kaizen – a brief summary

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KAIZEN – A BRIEF SUMMARY

(Part 1)

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INTRODUCTION• If you can reduce the time it takes to carry

out your daily tasks by 30 seconds every business day for a year, at the end of that year, your productivity will have increased 26%.

• For every four units of product you were producing at the beginning of the year, you would be producing five units at the end of the year, and the labor for the fifth unit would be free.

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INTRODUCTION

• This simple example illustrates the power of KAIZEN. Small, incremental changes routinely applied and sustained over a long period will result in significant improvements.

• These improvements are based upon common sense, local participation, a long-term outlook and a continuing commitment to improvement.

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HISTORY

• As a consequence of its defeat in World War II and the democratic social revolution brought on by the ensuing American occupation, the Japanese economy was brought to a virtual standstill. With the outbreak of the Cold War, the United States recognized the need to revitalize the Japanese economy.

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HISTORY

• It was the intersection of these events that brought about a request from the United States Government to Dr. William E. Deming, who was asked to advise Japanese industries on ways to improve the quality of Japanese manufacturing.

• With a few noteworthy exceptions, Japanese manufactured goods had a dubious reputation for quality.

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HISTORY• The Japanese quickly infused Dr.

Deming’s ideas with elements of Oriental philosophies and concepts.

• It was this fusion of ideas that became known as KAIZEN ( later renamed Continuous Improvement in the United States).

• A modified and expanded KAIZEN returned to the USA with the Japanese import invasion of the 1970’s and 1980’s

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BENEFITS

• KAIZEN brings all the company’s mental resources to bear on the company’s problems, even those problems that are not recognized as problems.

• Benefits are generated in every aspect of the company’s performance

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BENEFITS

• These benefits include:– Improved product quality– Reduced product cost– Improved sales– Greater profits

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FUNDAMENTALS

– Definition of KAIZEN– Operating Principles of KAIZEN– The Deming Cycle– The KAIZEN Process– Types of Improvement in KAIZEN

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DEFINITION

• KAIZEN is a philosophy and approach for the

continuous incremental improvement of performance

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DEFINITION

• Philosophy

The word philosophy is defined as: a person‘s approach to life and his or her way of dealing with it.Although KAIZEN is typically promoted as a way to improve business performance, it is, in fact, designed to be aplicable to all activities.KAIZEN is a philosophy because it is intended to be applied to every aspect of your life, not just business performance.

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DEFINITION

• Approach

KAIZEN is tought of as an approach because its application follows a specific and systematic plan.This systematic plan is known as the Deming Improvement Cycle

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DEFINITION

• Continuous

One improvement sets the stage for another, and another, and everything is always up for improvement.Change becomes the expected norm of daily life

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DEFINITION

• Incremental

KAIZEN is about evolutionary change in the way processes are done.KAIZEN stresses moving the organization forward at a sustainable pace.It is not about revolutionary innovation, which, while a necessary activity, can be very disruptive to an organization.

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DEFINITION

• Improvement

KAIZEN uses a broad definition of improvement.Improvement is not put just in terms of product quality and/or productivity.Anything that increases the value-to-the-customer and/or decreases the relative resources/effort/time invested by the producer is considered improvement.

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DEFINITION

• Performance

Performance is defined as the effectiveness with which someting is done. This includes everything that goes into making the product and delivering it to the permanent possesion of the customer.Performance includes both quality and productivity

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OPERATING PRINCIPLES

• We need to improve!

Implementing KAIZEN requires more than just memorizing the definition, learning the fundamentals and preaching the Deming Improvement Cycle.All employees must accept the need for continually improving performance, must accept the responsibility for improving performance, and must participate in improving performance.

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• Part of daily life!

There was change in the work place yesterday, there is change today, and there will be change tomorrow.Some kind of improvement is made somewhere in the company every day.Employees expect and accept it as a part of everyday routine.

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• Emphasizing long term planning!

Short term profits do not insure a company‘s survival.KAIZEN takes a long term approach of investing in a relationship with the customer and a reputation in the market place.It is these relationships that are the ultimate assurance of business survival

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• Customer driven!

All product/process improvements should ultimately be aimed at increasing the customers‘ satisfaction.Satisfied customers are like homing pigeons; they always return home, and as long as they do, the business goes on.

