Think about your daily life, whether that's work, school, home, or your social life. Are there any aspects of your life that can be improved? While you may be content with how your life is going, there are always opportunities for betterment.
The same is true for an organization. Even if operations are running smoothly, there are always improvement opportunities. That’s why leaders apply continuous improvement, or kaizen, to their businesses.
Keep reading as we illustrate how continuous improvement can cut costs and boost efficiency.
Continuous improvement in business refers to the gradual improvement of systems, processes, and products over time. Known as kaizen, the combination of “improvement” and “good” in Japanese, continuous improvement takes a philosophy for life and applies it to business. The continuous improvement process suggests that if we make small, incremental improvements over time, these small improvements can lead to major changes in the long run.
The kaizen process was popularized in the 1950s after World War II by Japanese manufacturers. The goal of kaizen is to continually improve processes so that any waste is eliminated. In this context, waste refers to any inefficient use of time or redundancy in processes.
A famous example of the continuous improvement model is the Toyota manufacturing model, which focuses on making only “what is needed, when it is needed, and in the amount needed.” Since then, it has been applied to many businesses, even outside manufacturing.비즈니스 프로세스 관리 템플릿 만들기
The goal of the continuous improvement process is to optimize for activities that generate value for customers while getting rid of any inefficiencies. Common in lean methodology, there are three types of waste that the continuous improvement process aims to eliminate: Muda, Mura, and Muri.
The Japanese word muda translates to “wastefulness” or “uselessness.” In regards to the continuous improvement process, these types of waste prevent certain work processes from reaching operational excellence.
There are two types of muda waste:
Type 1: Processes that don't add value to customers, but are still necessary for the end customer. Take safety inspections for example. While they don’t directly add value to the final product, they are necessary and crucial for ensuring a safe product.
Type 2: Processes that don't add value to customers and are not necessary for the end customer. These are often internal processes, such as documentation. These are processes that the kaizen method aims to reduce.
There are seven categories of waste that fall under muda Type 2. Those are:
Transport: excessive movement of product
Inventory: excessive goods and raw materials
Motion: excess movement of machines or people
Waiting: idle time between one step to the next
Overproduction: producing too much of a product
Overprocessing: adding too much to a product that doesn't provide value
Defects: producing unusable products
Mura means “unevenness” or “irregularity.” To prevent mura from occurring, the goal is to have a balanced and streamlined process so that no one stage has a bottleneck.
An assembly line is a simple example of mura. If one section of the assembly line is backed up, the team may produce too little or too much of a specific product to compensate for the bottleneck.
The Japanese word muri means “overburdened” or “beyond one's power.” In terms of workload, muri indicates an unreasonable amount of work. Muri can also cause damage to machinery, leading to costly repairs. In terms of employees, muri can result in absenteeism, illness, and burnout.
There are different strategies for how to create a culture of continuous improvement. Here are a few common ones.
There are four main steps of the PDCA cycle:
Plan: Identify the main goal of this project and how you will measure success.
Do: Test out your plan to achieve the goal.
Check: Review the actions from the Do phase. Are things improving?
Act: Roll changes out to the full project, or if the test in the Do phase didn't work, make small changes until it does.
The framework is used to approach and resolve project management and process improvement problems. Because of the cyclical nature of this methodology, it's an easy way to continually implement changes
Best for: Organizations looking for a continuous improvement cycle that can be tweaked as the company grows and changes. PDCA lays a foundation for continuous improvement that you can adjust as needed.
Six Sigma is a process improvement methodology often used in manufacturing. Six Sigma works by minimizing variability during the manufacturing process. This is achieved through rigorous quality assurance assessments.
There are two main methodologies in Six Sigma: Define, Measure, Analyze, Improve, and Control (DMAIC) and Define, Measure, Analyze, Design, and Verify (DMADV).
DMAIC has five phases:
Define the system.
Measure key aspects of the current process and collect data.
Analyze the data to verify cause and effect.
Improve or optimize the current process based on data.
Control the process from deviations in the future.
While DMAIC relates to the overall process, DMADV refers specifically to the product design process. However, both work to improve upon a current system.
Best for: Organizations, especially manufacturers, looking to improve upon an existing system or product. When applied, Six Sigma should help build and retain customer loyalty and retention.Read: Six Sigma: Everything you need to know about this process improvement methodology비즈니스 프로세스 관리 템플릿 만들기
Agile is a project management framework that breaks down projects into smaller phases, or “sprints.” Some forms of Agile are iterative, which allows for a culture of continuous improvement. In Agile, team members reflect back during every sprint cycle to reflect on what small changes could be made for the next sprint.
