Non value added activity

A non value added activity is an action taken that does not increase the worth of what is delivered to the customer. A process improvement study looks for and tries to eliminate these activities. By doing so, a business can reduce its costs while at the same time increasing the speed of its processes. For example, a process might include a review or approval step that does not add value to the end product; if this step can be redesigned or eliminated, the efficiency of the organization is enhanced. Non value added activities can comprise a significant proportion of the work processes of an organization.

Related Courses

Activity-Based Management  
Lean Accounting Guidebook 
Project Management