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• Open to suggestion!

KAIZEN encourages employees to suggest alternate approaches.A suggestion box is standard and an award system for good suggestions is recommended.

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• Quality dominated!

Product quality must always be the first consideration.Always remember that producers of superior products can ask for and will receive higher prices for their productsProducers of inferior products can‘t and won‘t!

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• A learning environment!

A learning environment is essential to KAIZENEmployees need to be cross-trained in order to be full participants in the improvement process.As the KAIZEN environment is contantly changing, employees must constantly learn and relearn their jobs and the jobs of those around them.Remember, it takes more process knowledge to prevent defects than simply to detect them.

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• Reality based!

The fact that the company has problems in every department must be fully accepted.Problems must be a safe subject.Employees must be allowed to point out problems, admit problems, and suggest improvements without fear of retribution.

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• Team centered!

Problem solving is a team responsibility.It is everyone‘s job and everyone‘s input and effort will be needed to complete the job successfully.

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• Adaptable employees!

KAIZEN encourages cross training and flexible attitudes towards task restructuring.Employees should not become attached to what they do or to how they do it.The team with most versatile members wins.

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• Tenacity rules!

Not everything works out.When it doesn‘t we back up, figure out what went wrong, learn from the experience, and move forward.We never give up!

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• Optimal solutions!

Focus is on finding ways to improve quality while reducing costs.This is the wining solution!

• One constant question!

How can we improve our performance?

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THE DEMING CYCLE• PDCA Cycle

The Deming Improvement Cycle (PDCA) is named after Dr. William E. Deming the father of Japanese Quality Assurance. It consists of a four step procedure for making improvements

Plan: gather information and ideas, and then select an optimal approach to making an improvementDo: implement the changes. This is a prototype step to demonstrate the practicality of the change(s). It is important that this dry-run be executed in a manner which is as close as possible to normal production conditionsCheck: gather data on the effects of the change. Compare performance with both the previous and planned performance levels. Seek to explain any variation from those benchmarks.Act: lock-in changes (assuming they were good) by updating the documentation (process instructions, standard operating procedures, training materials, maintenance procedures, product and material specifications).

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THE DEMING CYCLE• Improvements must be sustained!

The most significant changes that Dr. Deming brought in from the methods that existed before were:

He placed new emphasis on carefully reviewing the effects of the changes (checking)He stressed the importance of permanently locking-in the changes through documentation (acting)He put forward the ideea that each improvement sets the stage for another improvement... Hence the word Cycle

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THE PROCESS

• DefinitionA combination of operators, methods, materials, and equipment which lead to a result or output

• DiscussionKAIZEN sees improving the process as the path to all aspirations. No matter what the specific goal is, the solution to the problem can be found in an improved process.

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THE PROCESS

• Process improvementA process may be improved by:

Adding to the customers‘s perception of value received (a better

product)

Reducing the cost or the amount of the input (materials, labor, capital,

or managerial expense) ( a less costly product)

Reducing the variation in the output of the process (a more consistent

product)

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THE PROCESS

• Process improvement:The essential steps:

Standardize the process – there should be only one way to do the

process

Baseline the process – imitate those who do the process in the best

way known

Improve the process – gain knowledge and practical experience about

the process, then begin to change the process for the better

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TYPES OF IMPROVEMENT

• The nature of improvement: – Innovation– Change– Imitation

Of these three approaches KAIZEN utilises IMMITATION & CHANGE

In order to understand why KAIZEN has this preference, one must understand the benefits and drawbacks of these different ways of achieving improvement.

Note:

In reality, none of these approaches occur purely on their own. Life is lives in shades of gray.

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• Innovation:

Definition:

Innovation is the introduction of a new process.

Participation:

The participation in innovation is highly oriented toward the technical and managerial classes. The average employee is left observing from the sideline.

Benefits:

The benefits of innovation can be remarkable. Significant advances in both productivity and quality can be achieved.

Drawbacks:

The potential drawbacks of innovation can be as bad as the benefits are good. Innovation not only has a high rate of failure, its failures tend toward the spectacular.

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• Drawbacks:

Development can be a series of nightmares

As the product/process being developed is new, there is no realistic basis for timelines or budgets – not that this will deter management from imposing them.

