The Ultimate Guide to Kaizen

Definition of Kaizen

“Kaizen” is the philosophy of continuous improvement. Lean manufacturers use kaizen to help eliminate waste. With kaizen, manufacturers continuously improve standardized processes, equipment, and other daily production procedures. The main requirement is that existing procedures be standardized and documented so that improvements can be evaluated objectively.

Although primarily associated with manufacturing, businesses practice kaizen across all functions. Industries including healthcare, finance, psychotherapy, life coaching, government, and banking have also adopted kaizen.

Beyond improving workflows, kaizen helps facilitate a culture of ownership wherein workers identify and correct inefficiencies. This provides the added benefit of eliminating process wastes by reducing non-value-added activities.

History of Kaizen

Translated from Japanese, the word “kaizen” translates to “changing something for the better.” It was originally used by Japanese businesses after World War II, influenced by teachings in American business and quality management, and became adopted by the Toyota Production System (also known as TPS), where employees are famously required to stop the line if an abnormality arises (known as Jidoka) and, along with their supervisors, suggest an improvement.

Kaizen results in many benefits not only to a company’s operations and output, but also to its overall culture and communication. As a result of improvements to workflows and eliminating wastes, some of the expected benefits to a manufacturer’s production include:

• Increased productivity
• Improved quality
• Better safety
• Lower costs
• Improved customer satisfaction

Benefits to the overall company and its culture include:

• Improved communication
• Improved morale and employee satisfaction
• An increased sense of ownership in the company among employees

Kaizen is guided by a few key principles:

Good processes create good results.

At its core, kaizen is concerned with continuous improvement by reducing waste in processes, guided by the key belief that good processes lead to good results. In manufacturing, this means that reducing waste in a process adds value to the customer. In lean manufacturing, the 8 wastes (also known as muda, or any activity that consumes resources without creating value for the customer) are defined as:

• Defects: When a product is not fit for use it must be scrapped or reworked, adding cost to the production process without adding value.
• Waiting time: Unevenness in the work environment can lead to people waiting on material or equipment, or machines idling, and can result in overproduction or excess inventory.
• Extra motion: Unnecessary movement can place strain on personnel and not add additional value to the customer.
• Excess inventory: Excess inventory can cause inefficiencies and cause delays in the detection of problems. Problems can accumulate, and with more inventory, problems take longer to solve.
• Overproduction: Producing too much before it is required obstructs a smooth flow of work, raises the costs of production and storage, hides defects inside work-in-progress, and increases lead time.
• Extra processing: Excess activity as a result of poor tool or product design.
• Unnecessary transportation: Moving items that are not necessary for the process.
• Unutilized talents: Under-utilizing skills or assigning tasks to employees with insufficient training.

Improvements are based on small changes

Rather than wait for a major change to be implemented to begin improving, change should be approached in small, incremental steps. This increases the speed to improvement and reduces the pressures of implementing a major change. In addition, small changes are often less costly and therefore less risky.

To this end, a key to making incremental improvements is identifying and solving the root causes of issues. This allows employees to catch and contain small issues before they become larger and costlier to eliminate, and it prevents the same problems from reoccurring.

Improvements must be measurable, standardized, and repeatable

In kaizen, it’s important to “speak with data and manage with facts.” In order to evaluate improvements objectively, existing procedures must be standardized and documented. Further, improvements should be standardized, and all employees should be trained on new procedures associated with these improvements.

Measuring performance against existing benchmarks allows you to demonstrate ROI from your kaizen efforts and keep the company aligned around improvement. It also allows you to identify areas where your efforts are working–or not–so you can make strategic decisions about future improvements.

Empowering the Employees

Kaizen places emphasis on the value of employees at every level of an organization. Employees who are closest to the problem are the best-equipped to solve them. Further, engaging team members to identify problems and suggest improvements in their work areas encourages a sense of ownership over their work, which can improve overall motivation, morale, and productivity.

It’s also essential for management to be involved in your Kaizen efforts. Make sure your organization understands the importance of Kaizen to your business’s bottom line. Gaining buy-in is crucial to the success of your Kaizen initiatives, and if your organization’s leaders are committed to sustaining a culture of continuous improvement, they will set the tone for the rest of the company.

The Continuous Improvement Cycle and PDCA Cycle

According to John Shook, chairman and CEO of the Lean Enterprise Institute, the Continuous Improvement Cycle consists of three steps: seeing the workplace, identifying problems, and implementing solutions.

