Kaizen Operations Management : Small Business Plan Template : Lean Business Club, Inc.

OPERATIONS MANAGEMENT
CHECK POINT 77: KAIZEN

This Check Point Is Available By Subscription Only,
But You Can Still Check Out The Menu Below.

1.	introduction to kaizen
2.	what really is kaizen?
3.	kaizen company comparison with traditional companies
4.	the main purpose of kaizen
5.	Main Tasks Of A Kaizen Company
6.	Management Action In A Kaizen Company
7.	kaizen and total quality control
8.	japanese versus western approach to quality control
9.	Total Quality Control Emphasis On Managing Processes
10.	Kaizen And The Suggestion System
11.	Process-Oriented Versus Result-Oriented Management
12.	Cross-Functional Management And Training In A Kaizen Company
13.	Implement Kaizen In Your Company
14.	Implement The Plan-Do-Check-Act (PDCA) Cycle In Your Company
15.	Standardized Work In A Kaizen Company
16.	Implement Standardized Work In Your Company
17.	Conduct Kaizen Events In Your Company
18.	Develop A Kaizen Project In Your Company
19.	Essential Kaizen Implementation Methods
20.	Practical Application Of Kaizen
21.	For Serious Business Owners Only
22.	The Latest Information Online

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Level 4: We Plan To Start A Small Business Without Employees.		V
Level 5: I/We Plan To Start A Small Business With Employees.	V
Level 6: I Am A One-Person Business Owner.		V
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OPERATIONS MANAGEMENT
CHECK POINT 77: KAIZEN

Please Select Any Topic In Check Point 77 Below And Click.

1.	introduction to kaizen
2.	what really is kaizen?
3.	kaizen company comparison with traditional companies
4.	the main purpose of kaizen
5.	Main Tasks Of A Kaizen Company
6.	Management Action In A Kaizen Company
7.	kaizen and total quality control
8.	japanese versus western approach to quality control
9.	Total Quality Control Emphasis On Managing Processes
10.	Kaizen And The Suggestion System
11.	Process-Oriented Versus Result-Oriented Management
12.	Cross-Functional Management And Training In A Kaizen Company
13.	Implement Kaizen In Your Company
14.	Implement The Plan-Do-Check-Act (PDCA) Cycle In Your Company
15.	Standardized Work In A Kaizen Company
16.	Implement Standardized Work In Your Company
17.	Conduct Kaizen Events In Your Company
18.	Develop A Kaizen Project In Your Company
19.	Essential Kaizen Implementation Methods
20.	Practical Application Of Kaizen
21.	For Serious Business Owners Only
22.	The Latest Information Online

DO I NEED TO KNOW THIS CHECK POINT?

Management Level	Yes	Optional
Level 1: I Am An MBA Student.	V
Level 2: I Am A Professional Manager In A Company.		V
Level 3: I Plan To Start A One-Person Business.		V
Level 4: We Plan To Start A Small Business Without Employees.		V
Level 5: I/We Plan To Start A Small Business With Employees.	V
Level 6: I Am A One-Person Business Owner.		V
Level 7: I Am A Small Business Owner With Employees.	V
Level 8: We Are Small Business Owners Without Employees.		V
Level 9: We Are Small Business Owners With Employees.	V
Level 10: I Am A Management Consultant Or A CPA.	V

WELCOME TO CHECK POINT 77

TUTORIAL 1 General Management				TUTORIAL 2 Human Resources Management				TUTORIAL 3 Financial Management				TUTORIAL 4 Operations Management				TUTORIAL 5 Marketing And Sales Management
1	6	11	16	21	26	31	36	41	46	51	56	61	66	71	76	81	86	91	96
2	7	12	17	22	27	32	37	42	47	52	57	62	67	72	77	82	87	92	97
3	8	13	18	23	28	33	38	43	48	53	58	63	68	73	78	83	88	93	98
4	9	14	19	24	29	34	39	44	49	54	59	64	69	74	79	84	89	94	99
5	10	15	20	25	30	35	40	45	50	55	60	65	70	75	80	85	90	95	100

HOW CAN YOU BENEFIT FROM CHECK POINT 77?

The main purpose of this check point is to provide you and your management team with detailed information about Kaizen and how to apply this information to maximize your company's performance.

In this check point you will learn:

• What is kaizen?
• About the differences between a kaizen company and a traditional company.
• About the main purpose and tasks of a kaizen company.
• About the differences between Japanese and Western-style approach to quality control.
• About cross-functional management and training in a kaizen company.
• How to implement kaizen in your company.
• How to implement Plan-Do-Check-Act (PDCA) Cycle in your company.
• How to implement standardized work in your company.
• How to conduct kaizen events and develop kaizen projects in your company.
• About essential kaizen implementation methods. and much more.

LEAN MANAGEMENT GUIDELINES FOR CHECK POINT 77

You and your management team should become familiar with the basic Lean Management principles, guidelines, and tools provided in this program and apply them appropriately to the content of this check point.

You and your team should adhere to basic lean management guidelines on a continuous basis:

•	Treat your customers as the most important part of your business.
•	Provide your customers with the best possible value of products and services.
•	Meet your customers' requirements with a positive energy on a timely basis.
•	Provide your customers with consistent and reliable after-sales service.
•	Treat your customers, employees, suppliers, and business associates with genuine respect.
•	Identify your company's operational weaknesses, non-value-added activities, and waste.
•	Implement the process of continuous improvements on organization-wide basis.
•	Eliminate or minimize your company's non-value-added activities and waste.
•	Streamline your company's operational processes and maximize overall flow efficiency.
•	Reduce your company's operational costs in all areas of business activities.
•	Maximize the quality at the source of all operational processes and activities.
•	Ensure regular evaluation of your employees' performance and required level of knowledge.
•	Implement fair compensation of your employees based on their overall performance.
•	Motivate your partners and employees to adhere to high ethical standards of behavior.
•	Maximize safety for your customers, employees, suppliers, and business associates.
•	Provide opportunities for a continuous professional growth of partners and employees.
•	Pay attention to "how" positive results are achieved and constantly try to improve them.
•	Cultivate long-term relationships with your customers, suppliers, employees, and business associates.

1. INTRODUCTION TO KAIZEN

WHAT IS THE SECRET OF THE JAPANESE SUCCESS?

Business owners and operations managers must become familiar with the basic guidelines related to Kaizen to ensure a cost-effective and profitable performance of the organization in a highly competitive market environment.

Ask yourself this simple question:

How is it possible that Japan, a relatively small country in territory with about 80 million people, who live on a chain of islands in a Pacific Ocean far away from the rest of the Western World, and who have no mineral resources, became one of the biggest economic power-houses in the World in the 20th and 21st Century?

The answer can be given in one word and the word is: KAIZEN ® (pronounced: KY'ZEN).

INTRODUCTION TO KAIZEN

You must be intrigued that one word, Kaizen, may have so much power. You are right! Kaizen has been widely used in Japan for centuries, while the majority of business owners and managers in the world started to discover kaizen only since 1980's.

Some of the information in this check point is based on KAIZEN The Key To Japan's Competitive Success, authored by Masaaki Imai. The first edition of this book was published by Random House in 1986 and it is currently available from The McGraw-Hill Companies, Inc. With this book, Masaaki Imai actually introduced kaizen to the entire Western World.

Masaaki Imai, who is the chairman of Kaizen Institute, Ltd. - an international consulting company, has authored several additional books. One of those books - GEMBA KAIZEN, is of particular importance to all those who are interested in improving the performance of their organizations.

Note:

KAIZEN and GEMBA KAIZEN are registered trademarks of Kaizen Institute, Ltd .

ADDITIONAL INFORMATION ONLINE

•	Definition Of Kaizen By Masaaki Imai, KAIZEN963.
•	Kaizen Overview By Ron Perera, Gemba Academy.
•	Kaizen Improvement Process By Educate Virtually.
•	Kaizen The Keys To Continuous Improvement By Joe Boyle.
•	Kaizen Strategy For Continuous Improvement By Firecity Vijay.

2. WHAT REALLY IS KAIZEN?

DEFINITION OF KAIZEN

According to Masaaki Imai, Kaizen Strategy is the single most important concept in Japanese Management - the key to Japanese competitive success.