The concept of repeating prototyping as part of development, while essential is likely to be frowned upon.

Unforseen delays, cost overruns and outsized expectations can be detrimental to the innovator‘s career path.

Innovation is higly disruptive to the organization

Innovation causes widespread disruptions in the production tempo (production control), material utilisation (purchasing, warehousing), workforce structure (personnel), quality standards (quality assurance)

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• Drawbacks:

Innovation damages employee morale

Valued employees who are higly experienced with current processes/equipment/products are turned into novices requiring retraining.

Psychologically, they loose their position in the company‘s social order and feel insecure in their employment.

The employee feeling of selfworth is diminished.

Unanticipated consequences are common

New products/processes almost always have surprising interactions in the work environment.

Customer and employee responses often do not match initial projections.

Even worse, these unanticipated consequences may be far enough away from the innovation so connecting the consequences to the innovation is very difficult, especially when the consequences do not emerge until after the project is considered complete

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TYPES OF IMPROVEMENT• Drawbacks:

Innovation can backfire strategically

The innovation may be imitated.

A successful imitatorwill have the advantage of the innovation without the burden and investment required to create the innovation from scratch.

• Innovation example:

An example of a pure innovation is the introduction of a totally new product that requires completely new processes

There is no product or process knowledge to fall back on. From the operator’s viewpoint, everything must be learned or invented.

This combination is highly disruptive and can be a real nightmare if things don’t go well.

As with all innovations, the workforce is skewed toward the technical end.

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• Change:

Definition:

Change is the introduction of new elements into an existing process/design.

Participation:

Thea participation in change is very broad. It is usually concentrated among those employees with the most experience and those who will be directly affected by the change.

Benefits:

The main benefit of change is that it can achieve the extensive improvement with a minimal amount of cost and disruption.

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• Drawbacks:

Change tends to be slow

Individual changes tend to produce only small improvements.

The benefits of change iare cumulative over time.

Progress is difficult to perceive and the process requires patience.

Change tends to be difficult for management to track

When change is the order of the day, it tends to be diffused around the entire plant (a lot of changes going on in a lot of different places) and the changes tend to be detail specific (difficult to understand unless you are very familiar with the processes)

Change tends to be very difficult to drive in a specific direction

KAIZEN is based on „locally owned“ teams.These teams tend to prioritize their work based on the problems they see in their areas.

This approach typically doesn‘t match up with management‘s integrated objectives.

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• Change example:

A good example of a change is the introduction of a better tool – let’s say a higher torque air screwdriver for an operation where the self-tapping screws are difficult to finish off.

First, we have only changed one element of the process.

The operator’s product knowledge is unaffected and the change to the process (holding the screwdriver a little tighter) is minor.

The operator will quickly adapt to the new conditions; the product quality will improve, and the disruption to production will be negligible.

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• Imitation:

Definition:

Imitation is the introduction of processes or process elements already in existence elsewhere.

Participation:

Participation in imitation is is the broadest of the three types of improvement. Imitation requires less effort than comparable changes or innovations, and the effort tends to be concentrated among those who will be directly affected by the imitation.

Benefits:

Imitation brings with it a great deal of certainty. The inputs of material, labor and capital can be easily estimated, and management expectations are both focused and realistic. The risk of failure is very limited, and mistakes in execution are generally easily corrected.

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• Drawbacks:

ILL repute

From our earliest childhood we have been taught not to copy other people‘s work. This is an effort to make school children to learn their lessons.

Unfortunatelly, a great many people have failed to make the leap to the adult concept of „learning by example“.

This immature attitude is the chief drawback to imitation.

Innacurate evaluation by management

Because imitation is held in such low regard, management will often underrate the performance of those individuals involved, regardless of the benefit to the company.

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• Imitation example:

To a large extent, an imitation is nothing more than a change where the outcome is already known.

A good example of imitation is the introduction of a tool – let’s say a center punch – which you have seen used elsewhere (inside or outside of the plant).

A center punch is a simple spring loaded tool that improves the accuracy of drilling.

The addition of the center punch step is the only change in the product/process knowledge.

Once again, product quality has been improved and although we have added a step, because of the improved accuracy, rework will be reduced and total processing time will probably be unaffected.

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kaizen – a brief summary

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