Page 36 - FoodFocusThailand No.219 June 2024

SPECIAL FOCUS

income, influenced by factors beyond national borders. For wasteful or unproductive in terms of utilizing workers’ time and
instance, the automotive sector, boasting an annual economic potential to their fullest capacity. Such loss can impact both
value surpassing trillions of baht, incurs expenses tied to frontline workers and supporting units, including maintenance,
imported auto parts and machinery, car design, recruitment engineering, warehouse, quality control, and production
of foreign personnel, and international brand licensing fees. planning departments. Furthermore, while nonfunctioning
Conversely, the primary inputs for the food industry often machinery is often seen as a mere loss of resources, adopting
comprise domestically sourced raw materials. Therefore, a different mindset reveals it as a cost incurred through missed
augmenting agricultural output to increase yields can yield opportunities. This perspective sheds light on overlooked
positive repercussions on the nation’s overall productivity aspects such as wasted time for value setting and adjustments,
and the equitable distribution of wealth among local farmers, potential losses during batch changes due to machine
who constitute a significant portion of the population. downtime, reduced operational speed, subpar performance,
and waste issues. These considerations are particularly relevant
Loss and Cost Reduction in Production in the context of the “green earth” trend, which emphasizes
energy conservation, reduced greenhouse gas emissions, and
Processes the careful selection of green energy sources.
Added value hinges on two primary factors: input and output.
Consequently, the generation of added value can be achieved Addition of Value to Products
through two methods: waste/cost reduction and value Another value-adding strategy involves either maintaining the
creation. The former entails minimizing input usage and same input quantity or investing more in inputs to increase
identifying pivotal areas susceptible to losses. Unused goods production. This added value can be achieved by scaling
ingredients represent missed opportunities to enhance added up either the quantity or the value of products. In the
value, while certain stages are inherently more prone to contemporary landscape, technology is advancing rapidly, albeit
losses. This concept can be encapsulated in the following with technology costs trending downwards. Consequently, the
equation (2): break-even points for adopting new technologies are becoming
more attainable. However, businesses must ensure that their
Input = Output + Waste (2) production systems strike a balance between manual operation,
automation, and semi-automation to remain competitive.
For instance, not all fish make it to the canned fish industry One of the primary advantages of automation is its capability
shelves due to various factors like non-standard raw material to mitigate the risks of human-induced contamination. With
size, prolonged storage, stacking-induced bruises, subpar round-the-clock operation, automation can be consistently
quality, and the removal of undesirable parts like bones and maintained through proper upkeep and maintenance planning.
intestines, resulting in input loss. Moreover, loss occurs However, human ingenuity shines brightest in fostering
through damage in production, low-quality output, transport creativity, which is instrumental in driving continuous
mishaps, and oversupply, prompting manufacturers to slash improvement. Guided by the Kaizen principle, the process of
prices to clear excess stock. Nonetheless, efficient loss adding technological value encompasses every physical
management is key to reducing production costs, a principle procedure, spanning from ingredient reception, food processing,
every factory should prioritize. and packaging to intra-facility logistics, warehouse management,
and customer delivery. This principle also encompasses
Expanding the perspective to encompass the lean
principle, which asserts that any process or input not leading technologies for data management, including storage, analysis,
processing, and reporting via dashboard monitors, smartphones,
to customer satisfaction is deemed “loss”, enables or other communication devices. Furthermore, current
manufacturers to view loss from a more comprehensive technological opportunities include automation, blockchain for
standpoint. Loss isn’t confined to raw materials; it also traceability, Internet of Things (IoT), and RFID tag sensors,
encompasses a vital organizational asset: human labor. This enabling real-time tracking across the entire supply chain.
definition of loss extends to the creation of benefits that prove Moreover, 3-D printing technologies cater to individual client
needs, AI systems aid in quality control, and cloud systems
reduce the necessity for physical IT investments. Added value
creation extends to enhancing various product aspects to
augment consumer perception: refining product features,
evoking consumer emotions through comprehensive studies
of consumer behavior, and analyzing emerging social trends
such as aging populations and alternative dietary preferences.
The foundation of a successful business lies in the ongoing
enhancement of productivity through added value, achieved by
both minimizing loss and maximizing value creation. This
operational objective is attainable through effective management
of resources, processes, and data, coupled with the strategic
application of appropriate technologies to develop products that
precisely meet consumers’ demands.

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