In the Japanese language, the word Kaizen means: "Improvement". This word means improvement in personal life, home life, social life, and work life. When applied to the workplace, kaizen means continuous improvement involving everyone - business owners, managers, and workers alike.

In a nutshell, kaizen may be a short word, but it represents a very deep and strong culture - a culture of continuous all-around improvement of everything and everywhere. In Japan, kaizen is everybody's business!

Kaizen is, apparently, one of the most commonly used words in Japan. As a concept, kaizen is totally ingrained in the minds of Japanese people who "think" kaizen without realizing it. Furthermore, many successful Japanese companies adopted kaizen strategy as their basic approach to business management.

As Masaaki Imai notes, many Western business people have been asking for many years how did the Japanese companies achieve such a phenomenal success. Well, the secret is out - and its name is kaizen! (20)

THE TOYOTA PRODUCTION SYSTEM

Kaizen represents one of the main building blocks of The Toyota Production System (TPS) which was developed by Toyota Motor Corporation in Japan about seventy years ago.

The Toyota Production System provided the foundation of Lean Manufacturing, which gradually evolved into Lean Management and became applicable to a broad range of small, medium-sized, and large organizations. Today, lean management principles, values, methods, and guidelines are equally important to manufacturing and non-manufacturing companies alike.

The Toyota Production System is based on several well-known Japanese management methodologies, including Kaizen, Just-In-Time, Jidoka (Autonomation), and Total Productive Maintenance (TPM) presented below.

MAIN PILLARS OF THE TOYOTA PRODUCTION SYSTEM


Kaizen	Just-In-Time	Jidoka (Autonomation)	Total Productive Maintenance (TPM)

LEAN MANAGEMENT

The basic objective of Lean Management is to maximize the overall performance and profitability of an organization by providing maximum value to customers based on best possible product and service quality, reliability, price, warranty, and after-sales service while minimizing waste and operational costs.

The main focus of lean management is to satisfy customers' needs, to identify value-added and non-value-added activities, to eliminate waste, to develop a continuous and uniform workflow, to reduce operational costs, to improve quality of products and services, to develop more efficient delivery of products and services to customers in a timely manner, and to provide respect to everybody who is engaged in the company's business process: employees, associates, partners, and suppliers.

As a result of implementing Lean Operational Guidelines, the company's management can expect a continuous improvement in operational performance and increased profitability in a highly competitive market environment. For this reason you and your management team should study lean management principles, methods and guidelines and implement them in your organization.

Lean Management is discussed in detail in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Four Principles Lean Management By Four Principles.
•	Introduction To Lean Manufacturing By Value Streams.
•	Toyota Executive On Lean Management By Virtual Assistance.
•	Lean Manufacturing Tour By Phillip Beyer, Ebiz Products.
•	Lean Summit 2008 - Presentation By Jim Womack, Lean Enterprise Academy.

3. KAIZEN COMPANY COMPARISON WITH TRADITIONAL COMPANIES

WHO CAN USE KAIZEN?

According to Masaaki Imai, you don't have to be Japanese in order to adopt the Kaizen Culture and way of thinking. Once you select Kaizen as your company's basic culture for getting things done, you will be able to fully appreciate the differences between the regular, or Traditional Companies and Kaizen Companies. These differences are summarized below.

KAIZEN COMPANY COMPARISON WITH TRADITIONAL COMPANIES

Area Of Comparison	Kaizen Company	Traditional Company
Company's Mission	To satisfy customers through continuous search for ways to improve overall quality.	To satisfy shareholders through continuous search for ways to improve profits.
Company's Commitment	Long-term commitment to quality.	Short-term commitment to profitability.
Company's Management	Open-minded to new ideas for improving existing methods.	Limited-minded to new ideas for improving existing methods.
Company's Main Orientation	Process orientation.	Result and innovation orientation.
Manager's Role	Provides continuous cross-functional training of subordinates and builds trust.	Provides specialized and limited training of subordinates and constantly issues new orders.
Employee's Role	Has the authority to constantly seek for better ways of getting the job done.	Must get the job done without being required to provide additional input regarding improvements.
Problem- Admittance Attitude	Management and employees have an open-minded approach to admitting problems.	Management and employees have a close-minded approach to admitting problems.
Problem- Solving Attitude	Everybody within the company is motivated to identify inefficiencies everywhere and come up with better solutions on an individual and group basis.	Most employees are guided to just get the job done as quickly as possible without being asked to look for better solutions.
Employee Training	Employees are cross-trained to accomplish a broad range of tasks.	Employees are trained to accomplish a narrow and specialized range of tasks.
Inter- Departmental Communication	Open communication related to a broad range of subjects.	Specific communication limited to a narrow range of subjects.
Employees Overall Orientation	Process and quality orientation based on a customer-driven motivation.	Product and service orientation based on a profit-driven motivation.
Employees Overall Evaluation	Employees are evaluated on the basis of process-oriented efforts in improving quality and long-term customer satisfaction.	Employees are evaluated on the basis of result-oriented effort in improving short-term profits.
Relationships With Suppliers	Open-minded, friendly, and mutually helpful.	Closed-minded, adversarial, and profit motivated.
Search For Improvements	Continuous search for improvement by everybody in the company.	Limited search for improvement by specially assigned employees in the company.
Attitude To Customers	To always meet and exceed customers' expectations.	To make sufficient profits while trying to meet customers’ needs.

4. THE MAIN PURPOSE OF KAIZEN

KAIZEN IN A BUSINESS ENVIRONMENT

Kaizen is a unique culture coupled with a very special attitude and at its core it means a continuous and gradual improvement of everything related to life. This relates to social life, home life, work life, business life, school and university life, and anything else which may affect people.

In relation to the Business Environment, kaizen means a continuous and gradual improvement of everything and everybody in the company, and around the company, i.e. management, personnel, facility, machinery, raw materials, finished products and services, suppliers, and customers.

Obviously, it may not be so easy to change those areas over which you might not have full control, like suppliers or customers. However, the understanding and subsequent adoption of Kaizen Attitude And Culture may help you to be better prepared in meeting the challenges of gradual and continuous improvements, and subsequent success in a highly competitive marketplace.

Since no business operates in isolation, you and your company's management must take into consideration a broad range of Suppliers and Customers with whom you do business on a regular basis. You must remember that all your suppliers and customers are part of the chain where your business is operating. Since you want to be successful in that chain, you must maximize your efforts in the area of overall improvements to ensure the chain's continuity in the long-term.

In order to understand the meaning and the main purpose of Kaizen In The Business Environment it may be helpful to illustrate how all elements of "your suppliers - your company - your customers" chain fit together.

KAIZEN AND SUPPLY CHAIN


Your Suppliers	Your Company	Your Customers
Management must ensure continuous and gradual improvement of all facets of the company's relations with pre-selected suppliers through continuous improvement in quality, price and delivery of products and services.	Management must ensure continuous and gradual improvement of all facets of the company's activities, from purchase of materials, through design, manufacture, and sale of products or rendition of services to customers.	Management must ensure continuous and gradual improvement of all facets of the company's relations with customers through continuous improvement in quality, price, if possible, and delivery of products or services.

5. MAIN TASKS OF A KAIZEN COMPANY

CRITICAL ROLE OF KAIZEN

Masaaki Imai states that Kaizen plays a critical role in accomplishing specific objectives and tasks in a kaizen-based organization as outlined below. It is essential, therefore, that you and your management team become fully familiar with these objectives and tasks and implement them in your company.

