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The PEOPLE Factor

THE PEOPLE FACTOR

In the issue of Mission Dantotsu, we discussed THE LEADERSHIP FACTOR. To recall, let me quote from there:

“Here are our conclusions about the hierarchy of factors that drive excellence in an organization:

  1. The single most important factor – the Conductors of the Orchestra – Leadership Factor
  2. The second most important factor – People Factor
  3. The third most important factor – Innovation Factor!”

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I would like to take this opportunity to highlight the importance of the ‘People factor’ to any organization that aspires to be ‘excellent’.

A few years back Toyota made ‘respect for people’ one of the pillars of ‘The Toyota Way’.  Some companies thought they already practice this concept, and many others just incorporated these words into their ‘models’. Unfortunately, the reality on the gemba is stark!! A vast majority of the organizations that we observe as part of our profession, very nearly disregard the people element. Most confine their ‘HR (read ‘people’) policies’ to supervisors, executives & managers! The rest are handled through IR!!!

There are many reasons for this. Lower costs & relative abundance of unskilled labor; labor laws governing ‘permanent employees’ & ‘contract labor’; the approach of some of the trade unions & vastly varying interpretation of the phrase ‘respect for people’ – drive anti people policies.

The paradox is that these very same organizations want to implement Lean, they want to implement Kaizen® & they want to be operationally excellent! Somehow, we – the Kaizen®/ Lean promotion community, has not been effective in bringing home the unambiguous message that ‘respect for people’ is an essential pre-requisite for Operational Excellence. Without that, it may be possible to get some performance improvement, but it would be impossible to sustain those improvements & to build a Kaizen® culture suitable for long term success in this rapidly changing world.

What is the meaning of the phrase ‘respect for people’? How does it manifest itself from being a fuzzy/ hazy concept to actual practice? For an answer, I would like to share two quotes.

The first one is from Mr. Akio Toyoda, President Toyota Motor Corporation’:

‘At Toyota, we have always invested heavily in developing leaders who understand and live the principles & values of the company. We want our DNA to be encoded in every team member at every level of the company. We expect greatness from all our people. We expect them to accept and conquer challenges that may seem overwhelming at first glance.

A real irony is that ‘respect for people’ requires that people feel the pain of critical feedback. If we do not give people accurate feedback based on real behavior they are not growing and we are not respecting them. The job of a leader is not to put them in positions to fail, but to put them in challenging positions where they must work hard to succeed and still see how they could have been even better. Our goal is for every Toyota team member from the worker on the production floor to our most senior executives to be working to continuously improve themselves.’

The second is attributed to Mr. Konosuke Matsushita, the founder of Matsushita Electric, which gave birth to iconic brands like Panasonic:

‘We build people, our people build products’.

Could leaders in our part of the world also build examples of excellent organizations supported by a strong PEOPLE FACTOR? We would certainly hope so.

by Mr.Vinod Grover (Director – KAIZEN Institute India/Africa/Middle East)

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Do more with less

Organizations are always looking at ways to “do more with less.”

It is often taken as to work harder and getting paid less. But it doesn’t have to be this way.  If we have a plan – a strategy we can “do more with less.” But the fact is most organizations do have a plan but when it comes to implementation they are struggling day in and day out to get the work done or implement what has been planned. We are always entangled by asking questions like How much waste does our organization produce? Many a times we have to wait for someone else to finish a task before we can get on with our own work. Do we have a large inventory of unsold stock? Do we have more workstations than we need? Or do we order materials months in advance of when they are needed? How about flexibility? If consumers want a modification / change to our product, can we quickly change our processes to meet their needs? Do we have frequent over time?

All these questions cost money to us and our customer. And if our customers have to pay more because of it, they might go elsewhere. So, how can we get answers to such questions and how can we do things more efficiently?

Many think “Add more machines or add more people or add materials, etc.???

But this is a non-kaizen thinking. Time has come to think about transforming them into organizations where people think KAIZEN (produce more with available resources). Leaders who are looking to truly do more with less has to adopt a company-wide KAIZEN mission.

KAIZEN approach challenges the individual to make continuous improvement daily no matter how small. Imagine if all employees start making small improvements daily, the impact could be tremendous. The change has to be an improvement that somehow translates to an increase in efficiency. But if we look at the flip side of the coin – the cost of implementing KAIZEN is not free. Employees have to be trained, provided some time to think & implement, etc. Continuous improvement cannot be done in an environment where employees do not have time to review their performance to identify improvement opportunities. Employees will have to understand the difference between being busy and being productive. They have to learn the art of identifying non-value adding activities. They will have to identify elements of production that add time, effort, cost, but no value. KAIZEN approach helps the organization or employees to identify the 3 killer virus i.e. Muda (Waste), Mura (inconsistencies or variation) and Muri (Strain).