Another popular model is the PDCA cycle: plan, do, check, act. The American Society for Quality (ASQ) defines the PDCA cycle as follows:

• Plan. Recognize an opportunity and plan a change.
• Do. Test the change. Carry out a small-scale study.
• Check. Review the test, analyze the results, and identify what you’ve learned.
• Act. Take action based on what you learned in the study step: If the change did not work, go through the cycle again with a different plan. If you were successful, incorporate what you learned from the test into wider changes. Use what you learned to plan new improvements, beginning the cycle again.

Everyday Kaizen and Kaizen Events

Kaizen should be implemented on a day-to-day level in addition to holding periodic Kaizen events.

On a day-to-day level, the team should gather on a regular basis to discuss potential solutions to resolve a previously identified issue. This practice should be incorporated into already-established meetings that already occur regularly.

Kaizen events, also known as Kaizen blitzes, are short-duration events, usually in the form of a week-long workshop, in which a facilitator guides a team in improving an area with a specific aim in mind. These events may be held when there is an urgent issue that needs to be resolved, or as a focused exercise to identify areas for improvement on a periodic basis.

Typically during a Kaizen event, the facilitator leads the team (which is generally comprised of people who work in the area in which the event is being conducted) in standardizing and documenting processes and identifying, implementing, and documenting improvements to that area. After the event, improvement opportunities are prioritized based on the needs of the business.

When to hold a Kaizen event

While the principles of Kaizen should be practiced by all members of an organization on a continual basis, scheduled Kaizen events may be necessary in order to tackle larger problems. Also, maintaining a culture of solving the root cause of problems before they become bigger is key.

Reasons to hold a Kaizen event include:

• Solving an urgent problem that puts the business at risk and needs to be addressed quickly
• Achieving a strategic goal that will impact KPIs
• Identifying and solving the root cause of issues that prevent daily improvement cycles from achieving results
• Solving cross-functional challenges, such as improving the handoff of work between teams, including upstream and downstream events on a production value stream.
• Sustaining the practice of continuous improvement in your company, especially if you haven’t had a Kaizen event in a while
• Introducing new team members to continuous improvement techniques

Benefits of holding a Kaizen event

In addition to the primary benefits of improvement in your standard work processes, holding a Kaizen event can foster problem-solving, collaboration, and communication skills and allow employees to demonstrate leadership. Engaging team members to identify problems and suggest improvements in their work areas encourages a sense of ownership over their work, which can improve overall motivation, morale, and productivity. Finally, holding a Kaizen event is one way to reinforce a robust culture of continuous improvement within your organization, after all, the best way to sustain the principles that you want to guide your company is to put them into practice.

Planning a Kaizen event:

Investing time into planning your Kaizen event is critical to the event’s success; in fact, properly planning the event is just as important as the event itself. Set your team up for success by clearly defining the goals and scope of the event and strategically assembling a team that will bring insights and motivations to the table.

Holding a Kaizen Event:

Here is a typical outline for a week-long Kaizen event:

Day 1: Define your goals for the event. Map and measure the process’s current state and identify wastes. Decide on desired results.

Day 2: Consider root causes of wastes and identify possible solutions. Achieve consensus on improvements to be implemented. Document resources needed to apply improvements.

Day 3: Implement the improvements.

Day 4: Test the improvements. Measure the results of improvements made and apply any necessary adjustments. Standardize and document new procedures.

Day 5: Train employees on new standard work procedures. Communicate the changes to the organization. Recognize and reward team members who contributed to success.

Reflection is an important part of the continuous improvement cycle as well. Observe the workplace again after implementing kaizen. You’ll probably still see some wastes. This is a good place to be: since you already know what the problem is and what needs to be done, this is your opportunity to try some new ideas.

As you reflect on your efforts, develop your own kaizen guidelines. While there are many resources available to guide you through your kaizen efforts, it’s important to personally understand your company’s kaizen journey. Start by creating guidelines based on your own experiences improving the workplace. Keep in mind that these guidelines should be for your colleagues, your successors, and yourself to understand the problems you have overcome. These guidelines will ultimately help you as you approach your next challenge.

Implementing Kaizen in your organization requires a long-term commitment to a series of efforts and improvements. Building a mindset of continuous improvement among your organization’s culture requires daily practice, and with time, you’ll see an increase in the efficiency, productivity, and quality of your operations.