MAIN TASKS OF A KAIZEN COMPANY

1.	Maintaining Focus On Customers. Customers represent the main focus of a kaizen-based company. All employees understand that the main purpose of the organization is to satisfy customers' needs and provide them with the best possible value of products and services.
2.	Implementing The PDCA Cycle. The Plan-Do-Check-Act Cycle is applicable to all operational activities within every organization, including general administration, human resources, finance and accounting, operations, marketing and sales. The PDCA cycle has unlimited applications in various operational activities throughout the organization and it is widely used during kaizen workshops discussed below.
3.	Implementing Standardized work. standardized work, also known as standard work or standard operation, provides a summary of working procedures and instructions related to various operational tasks and activities which can be documented, measured and repeated in any organization. Standardized work may apply to a broad range of operational activities, such as general administration, human resources, finance and accounting, operations, marketing and sales.
4.	Implementing Just-In-Time Methodology. A kaizen-based company incorporates all relevant principles and guidelines related to just-in-time methodology. The prime objective of JIT methodology is to eliminate waste in the total manufacturing or operational process, from purchasing of raw materials through distribution of finished goods. A central part of just-in-time production is kanban which was first introduced by Toyota with an objective to minimize inventories, waste, and subsequent costs. The basic idea behind the JIT system is that the required parts should be received "just-in-time" for the manufacturing process. This methodology is discussed in detail in Tutorial 4.
5.	Using Kanbans. Kanban in Japanese means signboards, cards, or chits. In a just-in-time production environment a worker from the following process goes to collect parts from the previous process leaving a Kanban signifying a delivery of a given quantity of specific parts. When all parts have been used, the same kanban is sent back, at which point it becomes an order for more parts.
6.	Ensuring Zero Defects. Zero defects means that a kaizen company's policy is geared toward maintaining a zero-defect requirement in the operational facility to minimize the production costs per unit of product or operation and to maximize level of quality.
7.	Implementing Automation. Automation means that a kaizen company's policy is to maximize the automation of a broad range of manufacturing or operational process in order to minimize product or operation cost per unit, and to maximize the level of quality.
8.	Ensuring Total Quality Control (TQC) Total quality control, or TQC, is similar to TQM in the sense that a kaizen company is dedicated to improving quality of all processes on the organization-wide basis.
9.	Maintaining Quality Control Circles. Quality control circles, or QC circles, means that a kaizen company has a number of small groups of employees (10 - 12), who get together on a regular basis after working hours without additional pay, and discuss ways and means of improving quality in various manufacturing and related processes.
10.	Ensuring Quality Improvement. Quality improvement means that a kaizen company's policy is geared toward continuous improvement of quality everywhere, starting with product or process design and finishing with the customer after-sales service.
11.	Implementing Total Productive Maintenance (TPM). Total productive maintenance, or TPM, means that a kaizen company's policy is geared toward ensuring a total preventive maintenance in the operational facility to minimize the cost of production and production breakdowns, and to maximize the quality of products and operations.
12.	Using Robotics. Robotics means that a kaizen company's policy is to employ a broad range of low-cost automated machines and plants to minimize the production costs per unit of output, and to maximize the quality of the manufactured products.
13.	Implementing New Product Development. New product development means that a kaizen company's policy is geared toward the continuous development of new products, processes and services to secure the successful long-term performance of the company in a competitive marketplace.
14.	Maximizing Productivity Improvement. Productivity improvement means that a kaizen company's policy is geared toward maximizing the improvements in productivity through all possible methods discussed above with an objective to minimize the production costs per unit and maximizing the quality.
15.	Implementing A Suggestion System. Suggestion system means that a kaizen company has a special system of motivating employees to come up with new ideas related to their work within the company and these ideas are collected and evaluated on a regular basis. Those ideas, which indicate a possible improvement over the existing methods, are subsequently adopted by the company, and employees, or groups of employees, who came up with such ideas, are compensated respectively.
16.	Maintaining Cooperative Labor-Management Relations. Cooperative labor-management relations mean that a kaizen company's policy is designed to develop relatively friendly relations between management and employees to secure better communication and to minimize disruptions within the company.
17.	Maintaining Discipline In The Workplace.. Discipline in the workplace means that a kaizen company's policy is geared toward ensuring a strong discipline among employees in everything that relates to the company's activities.
18.	Supporting Small Group Activities.. Small group activities means that a kaizen company endorses the idea of motivating employees to identify certain issues of common interest and get involved on a small group basis. This may further enhance the communication and cooperation between employees within the company. A typical example of small group activities is quality control (QC) circles.

6. MANAGEMENT ACTION IN A KAIZEN COMPANY

IMPORTANCE OF KAIZEN

According to Masaaki Imai, it is essential to understand where Kaizen Guidelines fit between the development and innovation of new methods, products, processes, and services and maintenance of the existing ones.

It is also important to understand the different proportion between innovation and maintenance issues addressed by the Western and the Japanese managers and employees. Masaaki Imai suggests that all managers and workers in a kaizen-based organization systematically apply kaizen guidelines to improve existing operational activities, products and services on a continuous basis. On the other hand, only a small number of senior managers in a Western-style organization are engaged in innovating new processes and products, while the remaining managers and employees continue to maintain the existing processes and products without any real effort to improve them.

IMPORTANCE OF CONITNUOUS IMPORVEMENT

Masaaki Imai states that the worst companies are those which do nothing but maintenance, meaning that there is no internal drive by management and employees for Kaizen or innovation, development and change.

These elements are highly essential in order to survive and succeed in a highly competitive market environment. Masaaki Imai, therefore, suggests that specific action must be undertaken by business owners, managers and employees at various levels within the organization to ensure continuous improvement of operational processes, products and services, as outlined below.

MAIN ACTION TO BE UNDERTAKEN IN A KAIZEN COMPANY
BY TOP MANAGEMENT AND ALL EMPLOYEES

Business Owners And Top Management		Middle Management	Workers
1.	Business owners and senior managers must adopt and introduce kaizen as an essential element of the company's strategy and an integral part of its operational activities.	Middle level managers must adopt kaizen guidelines and develop detailed kaizen implementation procedures within the organization on a cross-functional basis.	Workers must adopt and actively engage in the kaizen guidelines' implementation process by participating in small group activities and by providing suggestions for process and product improvements.
2.	Business owners and senior managers must provide support and direction for effective implementation of kaizen guidelines by allocating sufficient time and resources.	Middle level managers must develop specific kaizen guidelines designed to ensure continuous improvement of all operational processes, products and services, and provide clear instructions to workers.	Workers must follow the kaizen guidelines implementation processes, demonstrate their commitment to these guidelines, and maintain discipline in the workplace.
3.	Business owners and senior managers must formulate cross-functional goals, based on kaizen guidelines, designed to improve the organization's operational performance and profitability.	Middle level managers must develop specific procedures, based on kaizen guidelines, designed to achieve cross-functional goals, communicate these procedures to workers, and conduct kaizen events within the organization.	Workers must continue to follow the kaizen guidelines' implementation process, participate in kaizen events, engage in continuous self-development to maximize their individual performance and ability to solve problems.
4.	Business owners and senior managers must strive to achieve their cross-functional goals and evaluate their company's performance on a continuous basis to ensure that they are on the right track.	Middle level managers must provide continuous training in kaizen-related activities to all workers within the organization and support small group activities, such as quality circles and individual suggestion systems.	Workers must continue to follow the kaizen guidelines' implementation process, strive to improve their individual skills and job performance through additional training.
5.	Business owners and senior managers must continue to develop new kaizen-based procedures and guidelines within the organization to maintain the overall business improvement processes.	Middle level managers must continue to provide workers with kaizen related training and conduct kaizen events within the organization on a continuous basis to ensure steady growth of the organization.	Workers must continue to follow the kaizen guidelines, actively participate in kaizen events, and strive to maximize their contribution in achieving overall organizational objectives.

7. KAIZEN AND TOTAL QUALITY CONTROL

KAIZEN AND TOTAL QUALITY CONTROL

The concept of Total Quality Control (TQC) is in many ways similar to the concept of Total Quality Management (TQM), discussed in detail in Tutorial 4.

Total quality control is an integral part of the kaizen culture and it has been one of the pillars of the Japanese approach to operations management for many years. According to Masaaki Imai, the TQC movement in Japan relates to all levels of management and deals with a number of important issues, as outlined below. (22)

TQC INVOLVEMENT IN A KAIZEN COMPANY

1.	Ensuring quality of products and services.
2.	Maintaining process, product and service cost reduction program.
3.	Meeting operational objectives and quotas.
4.	Meeting product and service delivery schedules.
5.	Ensuring overall safety in the workplace.
6.	Maintaining continuous product development.
7.	Ensuring productivity improvements.
8.	Maintaining effective supplier management process.

Total Quality Control (TQC) in a Kaizen Company relates to virtually all aspects of that company's activities as outlined below.

TOTAL QUALITY CONTROL APPLIES TO ALL ACTIVITIES IN KAIZEN COMPANY


General Management Activities	Human Resources Management Activities	Financial Management Activities	Operations Management Activities	Marketing And Sales Management Activities

THE PURPOSE OF TOTAL QUALITY CONTROL IN A KAIZEN COMPANY

The prime purpose of TQC in a Kaizen Company is to identify problems and to implement gradual solutions based on the kaizen culture and attitude of continuous and gradual improvement.