Muda is classically seen in eight forms:–

  1. unnecessary material transportation,
  2. unnecessary motion of people… hands, feet, eyes!
  3. rework/ inspection due to defects,
  4. people, material or machines waiting for each other
  5. unnecessary processing – over kill!
  6. unnecessary production – producing more or faster than required
  7. unnecessary inventory – in any form raw, work in progress or finished goods
  8. finally the killer – unused human skills/ potential

Mura means Variation/inconsistency. Variation means deviation from a set standard or expected outcome. Mura – Variation from expectations is a rampant virus, inflicting all processes and work activities. Variation results in waste in the form of scrap, reworking or reprocessing. Coming to business, there is variation in business processes, products, materials, skills, output etc. Inspite of advancements in machines and in process technology, variation do occur and it is the management’s duty to IDENTIFY, MEASURE, ELIMINATE and keep out all variation from the processes.

Muri means avoidable physical strain/ burden on people and machines/ equipments at work. Same strain (within defined & safe limits) is to be expected at work, but when the strain becomes excessive, it becomes a burden It results in accidents, injury, leading to poor output or quality errors. A person, who in working in extreme conditions caused due to excess noise, temperature, fumes, etc, experiences Muri / burden.

The 3 MU’s are observable and comprehensible by all because everyone lives with it. Most of the time that is what people complaint about! That is what creates obstruction and people are not able to their work productively. There is a need to train our teams to identify the 3 MU’s, to show them that the largest productivity and profits are obtained by driving out these 3 MU’s only. If this is taken care of we can actually “do more with less.”

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Make actions to regularly identify, reduce and eliminate the 3 MU’s from our GEMBA. This is the key to success or for doing more with less.

So KAIZEN is the answer for “do more with less”.

Sample checklist: Below given are the sample checklist which can help an organization while on the journey of KAIZEN.

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KAIZEN: A major driver of Change

Today’s competitive and ever changing market environment demands the continuous optimisation of customer requirements, production changes, delivery capacity, flexibility and, ultimately, profitability. The Kaizen methodology has found its way in numerous manufacturing industries striving towards operational excellence.  

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It is important to understand the word KAIZEN. Although Kaizen is defined in English as “Continual Improvement”, it is much more than the word signifies. Kaizen is a way of life, an attitude, a spirit, daily process that prevails at all times in an organization. It is said by Sensei Masaaki Imai that Kaizen should be practiced by “Everyone (all employees, managers included), Everyday (not like a month end sales promotion…..but a way of life) and Everywhere (all departments – not restricted to the shop floor). Kaizen approach has helped countless businesses around the world. (Both in manufacturing and services)  The Kaizen approach helps turning people into problem solvers, thus taking advantage of that which is free–the mind.  This approach focuses on developing a culture where workers are trained to become problem solvers, where they learn to constantly look for ways to improve the company.  The Kaizen philosophy focuses on a low cost form to implement a competitive advantage rather than a high cost, big time innovative change that might, or might not work.  It is based on constant, gradual improvement, rather than quick, big time improvements.

Gap Exists in all areas of Operational performance. For e.g.; An automotive industry analysis shows that:

  1. Manufacturing: 80% time on non-value added activities
  2. Supply chain: Too much inventory (140 days vs. 35 for best-practice*)
  3. Channel Management: Poor channel capability and returns
  4. Key account management: No systematic tracking of top customers and their satisfaction
  5. Pricing: Unaware of ‘pocket margins’
  6. Purchasing/supply management: Too many suppliers (250* vs. 100 for best-practice)

Therefore what is required to drive operational excellence is an agenda driver by the CEO, focus on facts & root causes, relentless focus on change management and programmes led by brightest & the best.

KAIZEN aims at improving total business performance through sustainable implementation, it can be via:

GEMBA KAIZEN workshops

  • It is a ‘learning by doing’ tool to internalize the concepts applied in bringing about the improvements.
  • It creates a drastic reduction in the time elapsed between a need for improvement and implementing the improvement.
  • A five-day structured event in which teams from within the client organization work on pre-selected improvement projects, on the workplace, facilitated and supported by experts from Kaizen Institute

Training

Training teaches in a practice related way how improvement processes in different areas can be triggered and sustained.

Benchmarking

Visit world class manufacturing facilities and experience the Best Practice Live through Excellence inside Tours. Learn Through Real Time Observation of successful JIT and other KAIZEN Practices in a variety of industry to provide you understanding of next steps to design Kaizen implementation process of your organization.

Qualification

Theory and practice go hand in hand and organizations have understood the importance of certifications and therefore have started offering various programs to their employees relevant to their industry or requirement in association with certification providers.

