individually or in a team-based environment.
This unit requires the application of skills associated with analysis and problem solving to identify waste and determine ways to minimise waste. This unit requires initiative and enterprise and application of learning in concepts of waste and waste minimisation.
No licensing, legislative or certification requirements apply to this unit at the time of publication.
Elements and Performance Criteria
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. | ||
1 | Identify cost components deriving from customer benefit and other costs | 1.1 | Identify customer features/benefits in product or process being undertaken. |
1.2 | Identify cost components which deliver customer features/benefits and those which do not. | ||
2 | Compare required performance of product or process steps with actual performance | 2.1 | Identify performance required to meet customer needs in own work and that of team. |
2.2 | Identify actual performance. | ||
2.3 | Compare cost components of products or process with current customer-related targets. | ||
2.4 | Separate costs components into those that contribute to customer features/benefits and those that do not. | ||
2.5 | Determine non-contributing cost components which are under control of the individual or team. | ||
3 | Minimise waste | 3.1 | Recommend changes to eliminate or reduce waste. |
3.2 | Adopt changes which minimises waste. | ||
3.3 | Monitor effect of changes to ensure gains are made against customer features/benefits. | ||
Evidence of Performance
Evidence required to demonstrate competence in this unit must be relevant to and satisfy the requirements of the elements and performance criteria and include the ability, on one (1) or more occasions to recommend muda reduction related to their workplace, and to:
identify and distinguish between cost components leading to customer benefit or otherwise
take steps to minimise muda in their workplace.
Evidence of Knowledge
Must provide evidence that demonstrates knowledge relevant to their job role sufficient to fulfil their job role under routine only supervision, including:
contributions towards customer perceived benefit
concepts of expense, income and capital
fixed and variable cost components relevant to own work:
power/energy
materials, plant and equipment
production or process time, including impact of salary and wages
office expenses
government taxes and charges
relative impact of each of these
financial and non-financial impacts of cost reductions
the difference between internally and externally controlled costs
difference between overhead, labour and consumables.
Assessment Conditions
The unit should be assessed holistically and the judgement of competence shall be based on a holistic assessment of the evidence.
The collection of performance evidence is best done from a report and/or folio of evidence drawn from:
a single project which provides sufficient evidence of the requirements of all the elements and performance criteria
multiple smaller projects which together provide sufficient evidence of the requirements of all the elements and performance criteria.
A third-party report, or similar, may be needed to testify to the work done by the individual, particularly when the project has been done as part of a project team.
Assessment should use a real project in an operational workplace.
Knowledge evidence may be collected concurrently with performance evidence or through an independent process such as workbooks, written assessments or interviews (provided a record is kept).
Assessment processes and techniques must be appropriate to the language, literacy and numeracy requirements of the work being performed and the needs of the candidate.
Conditions for assessment must include access to all tools, equipment, materials and documentation required, including relevant workplace procedures, product and manufacturing specifications associated with this unit.
Foundation skills are integral to competent performance of the unit and should not be assessed separately.
Assessors must satisfy the assessor competency requirements that are in place at the time of the assessment as set by the VET regulator.
The assessor must demonstrate both technical competency and currency.
Technical competence can be demonstrated through:
relevant VET or other qualification/Statement of Attainment AND/OR
relevant workplace experience
Currency can be demonstrated through:
performing the competency being assessed as part of current employment OR
having consulted with an organisation providing relevant environmental monitoring, management or technology services about performing the competency being assessed within the last twelve months.
Foundation Skills
This section describes those required skills (language, literacy and numeracy) that are essential to performance.
Foundation skills essential to performance are explicit in the performance criteria of this unit of competency.
Range Statement
This field allows for different work environments and conditions that may affect performance. Essential operating conditions that may be present (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) are included. | |
Competitive systems and practices include one or more of: | lean operations agile operations preventative and predictive maintenance approaches statistical process control systems, including six sigma and three sigma Just In Time (JIT), kanban and other pull-related operations control systems supply, value, and demand chain monitoring and analysis 5S continuous improvement (kaizen) breakthrough improvement (kaizen blitz) cause/effect diagrams overall equipment effectiveness (OEE) takt time process mapping problem solving run charts standard procedures current reality tree. |
Customer features/ benefits include all of: | characteristics of the product or service which the customer perceives as meeting their need characteristics of the product or service which the customer perceives as adding value financial or features items which the customer perceives and a benefit. |
Performance includes all of: | takt - the allowable time to produce one product at the rate and quality customers are demanding it the rate of output of the plant compared to the takt time. |
Customer-related targets includes all of: | internally set financial targets that contribute to meeting customer features/benefits operational targets that contribute to meeting customer features/benefits other targets that contribute to meeting customer features/benefits. |
Contributing cost components include all of: | costs that make a direct contribution to customer features/benefits. costs that need to be incurred (although they may be minimised) in order to gain the customer feature/benefit. |
Non-contributing cost components include all of: | costs that do not contribute to customer features/benefits costs that must be maintained, such as regulatory compliance costs which do not contribute to customer features and so should be minimised costs that neither contribute to customer features/benefits nor must be maintained (muda) and so should be eliminated if possible. |
Muda (waste) includes all of: | any activity which does not contribute to customer or organisation benefit/features in the product activities which do not yield any benefit to the organisation or any benefit to the organisation’s customers excess production and early production delays movement and transport poor process design inventory inefficient performance of a process making defective items. |
Sectors
Not applicable
Competency Field
Competitive systems and practices