This is further clarified by the definition of Quality Control according to Japanese Industrial Standards:

"Quality control is a system of means to economically produce goods or services which satisfy customer requirements.

Implementing quality control effectively necessitates the cooperation of all people in the company, including top management, managers, supervisors, and workers in all areas of corporate activities such as market research and development, product planning, design, preparations for production, purchasing, vendor management, manufacturing, inspection, sales and after-sales services, as well as financial control, personnel administration, and training and education. Quality control carried out in this manner is called company-wide quality control or total quality control (TQC)." (23)

According to Mankichi Tateno, the former President of Japan Steel Works, three main goals of TQC are summarized below. (24)

THREE MAIN GOALS OF TOTAL QUALITY CONTROL

1.	To provide products and services which satisfy customer requirements and earn customers’ trust.
2.	To steer the corporation toward higher profitability through such measures as improved work procedures, fewer defects, lower costs, lower debt service, and more advantageous order filling.
3.	To help employees fulfill their potential for achieving the corporate goal, with particular emphasis on such areas as policy deployment and voluntary activities.

ADDITIONAL INFORMATION ONLINE

•	Total Quality Management By Flevy.
•	Total Quality Management By Efebovsmizraim.
•	Total Quality Management (TQM) By Accenture Academy.
•	Total Quality Management Part 1 By K.M. Ragsdell, MissouriSandTCourses.
•	Total Quality Management Part 2 By K.M. Ragsdell, MissouriSandTCourses.

8. JAPANESE VERSUS WESTERN APPROACH TO QUALITY CONTROL

JAPANESE AND WESTERN APPROACHES TO QUALITY CONTROL

Masaaki Imai states that there are certain differences between the Japanese and Western approaches to quality control, as outlined below. It is critical that you and your management team understand these differences and apply Japanese approach to quality control within your organization to ensure its long-term success. (25)

COMPARISON BETWEEN JAPANESE VERSUS
WESTERN APPROACH TO QUALITY CONTROL

Description	Japanese Approach To Quality Control	Western Approach To Quality Control
Relative Importance Of Quality And Profits	Quality comes before profits.	Quality comes after profits.
Overall Commitment to Quality	Company is committed to quality on a company-wide basis.	Company is committed to quality in the operations department.
Quality Control (QC) Manager	The job of QC manager is among the most prestigious positions which relates to all levels of management and to all employees on a company-wide basis.	The job of QC is technical by nature and relates primarily to the operations department. Position of QC manager ranks among middle management and does not have close contact with top management, unless it's in a small business.
Introduction Of Changes Related To Quality Control	Homogeneous composition of the work force makes it easier to introduce changes for improved productivity and quality control.	Heterogeneous composition of the work force makes it difficult to introduce changes for improved productivity and quality control.
Professional Knowledge About Quality Control	Professional knowledge related to quality control is available to all employees within a company.	Professional knowledge related to quality control is available to the technical and engineering personnel of a company.
Quality Training Programs	"Quality control starts with training and ends with training" (traditional Japanese expression). Training is offered to all employees on a company-wide basis.	Training is offered to specialized employees within the production or operations department only.
Small Groups Of Volunteers Engaged In Quality Control Improvements	Small groups of volunteer-employees engage in quality circles with an objective of improving quality on a company-wide basis.	The spirit of volunteerism does not exist in a typical company.
Organizations Involved In Promoting Quality Control	Several major organizations promote quality control. These include: Japan Management Association, Japan Standard Association, Central Japan Quality Control Association, Japan Productivity Center.	Very few organizations promote quality control. One of the major organizations is the Association for Operations Management, or APICS (formerly: American Production and Inventory Control Society).

9. TOTAL QUALITY CONTROL EMPHASIS ON MANAGING PROCESSES

TQC EMPHASIS ON MANAGING THE PREVIOUS PROCESS

According to Masaaki Imai, to achieve best results in Total Quality Control implementation, it is essential to evaluate all stages of a particular operational process from the very beginning to the end.

In a Kaizen Company, this entails managing the previous process, i.e. looking back to the previous process in the production or operations line, or evaluating preceding steps in any other area of company's activities whether it is purchasing, product design, or sales.

"THE 5 WHY?" METHOD

The 5 Why's Method - Root Cause Analysis is a practical method for identifying the real sources of a wide range of problems in various operational situations.

The 5 Why's method entails identifying a specific problem and examining the cause-and-effect relationships by asking "Why?" at least five times to determine the underlying reasons for the problem. Sakichi Toyoda developed the 5 Why's method and it became an integral part of the Toyota Production System (TPS).

An example of a 5 Why's method is presented below.

EXAMPLE OF "THE 5 WHY?" METHOD
(MANAGING THE PREVIOUS PROCESS)

Question		Answer
1.	Why did the machine produce a defective part?	Because the operator used the wrong tool.
2.	Why did the operator use the wrong tool?	Because the operator was not adequately trained.
3.	Why the operator was not adequately trained?	Because the training manager was not available.
4.	Why the training manager was not available?	Because the training manager was fired.
5.	Why was the training manager fired?	Because the company reduced the training budget.

As you can see, because the company reduced its training budget, the training manager was fired, the employee did not receive sufficient training, and subsequently he produced a defective part.

TQC EMPHASIS ON MANAGING THE NEXT PROCESS AS A CUSTOMER

According to Masaaki Imai, another key element of successful implementation of Total Quality Control in a Kaizen Company entails treating the next process as if it would be the customer.

One of the well-known Japanese Quality Gurus, Kaoru Ishikawa, came up with a unique idea that in order to maximize the level of quality of products and operations it is essential that each operator or worker, who is engaged in a specific production line, treats the next station as if it would be the real customer.

That means, that each worker is expected to make sure that no defective part will leave his or her station for the next station until the product or operation is fully checked in terms of quality and other essential parameters.

Thus, Ishikawa coined the well-known concept: "The Next Process Is The Customer".

This concept helped management and workers to understand that their customers are not only the real customers in the marketplace who buy their company's products, but also "internal customers", i.e. workers and operators in the next process who receive work-in-process from them.

This realization helped managers to develop a new approach to operations management which led to the famous Kanban system and Just-In-Time Methodology, discussed in detail in Tutorial 4. (26)

10. KAIZEN AND THE SUGGESTION SYSTEM

KAIZEN AND THE SUGGESTION SYSTEM

Masaaki Imai states that Employee's Participation in a Kaizen Company through a Suggestion System represents a major difference between the Japanese and Western approaches to business management.

In a typical Western Company the employees are not really encouraged to participate in the process of improving products, operations, processes, or services. They are simply expected to perform according to pre-determined parameters with a distinct objective to maximize the company's short-term profitability.

In a kaizen company, on the other hand, employees are strongly encouraged and constantly motivated to "think" and "observe" on an "overtime" basis regarding all work-related issues. Since this is an integral part of the Kaizen Culture, most Japanese companies benefited substantially from this positive work attitude.

The suggestion system in a kaizen company may function through individual suggestions by employees or through group suggestions by employees who participate in Quality Control (QC) Circles.

Irrespective of the method, it is the policy of the kaizen company to evaluate each suggestion received from employees and to decide whether it is suitable for implementation. Once a new suggestion is implemented within the kaizen company, it becomes the new working standard.

The kaizen company's management develops specific policy regarding the suggestion system, whereby employees, who come up with good ideas, are offered credit through special bonuses, awards, cash prizes, and recognition. The Suggestion System Policy represents, therefore, an essential and very useful part of the kaizen company. This policy provides important advantages, as outlined below.

ADVANTAGES OF A SUGGESTION SYSTEM

1.	Employees are motivated to think about their performance and work-related activities, and not just act like robots who must meet specific daily job objectives.
2.	The company receives a continuous list of suggestions related to various work activities.
3.	The company has a wider pool of ideas to implement new operational methods, products, services, and processes.
4.	The company has a better chance of improving its productivity, maximizing quality of products and services, reducing cost per unit of product or operation, minimizing waste, and consequently, improving the "bottom line."
5.	The level of morale among employees within the organization is enhanced through the recognition of those employees who provide a tangible contribution in the company's operational improvements and the opportunity offered to all employees to come up with new and good ideas.