Advantages of implementing KAIZEN:

–          All functions of the organization come under continuous inspection. 

–          Employees most familiar with a particular operation on a day-to-day basis are the ones evaluating it. 

–          It serves to increase employee morale and job satisfaction. 

–          Waste is identified & reduced throughout the organization, reducing costs and increasing efficiency. 

–          Product or Service quality is improved and is monitored on a continuous basis. 

–          Improved productivity, quality, better safety, faster delivery, reduced costs and greater customer satisfaction.

The ultimate goal to transform a traditional companies into a lean company is to obtain a culture of continuous improvement. The moment you stop focusing on Kaizen, results will disappear within months. Sensei Imai believes top management should never stop focusing on kaizen and on gemba.


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What does KAIZEN mean to you and your business?

The world hates change, yet it is the only thing that brings progress – Charles F. Kettering

Yes, change for the better brings progress! KAIZEN®, as we all know,  is a structured, scientific, guided and controlled process to bring about beneficial change! KAIZEN®® is not improvement by chance, it is improvement by design.

As competitive pressures mount, KAIZEN® no longer remains merely a ‘good to practice’ activity, it becomes an essential survival strategy. Yet, it is a voluntary initiative – because survival is not mandatory!

So what does KAIZEN® mean to you and your business? Organizations that have changed their existing paradigm have improved and seen progress. The only thing that needs to be kept in mind is what you or your organization are doing today can be done more efficiently, with a better quality, more cheaply and in a way that is considered valuable by your customers. Organizations have to Identify, Eliminate & Reduce Muda (Waste), Mura (Variation) and Muri (Strain) from their processes, life or routine work but this is possible only if you are ready to change the existing belief. KAIZEN® can actually encourage leaders to abandon the existing paradigm.

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KAIZEN® is a journey where you celebrate problems – Journey from effect to cause or from tools to transformation or seeing to believing. KAIZEN® is improving with available resources.  Opportunities for KAIZEN® are unlimited if you look around, for e.g. bending down to lift an object or to try to reach up high for something which is not reachable, unnecessary movements of machine or employees, etc. The objective of KAIZEN® should be to avoid all unnecessary wasteful movements or strain on men or machine or material but the truth is nobody is bothered to change or is not willing to change the existing set of practices. Organizations or employees think that KAIZEN® is suitable only for manufacturing or KAIZEN® only talks about changing old processes or machines or technology that has been used since years or it is a method of taking out more or demanding more from employees without getting paid for it.

But the fact still remains fact i.e. KAIZEN® is a philosophy which inspires or motivates the whole organization with the instinct for continual improvement. Employees participate not for any particular financial reward, although these may be a part of the recognition process, but for the satisfaction of using their skills to improve the operations they perform and the good & services they produce. 

KAIZEN® incorporates a variety of techniques and principles into the overall culture and philosophy of improvement–improvement as a way of life, rather than just the application of isolated techniques.

 Roadmap for implementation of KAIZEN® or Action Checklist

  1. Develop an understanding of the process or build the belief
  2. Identify corporate objective in order to align it with KAIZEN® objectives
  3. Analyze current state and design the KAIZEN® roadmap
  4. Allocate the resources
  5. Train the required staff
  6. Communicate with the employees
  7. Implement the roadmap
  8. Set standards
  9. Deploy Daily Work Management techniques

Contributed by:

Mr.Vinod Grover & Divyakumar M Soneji


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Kaizen in a time of Crisis

Tough time builds Tough Organizations

Last few months have been rather unusual times for the economy – at least for the people of this generation! The impact has been rather wide spread – in sectors and in geographies.

It is tough times like these that test the spirit of organizations. Globally, there are some well-known names that have fallen by the wayside – wiped out! New ones keep joining them periodically. The best of them have shown unprecedented downturn in results (example-Toyota).

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It is important to know and understand how leaders in both situations organize teams, motivate them and build trust among their individual team members. Many organizations have started reviewing their current state of practices in terms of quality assurance, cost management & delivery systems. Equally, increasing competition has made it a priority for every organization to develop and seek an advantage over rivals. A culture of continuous evaluation and improvement is seen by many organizations as an essential tool to achieve and maintain an advantage. Kaizen is one of the main tools to develop such a culture while gaining an understanding of the value of using a Kaizen approach to leadership in order to promote an atmosphere of continuous improvement and open communication. The research examines how successful leaders in both business and sailing monitor and react to the external environment, consistently working to manage risk, in order to maintain a sustainable competitive advantage in both good times during crisis. The research has shown that while there is no one set of skills that allows a leader success, instead a group of skills and attributes that need to be practiced and honed and applied to each individual situation.

