The most common usage applies to when a work area encloses a person, trapping them inside. It is usually commonly applied to manufacturing areas where material racks and workbenches isolate a person, but cubicles act in a very similar way. They separate people from each other, and raise the cost of dealing with problems dramatically. They also serve as a barrier to communication and teamwork.
In the second, less common usage, it describes an object that stands in the middle of an open area, disrupting flow. Basically, it is a relatively small, moveable object that is needed (currently) for production, but gets in the way of flow. In a manufacturing area, this might be a garbage can. In an administrative area, it might be a cart full of reference manuals.
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While both usages of the term differ dramatically, they both disrupt flow and create waste. The lesser of the problems is the stand-alone object. Those tend to be relatively simple to figure out how to eliminate. As space requirements are reduced, the birdcage can be integrated into a more out of the way location.
The enclosed workspaces are a bigger problem for a few reasons. First, people may enjoy their privacy, and may push back against losing that. This is especially problematic in office environments. People there value individual workspaces more than shop floor workers do.
Some of reasoning behind this resistance is valid from a work performance perspective. Speaking with a customer is easier when there are not a lot of distractions. But many other reasons are not as valid. Sometimes, people like privacy to do things that they are probably not supposed to be doing, such as catching up on holiday shopping. Though most people don’t overdo these microbreaks, it does make them look bad when a boss sees them surfing the web. In addition, some people just prefer to have their own work space that they can individualize. Cubicles provide that to them.
On the shop floor, birdcages are often a function of a process oriented work area. A single worker may be assigned to operate several lathes, for example. The wall of machinery acts as a barrier to the outside world.
Whether in the office or on the shop floor, communication is restricted when working in enclosed spaces. It is much easier to turn your head to ask a question than it is to send an e-mail, make a call, or walk out of your cube.
In manufacturing, birdcages limit the use of visual controls. Operators cannot see andon lights in adjacent work areas, and have a hard time monitoring production boards. Flow is restricted, walking increases, collaboration is diminished, and people are more likely to batch up additional product.
Birdcages can be reduced in the office by forming group work areas, commonly called bullpens, or by lowering the heights of cubicle walls.
Manufacturing birdcages are reduced by focusing on flow and reducing the space needed to store materials. Product oriented work cells also act to limit birdcages and improve communication.