WHAT IS SO SPECIAL ABOUT THE JAPANESE WORKERS?

In a recent interview, Toyota Motors Chairman Eiji Toyoda said:

"One of the features of the Japanese workers is that they use their brains as well as their hands. Our workers provide 1.5 million suggestions a year, and 95% of them are put to practical use. There is an almost tangible concern for improvement in the air at Toyota".

You do not have to be a company as large as Toyota Motors to be able to implement the Suggestion System within your business. In, fact, the smaller your company, the more effective you may be in implementing such a system, because the "red tape" will be much shorter too. Hence, the suggestion system may prove to be a good suggestion in itself for the future success of your company. (27)

ADDITIONAL INFORMATION ONLINE

•	Current Employee Suggestion System Not Working? By Les Landes.
•	Kaizen Vs. Suggestion Boxes By Mark Graban, Lean Entrerpise Institute.
•	Planning And Implementing Effective Staff Suggestion Systems By Flevy.
•	Suggestion System By Patrick Stipes And Debbie Bohannon, Personnel KY.
•	Employee Engagement Suggestion System By Stephanie Lozito, Industry Week.

11. PROCESS-ORIENTED VERSUS RESULT-ORIENTED MANAGEMENT

PROCESS-ORIENTED MANAGEMENT
VERSUS RESULT-ORIENTED MANAGEMENT

Masaaki Imai states that one of the main differences between a Kaizen Company and a Western Type Company is the issue of Process-Oriented Management versus Result-Oriented Management.

According to the Kaizen Culture and way of thinking, the process must be improved before the company may expect improved results. It's like saying that “the horse comes before the cart” - and this, of course, is the right way. In some U.S. companies, unfortunately, “the cart often comes before the horse”, and subsequently, these companies become less productive and lose money in the process.

Hence, according to Kaizen Guidelines, it is essential to evaluate a broad range of processes which relate to various organizational activities and to identify which processes are performed efficiently and which are not. Such evaluation should apply to all departments within the organization and should include all levels of the company's employees.

An example of such an evaluation in a small or medium-sized company is illustrated below.

PROCESS EVALUATION BY MANAGEMENT

1.	The company's president should identify and evaluate inefficient processes related to general management and human resources management.
2.	The financial manager should identify and evaluate inefficient processes related to financial management.
3.	Operations manager should identify and evaluate inefficient processes related to operations management.
4.	Marketing or sales manager should identify and evaluate inefficient processes related to marketing and sales management.

THE KAIZEN APPROACH TOWARD EMPLOYEES

According to Masaaki Imai, in the United States, generally speaking, no matter how hard a person works, lack of results will produce a poor personal rating and lower income or status.

Unfortunately, in most cases, the individual's contribution is valued only for its concrete results, namely: "What have you done for me lately (like... yesterday)?" Only the results count in the result-oriented organization.

The Kaizen Culture is designed to change this wrong notion and replace it with:

"What can we do together today to improve your results tomorrow?"

PROCESS-ORIENTED MANAGERS IN A KAIZEN COMPANY

According to Masaaki Imai, in a Western Result-Oriented Company, managers focus their attention on results based on "control with carrot and stick" in order to enhance performance and produce better results.

In a Kaizen Company, on the other hand, managers focus their attention on supportive attitudes toward subordinates, based on "support and stimulation" to improve individual and overall results in an effort to produce improvements.

This description of differences between the Kaizen and Western company is similar to two different leadership styles, i.e. Task-Oriented Leadership Style and Employee-Oriented Leadership Style discussed in detail in Tutorial 1.

Masaaki Imai suggests that a Process-Oriented Manager in a Kaizen company will be interested in several activities outlined below. (28).

PROCESS-ORIENTED MANAGER'S AREAS OF INTEREST

1.	Discipline of subordinates.
2.	Effective time management by subordinates.
3.	Skill development of subordinates.
4.	Participation and involvement in subordinates' activities.
5.	Maintaining high morale and motivation of subordinates.
6.	Ensuring effective two-way communication with subordinates.

12. CROSS-FUNCTIONAL MANAGEMENT AND TRAINING IN A KAIZEN COMPANY

CROSS-FUNCTIONAL MANAGEMENT AND TRAINING IN A KAIZEN COMPANY

Another important element of a Kaizen company relates to the Cross-Functional Management And Training Of Employees. Japanese managers understood a long time ago that high quality cannot be achieved only in the operations department.

High quality can only be achieved, if all departments within a company do whatever is necessary to maximize quality on an organization-wide basis. This, in turn, necessitates a Kaizen company to implement a continuous cross-functional training of managers and workers for a broad range of tasks.

Cross-Functional Training of managers and employees in a Kaizen Company represents an expanded version of an on-the job training through rotation in a typical Western company. By cross-functional training of its managers and employees, a Kaizen company achieves an important objective of enabling managers and workers to appreciate various elements of their company's activities, and creating more unity within the organization.

SIMILARITY BETWEEN CROSS-FUNCTIONAL TRAINING
AND THE LEAN BUSINESS ENGINEERING METHOD

The concept of Cross-Functional Training of managers in a Kaizen-driven company is completely in line with the basic premise of the Lean Business Engineering Method, discussed in detail in Tutorial 1. This method is based on a comprehensive and integrated approach to operational business management and it has a two-fold purpose:

1.	To provide small business owners and managers with a *comprehensive knowledge-based foundation* in all major areas of operational business management in order to maximize cross-functional management training efforts and produce superior results.
2.	To enable small business owners and managers to apply *cross-functional management training* to a pro-active evaluation and planning of their company’s operational activities and development of cost-effective solutions.

It is evident from many success stories, produced by Kaizen-driven companies, that the concept of cross-functional training of small business owners and managers makes a lot of business sense.

13. IMPLEMENT KAIZEN IN YOUR COMPANY

LEAN ORGANIZATION

Kaizen represents one of the basic building blocks for transforming any traditional business organization into a Lean Organization, as discussed in details in Tutorial 1.

Kaizen is effective in small, medium-sized and large manufacturing and non-manufacturing companies providing products and services to customers. For this reason kaizen will also apply to your company.

KAIZEN RESPONSIBILITIES

According to Masaaki Imai, kaizen applies to everybody in the organization, whether it is a one-person business, or it is a company with hundreds of employees. Obviously, everybody's role in the organization is different and each management level has specific "kaizen responsibilities":

• The CEO is responsible for developing the company's culture, values, vision, and strategic plan,    based on kaizen guidelines.
• Managers are responsible for developing and implementing the company's operational plans   designed to meet the company's objectives, in line with kaizen guidelines.
• All non-management employees are responsible to achieve their individual working objectives    in accordance with operational plans and kaizen guidelines.

IMPLEMENT KAIZEN ON TWO LEVELS WITHIN YOUR COMPANY


Level 1: Kaizen Maintenance		Level 2: Kaizen Improvement
This entails developing specific policies and rules designed to maintain current operational procedures and meet current work standards within your organization.		This entails introducing improvements to current operational procedures and work standards, designed to maximize the value-added activities and minimize waste within your organization.

The basic Kaizen Implementation Guidelines within your company are outlined below.