What happens in the external environment is not in our control. What we do within our organizations is in our control. We can use this time to strengthen our systems, drive out waste, increase employee skills, and make our organizations lean, fit and robust. This will prepare us for the inevitable rebound/upturn.

It was just one such tough period after the Second World War that resulted in the Toyota Production System!!

Here is wishing all readers & leaders wisdom to seize opportunities and a healthy dose of Kaizen® to tide over the tough Global environment!!


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The Bell

The bell was ringing for the 7th time when the king was about to sign a trade treaty with his neighborhood kingdom. The bell had been continuously interrupting, each time the bell rang the king had to stop the discussion. Actually the bell was installed by the first king of the country as a token of gratitude to the people who had chosen him. The purpose was any grieving people can ring the bell and the king would attend at any cost, day or night.

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At that time the population was thin and this method worked well. But then the kingdom expanded and the population multiplied, this continual tradition was a real menace for the current king to think, eat or sleep peacefully. So the king discussed with the advisor who was his childhood tutor about removing the bells. But the advisor was not in favor of losing the selfless service of the king to the people. However, the king thought by attending every subject’s grief, which was almost trivial, he was not able to commit to other needful improvements. So he decided to divide his kingdom into 10 provinces and to choose 11 wise men to attend their grievances.

The chosen 11 men were taught the laws of the kingdom by the advisor. The king took the 11 men along with him every time the bell rang. So they got a firsthand knowledge of dealing with problems. Wisest of the 11 was chosen to be the chief counselor and the remaining 10 were placed in charge of the ten provinces.

At the beginning of every week the 10 province heads assembled in the palace headed by the chief counselor and discussed the issues they were not able to resolve. And the chief counselor discussed the unresolved issues with the king and the advisor. At first the people were unhappy due to the denial of direct access to the king. Soon they realized that the 10 men were solving their problems just as the king would. Besides, they didn’t have to travel all the way to the palace for resolving their grievances. Finally, the bell was removed. The king could now focus on other important issues. He could also think, eat and sleep peacefully.

Moral of the Story:

1. It is not always necessary to follow the old traditions. Be innovative!

2. A leader should prioritize his time over small and big issues

3. A leader should not be a corporate dictator. He should appreciate Empowerment.

4. Empowerment of employees requires appropriate training and providing them with resources

5. Employees should be accountable for their results

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KAIZEN makes it possible, Employees make it happen

Organizations strive for continuous improvement out of respect for people, but it is that basic respect for people that helps make continuous improvement possible.

If an organization is seeking sustained continuous improvement it has to ensure each leader and each participant practices respect for people. People should be kept engaged, respected and valued irrespective or their designation or title or department. Engaged employees are more productive, loyal, more creative, and deliver better service to customers.  Improving employee engagement acts as an essential part of an organizations drive for Operational Excellence. But one point has to be kept in mind, Engaged employees do not necessarily mean Satisfied employee. It may differ from satisfied employees where the emphasis is on what the company pays, working conditions, benefits packages, etc. Actively engaged employees need not be fully satisfied and vice versa.

Lack of skills, De-motivation, Unclear goals/targets, Lack of transparency, Poor/Inconsistent culture, Ignoring people aspect, Unclear roles and responsibilities are few of the example that sabotage excellence.

ImageEmployees often think:

Do We Know How To Do The Work? (skills/competencies)

Solution: Train for doing current task. Plan long term competency development. Mentoring/Coaching.

Do We Feel Like Doing The Work? (Motivation)

Solution: Formal performance management. Compensation is at par with work done. Rewards & Recognition.  

Would We Like To Do It Together? (teamwork)

Solution: Top down communication. Bottom up communication (grievances, issues, opinions). Lateral co-ordination. Team work. Delegation of authority.

Are We Moving In The Desired Direction? (Workforce alignment)

Solution: Resource management. Long term workforce planning.

It has been observed that a major challenge faced by organizations is how to implement best practices to ensure that organization obtains the maximum return on investment from its staff and gets the job done, while at the same time providing job satisfaction, career development pathways and engagement opportunity for various projects.

The work culture of an organization may often affect the levels of discipline, creativity, decision making, etc of its staff. How can an organization ensure that its employees understand and then focus on the right issues? How can the concept of CHANGE for BETTER be instilled in the core behaviour of an employee?

Points to be kept in mind!!

  1. Improve your on boarding process
  2. Delegate responsibility
  3. Be open: provide the tools and opportunity
  4. Train a core group of middle managers or above in problem solving and improvement coaching
  5. Gemba Kaizen Workshops to be done on regular basis to instil new behaviours & shift culture
  6. Lead by example
  7. Make improvement part of everyone’s job
  8. Never do process improvement without the involvement of the people who actually do the work
  9. Advocate the truth that people aren’t the problem – systems are
  10. Praise & recognition