Kaizen - Japanese strategy of continuous business improvement

11 November 2012 06:30 pm

In Japanese, Kaizen means ‘improvement’ or ‘change for the better’. It refers to philosophy or practices that focus upon continuous improvement of processes in manufacturing, engineering and business management. In troubled times, the application of Kaizen will offer the management of any organisation a fool-proof strategy of continuous business improvement.

Kaizen was first implemented in several Japanese businesses after the Second World War, influenced in part by American business and quality management teachers who visited the country. It has since spread throughout the world and is now being implemented in many other venues besides just business and productivity.

We’ll look at Kaizen by answering three questions: What is Kaizen? What are the benefits of Kaizen? What do you need to do to get started using Kaizen principles?

Kaizen is a system that involves every employee - from the upper management to the cleaning crew. Everyone is encouraged to come up with small improvement suggestions on a regular basis. This is not a once a month or once a year activity. It is continuous. Japanese companies, such as Toyota and Canon, a total of 60 to 70 suggestions per employee per year are written down, shared and implemented.
In most cases these are not ideas for major changes. Kaizen is based on making little changes on a regular basis: Always improving productivity, safety and effectiveness while reducing waste.

Suggestions are not limited to a specific area such as production or marketing. Kaizen is based on making changes anywhere that improvements can be made. The Kaizen philosophy is to “do it better, make it better and improve it even if it isn’t broken, because if we don’t, we can’t compete with those who do.”

Quality circles, automation, suggestion systems, just-in-time delivery, Kanban and 5S are all included within the Kaizen system of running a business. (Kanban is a scheduling system for lean and just-in-time (JIT) production/ordering. It helps determine what to produce, when to produce it and how much to produce or what to order, when to order and how much to order).



Employee involvement
Kaizen involves every employee in making change—in most cases small, incremental changes. It focuses on identifying problems at their source, solving them at their source and changing standards to ensure the problem stays solved.
These continual small improvements add up to major benefits. They result in improved productivity, improved quality, better safety, faster delivery, lower costs and greater customer satisfaction. On top of these benefits to the company, employees working in Kaizen-based companies generally find work to be easier and more enjoyable—resulting in higher employee morale and job satisfaction and lower turnover.
With every employee looking for ways to make improvements, you can expect results such as:

• Kaizen improves space utilization, product quality, use of capital, communications and production capacity and employee retention.
• Kaizen reduces waste in areas such as inventory, waiting times, transportation, worker motion, employee skills, over production, excess quality and in processes.
• Kaizen provides immediate results. Instead of focusing on large, capital intensive improvements, Kaizen focuses on creative investments that continually solve large numbers of small problems. Large, capital projects and major changes will still be needed and Kaizen will also improve the capital projects process, but the real power of Kaizen is in the ongoing process of continually making small improvements that improve processes and reduce waste.

Corporate culture
For most global companies, Kaizen involves a significant change in the corporate culture. The attitudes of employees - from top management down to new hires will need to change. Kaizen needs to become something all employees do because they want to and because they know it is good for them and the company. It cannot be something employees do because the management dictates that it be done. That means that if the management isn’t ready to lead by example, Kaizen will not get off the ground.

Employee training and communication are important. For example, a manager spending a week on the floor working with employees to help and encourage them to develop suggestions will help. That manager should also ensure employees see their suggestions acted on immediately. Suggestions should not be implemented next month or next week, but today. In some cases, a suggestion submitted in the morning can be implemented that afternoon or sooner. Employees should be kept informed about what happens with their suggestions.

If it is the first time, it may be a good idea to bring in outside experts to get Kaizen started. They can serve as a ‘seeds’ allowing employees to see how Kaizen works and to experience the benefits of Kaizen. In Kaizen, problems are opportunities to improve. Kaizen encourages and rewards the identification of problems by all employees.

To encourage the submission of suggestions, a part of each supervisor’s evaluation should be based on the number of suggestions submitted by those they supervise. In that way, the supervisors and managers can be assessed how well they are doing at getting those who work for them to actively participate in Kaizen.

Managers should develop methods to help create suggestions and increase the number of suggestions. For example, set up teams of five to 12 people to evaluate work areas, processes, quality, productivity and equipment availability/reliability. The team then makes suggestions for improvements and they may even implement those improvements.

Continuity
One of the most difficult aspects of introducing and implementing Kaizen strategy is assuring its continuity. When a company introduces something new, such as quality circles, or total quality management (TQM), it experiences some initial success, but soon such success disappears and the management keeps looking for a new flavour. This is because the company lacks the first three most important conditions for the successful introduction and implementation of Kaizen strategy.

Conditions
Following are the seven conditions for successful implementation of Kaizen strategy:

• Conducting training and education
• Setting up an organisation dedicated to promote Kaizen
• Top management commitment
• Top management commitment
• Top management commitment
• Appointing the best available personnel to manage the Kaizen process
• Establishing a step-by-step process for Kaizen introduction

All conditions are important. Without the top management supporting every move, however, the trial will be short-lived regardless of other preconditions. The top management may express commitment in many different ways and it must take every opportunity to preach the message, become personally involved in following up the progress of Kaizen and allocate resources for successful implementation.

Process
The quick and easy Kaizen process works as follows:

• The supervisor reviews the idea within 24 hours and encourages immediate action.
• The employee identifies a problem, waste or an opportunity for improvement and writes it down.
• The employee develops an improvement idea and discusses it with his or her supervisor.
• The employee implements the idea. If a larger improvement idea is approved, the employee should take leadership to implement the idea.

The idea is written up on a simple form in less than three minutes.
Supervisor posts the form to share with and stimulate others and recognizes the accomplishment.

Key characteristics
There are three main features you should adapt, if Kaizen is to be successful.

• Continuous flow of small ideas. The smaller the ideas, the better. Kaizen is small ideas. Innovation takes time and is costly to implement, but kaizen is just day-to-day small improvements that when added together represent both enormous savings for the company and enormous self-esteem for the worker.
• Permanent method changes. Change the method. Once the change is made, you can’t go back to the old way of doing things.
• Immediate local implementation. Be realistic. Kaizen is done within realist or practical constraints.

Finally, to sum up, let me explain the Kaizen mind-set in seven simple points.

• Think beyond even if something is working. Find ways to make it work better
• Do not criticize, suggest an improvement
• Not a single day should go by without some kind of improvement being made
• Everything can and should be improved
• Imagine the ¡deal customer experience and strive to provide it
• Think of how to improve it instead of why it cannot be improved
• See problem solving as cross-functional systemic and collaborative approach

(The writer is a corporate director with over 25 years’ senior managerial experience. He can be contacted at lionwije@live.com)