BASIC GUIDELINES FOR KAIZEN IMPLEMENTATION

1.	Adopt The Principle Of Continuous Improvement Everywhere. All employees are encouraged to adopt the principle of continuous improvement of everything and everywhere within the organization. Nobody should "rest on their laurels" and instead everybody should be open-minded toward finding better solutions in all areas of operational activities.
2.	Ensure Customer Satisfaction. All employees are encouraged to provide maximum effort in ensuring high level of customers' satisfaction on a continuous basis. Employees' performance and positive contribution in meeting and exceeding customers' expectations should be monitored and rewarded accordingly by management.
3.	Respect All Employees. All employees must be treated with utmost dignity and respect irrespective of their position within the organization. Business owners and managers should not dwell on blaming employees for past mistakes and instead should provide them with better training and instructions.
4.	Engage All Employees.. All employees are encouraged to get involved in the search for a better way of performing their job in the organization. Employees' positive contribution to improve operational activities and reduce waste should be monitored and rewarded accordingly by management. Teamwork should also be encouraged in the workplace, whenever appropriate.
5.	Improve All Operational Processes And Activities. All employees should look for additional ways of improving everything related to their work, including operational processes, procedures, methods, materials, tools, equipment, and communication.
6.	Maximize Value-Added Operational Activities. Each current value-added operational activity should be identified and evaluated. The management team must develop a plan to maximize all value-added operational activities within the organization, based on the company's future-state value stream map.
7.	Ensure Built-In Quality And Zero Defects. All operational activities must have a built-in quality control at each working stage to ensure that defective work-in-process is not carried forward and instead is stopped immediately after the defect is identified. This will enable management to ensure the highest level of product and service quality with zero defects.
8.	Minimize Non-Value-Added Operational Activities. Each current non-value-added operational activity (type 1 muda)* should be identified and evaluated. The management team must develop a plan to minimize all non-value-added operational activities within the organization, based on the company's future-state value stream map.
9.	Eliminate Waste. All current wasteful operational activities (type 2 muda, mura, and muri)* should be identified and eliminated, if possible, or minimized. This includes waste related to transportation, inventory, motion, waiting, overproduction, overprocessing, defects, underutilization of employees, and overspending. Every employee should be involved in identifying waste and rewarded accordingly.
10.	Implement Plan-Do-Check-Act (PDCA) Cycle. Managers are encouraged to apply the Plan-Do-Check-Act (PDCA) cycle guidelines to specific operational activities related to various products and services. The four stages in the PDCA cycle provide the basis for effective planning, implementation and performance control of all related operational activities within the organization.
11.	Implement Standardized Work. Managers are encouraged to develop and implement standardized work parameters and guidelines for various operational activities within the organization. This will be used as a benchmark for evaluating actual operational performance in various departments and comparing actual results with planned results specified in the standardized work parameters.
12.	Implement Kaizen Workshops. Selected employees are encouraged to participate in kaizen workshops designed to identify problems and inefficiencies related to specific operational activities within the organization and develop a set of cost-effective solutions to maximize the company's performance.

At this stage, you and your management team should be ready to proceed with implementing kaizen procedures within your organization. The first and probably one of the most important methods in the kaizen implementation process is the Plan-Do-Check-Act (PDCA) Cycle discussed next.

* Note:

Three Types Of Waste: Muda, Mura, And Muri are discussed in details in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Kaizen Keys For Continuous Improvement By Joe Boyle.
•	Creating A Continuous Improvement Culture By Karen Martin.
•	Kaizen Strategy For Continuous Improvement By Firecity Vijay.
•	The True Meaning Of Kaizen By Brad Schmidt, Gemba Academy.
•	Kaizen Improvement Process By Process Predictability Management, Inc.

14. IMPLEMENT THE PLAN-DO-CHECK-ACT (PDCA) CYCLE IN YOUR COMPANY

THE PLAN-DO-CHECK-ACT (PDCA) CYCLE

The Plan-Do-Check-Act (PDCA Or PDSA) Cycle represents an essential practical method for implementing kaizen guidelines in every business organization.

The PDCA Cycle is applicable to all operational activities within every organization, including general administration, human resources, finance and accounting, operations, marketing and sales. It was developed in the US by Walter A. Shewhart in 1930's, introduced in Japan by W. Edwards Deming in 1950's, and for this reason it is also known as the Deming Cycle.

The PDCA cycle consists of four basic steps described below.

Source: Wikimedia Commons, File: PDCA Cycle, 2008.

IMPLEMENT KAIZEN THROUGH PLAN-DO-CHECK-ACT (PDCA) CYCLE

1.	Plan. Define objectives (expected results) for improving a selected value stream, operational process or activity within your organization and prepare a detailed step-by-step plan for implementing this task.
2.	Do. Implement the step-by-step plan for improving the selected value stream, operational process or activity defined in Step 1 and evaluate actual results (measured results).
3.	Check Or Study. Compare the measured results specified in Step 2 with your expected results defined in Step 1 and summarize the difference (the variance). If the variance between measured and expected results in negligible and meets your expectations, you can proceed with Step 4. If the variance between measured and expected results is unacceptable to you, repeat Step 2 until measured results are acceptable.
4.	Act Or Adjust. Once you are satisfied that measured results specified in Step 2 are in line with expected results specified in Step 3, complete the implementation of the step-by-step plan for improving the selected value stream, operational process or activity defined in Step 1.

CRITICAL IMPORTANCE OF THE PLAN-DO-CHECK-ACT (PDCA) CYCLE

You and each member of your management team must understand the logic behind the PDCA Cycle to ensure effective operational performance, sound management control, and continuous improvement within your organization.

The PDCA cycle has unlimited applications in various operational activities throughout the organization and it is widely used during kaizen workshops discussed below. The PDCA cycle will enable you and your management team to plan, implement, check, and adjust any operational process or activity and improve operational efficiency.

The key element in the PDCA cycle is that each operational activity must be pre-planned first and the planned result (expected result) will be used as a benchmark for comparison with the actual result (measured result). Upon comparing actual results with planned results, you will be able to determine the performance variance and this, in turn, will provide you with a clear indication whether or not you achieved your specific objective. Subsequently, PDCA cycle will enable you to adjust and improve all operational activities within your organization in the most efficient manner.

ADDITIONAL INFORMATION ONLINE

•	Plan-Do-Check-Act Cycle By Rich Schuttler.
•	Plan-Do-Check-Act By Solutions 2 Work Stress.
•	The PDCA Cycle By IJ Aurora, And Glen Broomfield.
•	Plan-Do-Check-Act Cycle Explained By Gerold Keefer.
•	PDCA - Plan-D-Check-Act Cycle By EMS Consulting Group.

15. STANDARDIZED WORK IN A KAZEN COMPANY

WHAT IS STANDARDIZED WORK?

Standardized Work represents a critical management tool for every lean organization.

Standardized Work, also known as Standard Work or Standard Operation, provides a summary of working procedures and instructions related to various operational tasks and activities which can be documented, measured and repeated in any organization. Standardized work may apply to a broad range of operational activities, such as general administration, human resources, finance and accounting, operations, marketing and sales.

Standardized work can be viewed as a "things to do checklist" for any type of operational process or task in the organization and it contains detailed instructions for performing specific operational activities. The main purpose of standardized work is to establish a "work standard" which can be used as a benchmark for evaluating and subsequently improving Actual Work Performance.

The deviation of actual work performance results from standardized work requirements, called Performance Variance, can be used as a tool to measure work performance efficiency and enable management to develop and implement appropriate improvements in the workplace. Standardized work summary must include all essential details related to a specific operational process or task and remain flexible to accommodate future improvements, which may later become the "new work standard". Subsequently, this will provide continuity in improving various operational processes within the organization.

Development of Standardized Work Parameters provides several important advantages outlined below.

STANDARDIZED WORK ADVANTAGES

1.	Helps To Ensure High Level Of Product And Service Quality. This process helps the company to maintain high level of product and service quality and consistency in accordance with customer requirements.
2.	Provides Employees With Clear Operational Guidelines. This process provides employees with clear operational guidelines related to what they are supposed to do at work and how they are supposed to do it.
3.	Helps To Identify And Minimize Operational Waste. This process enables management to identify any wasteful activities and minimize non-value-added operational waste (type 2 muda, mura, and muri).
4.	Helps To Improve Operational Processes And Value Stream Efficiency. This process enables management to improve operational processes and maximize the value stream efficiency throughout the organization.
5.	Helps To Measure Employees' Work Performance. This process enables management to measure employees' work performance efficiency at and increase productivity and profitability within the organization.
6.	Helps To Determine Corrective Action When Necessary. This process enables management to determine corrective action, which may be necessary to improve efficiency, and identify additional employee training requirements.
7.	Helps To Minimize Costs And Maximize Customer Satisfaction This process enables management to minimize operational costs, offer best possible product and service value, and subsequently maximize customers' satisfaction.

Basic guidelines for establishing standardized work parameters are outlined below.