Best for: Teams looking for an adaptable system that focuses heavily on customer needs. Agile can also help create the most accurate costs and timelines for clients and stakeholders.참고: 워터폴, 애자일, 칸반, 스크럼의 차이점
Root cause analysis helps organizations understand the source of a problem in their process and find the best solution.
This is commonly done through a method called “The 5 Whys,” where you define a problem and then break it down bit by bit. For example, if you were dealing with unhappy clients, the process may look like this:
The problem: Clients are unhappy
First why: Why are clients unhappy? Because we’re late on deliverables.
Second why: Why are we late on deliverables? Because projects are taking longer than expected.
Third why: Why are projects taking longer than expected? Because we underestimated the complexity of certain projects.
Fourth why: Why did we underestimate the complexity of certain projects? Because we didn’t look at the stages ahead of time.
Fifth why: Why didn’t we look at the stages ahead of time? Because we didn’t have enough time.
Root cause: Employees don’t have enough bandwidth to complete projects in a timely manner.
Best for: Organizations with persisting issues. If you find the same problems are repeating themselves, dive into root cause analysis to get to the source.
Kanban, the combination of the Japanese words for “sign” and “board,” is a methodology designed to help teams balance work and capacity. The Kanban framework relies heavily on a philosophy of continuous improvement, by allowing work to be dynamically adjusted based on team bandwidth.
Developed by Taiichi Ochno, a Toyota engineer, in the late 1940s, the method involves creating a backlog of tasks and allowing employees to pull from it based on their bandwidth. From there, each task is tracked through stages, which are visualized on a Kanban board.
A work management tool can help organizations create virtual Kanban boards, so entire teams can easily check in on the status of a project.
Best for: Teams looking for a more structured way to communicate and move tasks from start to finish. Kanban is great for teams that have the flexibility to pick up and knock out simple tasks as they arise.
If your team hasn’t adopted a continuous improvement model, rolling out new processes can take some time. Here are a few tips for implementing this idea in your company.
The goal of continuous improvement itself is to make small, incremental changes. Start working with a small portion of team members to see how any changes work. If it goes well, begin to test it out with more teams. This implementation process itself is the practice of kaizen.
Continuous improvement works especially well when individuals are encouraged by senior leaders. Prepare your leadership team by offering special training to encourage new ideas and removing any blockers that may be in a team member's path as they are trying to improve a workflow.
One of the hardest parts of using the continuous improvement model is the desire to strive toward perfection. This is an impossible feat, and the philosophy behind kaizen is to make small changes to be better than you were the day before. Focusing on perfection can lead your team to make changes that aren’t actually necessary.
Encourage continuous feedback throughout to make sure your team is responding to the changes. The PDCA model makes this simple by incorporating feedback directly into the Check phase of the process. If you’re using a different model, be sure to incorporate a feedback phase.
Think about why you incorporated a continuous improvement model. Was it to cut costs? Increase productivity? Improve quality?
Whatever it may be, make sure it’s trackable. Find the metrics that best illustrate the impact of the initiative and present the evidence to team members and stakeholders.
Continuous improvement can result in both operational and cultural advantages. Below are some of the most common and immediate benefits.
In continuous improvement, changes are easy to make. The idea with continuous improvement is that you make small changes and test to see if they work. If they don't, then your workflow isn't disrupted by making that small change.
A good example of this would be for a change in an assembly line. The team can test out switching two steps that are not dependent on one another and see if that changes the speed of the production flow. If the production speed is slower, the team can easily revert back to the original process without changing the entire process.
Continuous improvement empowers every team member to take ownership of their processes. Kaizen is best operated throughout the entire organization and engrained within the company culture. If something is not working for a team member, they can take ownership to make the changes needed to optimize their individual workflow and minimizelimiting beliefs.
A given process can work for a group of team members, but what happens when you add people to the team? The original workflow might not work as well as it used to, but kaizen allows for teams to shift these processes in changing environments.
A good example here would be scaling workflows from a small team to a larger team. A team might start tracking certain information in a spreadsheet when they’re only a team of two or three. But what happens when that team grows to a team of 20? That amount of people working in a spreadsheet can become unmanageable.
The kaizen process allows for the team to experiment with the information workflow that works best for them as they continually grow.
When your company culture encourages team members to improve business processes in a way that works best for them, it encourages more discovery and curiosity within the entire company. This enables individuals to experiment without the fear of breaking processes or being judged for failure. If something doesn't work, things can just revert back to what they were previously.
Improvement opportunities aren’t always abundantly clear. Sometimes, you have to dig deep into your processes to find what needs to be upgraded. Using a structured approach like continuous improvement reveals possibilities for improvement and gives you the tools to reach your goals.