GUIDELINES FOR ESTABLISHING STANDARDIZED WORK PARAMETERS

1.	Standardize Working Activities To Maximize Employee Efficiency. Select an operational process, task or activity and define specific work that needs to be performed to ensure acceptable level of employee effectiveness. If the selected operation involves the use of equipment and tooling, the prime consideration should be given to the person and equipment should be secondary.
2.	Standardize All Repetitive Operational Tasks And Related Activities. Identify and standardize all repetitive operational process, tasks, or activities within your company. This will simplify your company's future-state value-stream map, maximize operational savings in labor, materials, and equipment costs, reduce the cycle time (actual operating time), reduce product or service costs, and maximize efficiency and productivity.
3.	Ensure That Equipment And Tools Are In Good Working Conditions. Identify all equipment and tools used in various operational activities within your company and prepare a status report outlining their current condition. Develop a plan of action designed to ensure that equipment and tools are maintained in good working conditions to meet your customers' future requirements in the most cost-effective manner.
4.	Develop Standardized Work Progress Reporting System. Identify and examine all relevant work progress reports related to your current operational activities and develop a standardized work progress reporting system for your future state value stream. Provide full training to employees to ensure efficient use of the new reporting system and make sure that this system is easily accessible.
5.	Review The Standardization Process On A Regular Basis. Review the standardization process related to various operational activities within your organization on a regular basis. Identify any possible inefficiency in selected operational activities and continue to introduce and document new improvements through kaizen events or workshops. Note: Kaizen events are discussed below.

Lean Management is discussed in detail in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Standard Work Series By Simplex Improvement.
•	What Is Standard Work? By EMS Consulting Group.
•	Standard Work Within Lean Organization By Gemba Academy.
•	Standard Work In Lean Services By Michael Balle, Business 901.
•	The Importance Of Standard Work In Lean Organization By S. Gilleland.

16. IMPLEMENT STANDARDIZED WORK IN YOUR COMPANY

STANDARDIZED WORK

Upon summarizing the details of standardized work, you and your management team will be ready to implement standardized work within your company. This process entails six steps as outlined next.

IMPLEMENT STANDARDIZED WORK IN YOUR COMPANY

Step 1: Check Equipment And Tools.

Identify equipment and tools which may be required for the implementation of standardized work and ensure that they are in acceptable working condition to meet specific operational requirements. Depending upon the nature of the company's activities, “equipment and tools“ may also include software programs, information systems, or anything else which may be instrumental in completing a specific operational process, task or activity.

Step 2: Check Cycle Time Versus Takt Time.

Identify the actual cycle time (actual operating time required to complete a unit of work), compare it with the takt time (the pace of production based on the rate of customer requirements), and determine the variance. Usually the actual cycle time is higher than takt time and it should be shortened to reduce the variance between both cycles in line with customer demand. Cycle time reduction can be achieved by analyzing current value stream, identifying opportunities for restructuring, streaming and implementing improved operational activities.

Step 3: Check Work-In-Process (WIP).

If applicable to the nature of standardized work, identify the range and level of work-in-process (WIP) inventory, considered as waste (muda), used in the current operational process. Determine acceptable minimum WIP range and level without causing shortages or bottlenecks in the operational process.

Step 4: Summarize Standardized Working Instructions.

Upon completion of Steps 1 - 3, summarize details of all requirements related to operational processes, tasks and activities, including equipment and tools, cycle time, takt time, work-in process inventory, into a suitable format and develop standardized work instructions. These instructions can be presented in a form of detailed instruction sheet or an operational manual, which summarize all pertinent information.

Step 5: Monitor Work Performance, Measure Results, And Measure Variance.

Monitor actual work performance related to various operational activities within your company on a continuous basis, compare actual performance results with expected results, based on standardized work parameters, and determine the deviation (variance) from the standardized work. Evaluate each work performance variance and determine the real reason behind it. Use the “5 Why” method, discussed below, for work performance variance analysis. Summarize all your findings and prepare work performance variance report. Make sure that appropriate manager and employee involved in the actual work are fully aware of specific performance variances and are ready to take corrective action.

Step 6: Adjust Work Performance Whenever Required.

Use work performance variance reports for making necessary operational adjustments and process improvement as often as possible. Actual process improvement requirements and solutions should be determined through kaizen events, discussed below. All managers and employees involved in the actual work should participate in these kaizen events and provide maximum input to improve relevant operational activities.

The next stage in improving operational performance within your organization entails conducting Kaizen Workshops which are discussed below.

Lean Management is discussed in detail in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Standardized Work By Jacob Isaac-Lowry.
•	Standard Work - Analysis By Systems 2 Win.
•	Standard Work Sheet Overview By Velaction Videos.
•	Operational Excellence - Lean Standardized Work By Frank G. Adler.
•	Why Use Standard Work In Your Lean Journey? By Shawna Gilleland.

17. CONDUCT KAIZEN EVENTS IN YOUR COMPANY

A KAIZEN EVENT

According to Kaizen Methodology, all operational processes within your organization must be identified, evaluated, and gradually improved to maximize your business performance.

Upon completion of the Current State Value Stream Mapping and establishing Standardized Work Parameters, you and your management team will be ready to begin improving operational activities within your organization. This process entails identifying specific operational problems, or customer complaints, which you may experience at present and selecting suitable work improvement projects designed to eliminate these problems through Kaizen Events, also known as Kaizen Workshops or Kaizen Blitz.

A typical kaizen event may run a day or several days, depending upon the scope and complexity of the kaizen project. This event should be planned well in advance and include all relevant managers and employees involved in the operational process or activities targeted for improvement. Although kaizen events require interruption of current operational activities and will cause some loss in production, they are usually well justified as a result of future operational improvements and savings.

Learn more about When And How To Use Kaizen Events?, written by Darren Dolcemascolo.

ADDITIONAL INFORMATION ONLINE

•	Kaizen And Kaizen Events By EMS Consulting Group.
•	Kaizen Tools For A Kaizen Event By Systems 2 Win.
•	Why Have Kaizen Events? By Joe Dager And Michael Balle.
•	Kaizen Blitz Versus Traditional Approach By Consulting With Impact.
•	Hosting A Kaizen Event By Sam Ellsworth, Arsenal Management Solutions.

KAIZEN AND GEMBA

According to Masaaki Imai, each manager must do Gemba, which in Japanese means "go to where all activities are taking place". It is critical therefore that you and each member of your management team spend some time in different departments and evaluate various operational activities in each department. You will find that some of these activities add value to your products or services, while other activities don't. Your job will be to identify all non-value-added activities, considered waste, and develop a kaizen project designed to eliminate or minimize waste in that department.

Gemba is closely related to 3 Gen Principles used in a lean organization which are presented below:

• Genchi - Go to the shop floor and observe the action (similar to gemba).
• Genbutsu or Gembutsu - Observe the actual product or service.
• Genjitsu - Gather the actual facts.

Lean Management is discussed in detail in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Gemba Glossary By Gemba Academy.
•	Morning Improvement Walk By Fast Cap.
•	Gemba Walk Questions By Tom Curtis, Fram Group.
•	What Is Gemba? By Jim Womak, Lean Sensei International.
•	Lean Gemba Walks By Jim Womack, Lean Enterprise Institute.

18. DEVELOP A KAIZEN PROJECT IN YOUR COMPANY

DEVELOP A KAIZEN PROJECT

You must also take your customers' specific requirements into account when developing a new Kaizen Project. There are three types of kaizen projects which could help you to improve the operational performance within your organization as outlined below.

THREE TYPES OF KAIZEN PROJECTS


Management Projects	Group Projects	Individual Projects
Management projects entail selecting management activities, which represent a current problem within your organization and need to be improved.	Group projects entail selecting team activities, which represent a current problem within a specific department and need to be improved.	Individual projects entail selecting an individual activity, which represents a current problem related to a specific work station or an employee within the organization and needs to be improved.

Kaizen Project Implementation is based on a PDCA cycle and entails four stages outlined below.

FOUR STAGES IN KAIZEN PROJECT IMPLEMENTATION

Stage 1: Plan.

Identify current operational process or activities within your company or department that need to be improved. Determine the real cause of existing problems by using a "5 Why" method, described below and develop best possible solution. Summarize all new steps that need to be completed in the future state value stream map (VSM) and specify improved results (expected results). Summarize additional personnel, materials, documentation, and other requirements.

Stage 2: Do.

Implement all planned steps, outlined in Stage 1 above, on a limited scale and on a trial basis. Engage all employees involved in the above process and make sure that your customers are not affected during the trial period.

Stage 3: Check.

Evaluate all operational results obtained during Stage 2 and summarize all related findings. If you are satisfied with the achieved results (measured results), you may proceed to Stage 4 with a full-scale operational process or activities improvement within your company or in the selected department. If you are not satisfied with results obtained during Stage 2, (because of excessive variance between expected and measured results) you must identify specific reasons and rectify them before proceeding to Stage 4.

Stage 4: Act.

Implement all planned steps outlined in Stage 1 above, or include updated corrections developed in Stage 3, monitor the entire operational process or activities and summarize all actual results (measured results). Hopefully, the performance variance will be on acceptable level, i.e. actual results will be in line with planned results (expected results) and this will signify that your company is on the right track.

A3 REPORT FOR KAIZEN PROJECTS

A3 Report represents a simple and practical tool frequently used by managers prior to conducting a kaizen projects. This report should be limited to one page and it contains information which relates to the selected problem in the organization. The A3 Report can be easily modified to meet specific operational requirements and one example of this report illustrated below.

Several essential Kaizen Implementation Methods designed to improve your company's operational performance are discussed next.

Lean Management is discussed in detail in Tutorial 1.

19. ESSENTIAL KAIZEN IMPLEMENTATION METHODS

ESSENTIAL KAIZEN IMPLEMENTATION METHODS


*The "5 S"* Method**	*The "5 Why's"* Method**	Kaikaku

A popular Kaizen Project Implementation Method, frequently used in eliminating waste and organizing the workplace, is "5 S" or 5 S Plus One". This method was developed by Hiroyuki Hirano as a part of his overall approach to production systems and it is particularly useful if kaizen project is conducted in a specific workplace for the first time. This method consists of five or six steps outlined below.

THE "5 S" METHOD (OR "5 S PLUS ONE")

1.	Sort Out (Seiri). The first step entails classifying all items in the workplace into "3 R" categories: • Retain - retain all items that are essential for effective functioning in the workplace. • Return - return all items that are not essential and belong to somebody else. • Rid - remove all items that are not required for effective functioning in the workplace.
2.	*Systemize (Seiton).* The second step entails arranging all work, tools, and materials in a specific order to create an efficient working system and operational flow in the workplace.
3.	*Scrub (Seiso).* The third step entails systematic "spring cleaning" of the workplace, equipment and tools to ensure clean working environment.
4.	Standardize (Seiketsu). The fourth step entails standardizing all operational procedures, tooling and equipment setup and maintenance requirements in the workplace.
5.	Sustain (Shitsuke). The fifth step entails ensuring continuous adherence to rules and procedures in the workplace.
6.	Safety (The 6th S). The sixth step entails evaluating the working area in terms of potential hazards and creating a safe environment for everybody involved in the workplace.

Kaizen Project Implementation entails not only selecting operational activities which present specific problems that must be resolved, but also getting to the root of these problems. The "5 Why's" Method described below is widely used in this process.

ADDITIONAL INFORMATION ONLINE

•	5 S Methodology By Lean MCO.
•	5 S Set In Order By ISI World.
•	5 S Overview By Gemba Academy.
•	5 S Factory Makeover Preview By 5 S Supply.
•	5 S Video Case Study By The Bilas Group LLC.

GET TO THE ROOT OF ANY PROBLEM WITH THE "5 WHY'S" METHOD

The "5 Why's" Method represents one of the most powerful, practical, and simple problem-solving techniques designed to get to the root of any problem in the shortest period of time. This method was developed by Sakichi Toyoda, described as the King of Japanese inventors, and it represents an important element of the Toyota Production System.

The "5 Why's" method can be used very effectively during a kaizen project implementation. This method will enable you and your management team to get to the root of your specific operational problems and determine an effective plan of action designed to eliminate these problems as quickly as possible. This method entails asking "Why?" at least five times, or more, depending upon a specific problem, by using reversed sequence. Here is a simple example of how this method works.

EXAMPLE OF THE "5 WHY'S" METHOD

1.	Why did our checks bounce last week? Because we were short of money in our checking account in the bank.
2.	Why were we short of money in our checking account in the bank? Because some of our clients did not pay their bills.
3.	Why some our clients did not pay their last bills? Because they were not happy with our service provided last month.
4.	Why some clients were not happy with our service provided last month? Because we used the wrong material during the service for our clients?
5.	Why did we use the wrong material during the service for our clients? Because our training manager did not provide correct training to our employees.

As you can see from this simple example, the lack of proper training of employees in the operations department created a problem with the checking account and caused a major embarrassment to the company's management as a result of bounced checks to suppliers. The subsequent solution to this problem will be to plan and implement a kaizen project designed to develop an improved training program for employees. This, in turn, will ensure the use of correct materials, improve the service value offered to customers, ensure higher level of customer satisfaction, motivate customers to pay their bills on time, and prevent any additional shortages in the company's checking account.

ADDITIONAL INFORMATION ONLINE

•	5 Why Presentation By ELSE, Inc.
•	Using The 5 Why Worksheet By Velaction Videos.
•	5 Why Root Cause Analysis By Six Sigma Money Belt.
•	5 Why Root Cause Analysis Problem Solving Tool By Velaction Videos.
•	Introduction To Root Cause Analysis By Denise Robitaille, Paton Professional.

IMPLEMENT MAJOR IMPROVEMENTS
WITH SUPERSIZED KAIZEN PROJECT OR KAIKAKU

Sometimes you may identify a very serious problem within your organization which may require a drastic change or complete overhaul in the existing operational process. In other instances, there may be a need to develop a brand new operational process for launching a new product or service line. In all these cases a simple kaizen project may not be enough and you will need to implement a super-sized kaizen project, called Kaikaku.

Kaikaku or "Breakthrough Kaizen", "Radical Kaizen" or "System Kaizen" means "reform", "major change", or "innovation" in Japanese. This method is effective when traditional kaizen, used for small and incremental changes and improvements, may not be sufficient. Kaikaku is used when significant or complete changes may be required in operational processes or activities. Similar to kaizen, this method also uses the PDCA cycle and it can be applied to all operational activities within any organization.

Kaikaku requires more preparation and planning time in comparison with a traditional Kaizen project. This method may often involve a purchase of expensive capital equipment or hiring additional personnel to meet new operational objectives. However, the main focus of kaikaku will remain the same - to maximize the value of products and services offered to customers, to maximize value-added operational activities, to eliminate or minimize non-value added operational activities, and to maximize the company's efficiency, productivity and profitability.

You and your management team should follow The Ten Commandments Of Kaikaku developed by Hiroyuki Hirano if you really want to introduce significant improvements and changes within your organization.

Lean Management is discussed in detail in Tutorial 1.

ADDITIONAL INFORMATION ONLINE

•	Perfection Series By Simplex Improvement.
•	Lean Through Equipment Kaikaku By John Dee.
•	Kaizen Or Kaikaku By Arne Ahlander, Aqqurite AB.
•	Kaizen Versus Kaikaku By Jeffrey K. Liker, G. Trachilis.
•	Kaikaku: Manufacturing Re-Imagined By Munro Associates.

20. PRACTICAL APPLICATIONS OF KAIZEN

PRACTICAL APPLICATION OF KAIZEN

Kaizen represents a unique culture which provided strong foundation for the successful performance of many Japanese companies.

Kaizen Culture has a broad range of practical applications within any organization, which were discussed earlier. Masaaki Imai's book The Key to Japan's Competitive Success, published by The McGraw-Hill Companies, Inc., certainly opened the minds of many Western managers, who are eager to improve the performance of their organizations.

If you really care about succeeding in business through continuous improvement, you should obtain and study KAIZEN, The Key to Japan's Competitive Success, by Masaaki Imai, as soon as possible. This will help you and your management team to become more effective in the process of accomplishing a broad range of tasks in accordance with the world class manufacturing and operational guidelines.

ADDITIONAL INFORMATION ONLINE

You can obtain additional information about kaizen online:

• KAIZEN Institute, Ltd.®
• Kaizen Training Limited
• Lean Enterprise Institute

21. FOR SERIOUS BUSINESS OWNERS ONLY

ARE YOU SERIOUS ABOUT YOUR BUSINESS TODAY?

Reprinted with permission.

22. THE LATEST INFORMATION ONLINE

LESSON FOR TODAY:
Kaizen Is The Best Japanese Prescription For Success!

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