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Creating A Lean Business - The Kaizen Diet

In today’s world, we are constantly being bombarded with stories about the epidemic of obesity. But individuals aren’t the only ones who are overweight. Most businesses in Canada aren’t lean either. Many suffer from obesity, and obesity can kill. They desperately need to go on a diet.

Manufacturing businesses subject to global competition are learning this the hard way. And now the message is abundantly clear for non-manufacturing businesses such as those in hospitality, service and software industries: Diet now or suffer.

But what is the best diet for business? Should you starve your future by not spending today? Do you eliminate necessary resources to cut costs? Or do you eliminate the waste in your current processes? If you choose to take the third approach, putting your business on a Kaizen Diet is the way to go.

The Kaizen Diet
From kai, Japanese for to change or break apart, and zen, for study or make better, the term Kaizen means improvement. The application of Kaizen means continuous improvement, and when applied to the business environment, it refers to on going efforts on the part of everyone at a company to continually improve all aspects of the business.

Kaizen was originally created as a tool to foster continuous improvement within the Toyota production system. It began as “Quality Circles,” a means of having factory shop floor employees solve quality issues within a structured team framework while using new analytical tools. Today, in diverse businesses and industries all over the world, “Kaizen events” are constantly occurring.

Kaizen is an ongoing series of “events” that involve the participation of selected employees in a team. Each team will aggressively analyze an assigned process or procedure to determine the exact details that are followed. The goal is not to criticize but to identify the inefficiencies or waste (“Muda”). As “Muda” is identified, the team implements the necessary changes to the process in order to eliminate the waste.

The implementation of these changes involves the use of the PDCA cycle - Plan, Do, Check, Act. The key to Kaizen is that “the norm must constantly be questioned to ensure that all work is performed in the best possible manner”. And underlying the process is a belief that “progressive improvement is better than postponed perfection.”

Is “Lean” or “Kaizen” Just for Manufacturing?
“Muda” exists in every business. And regardless of the nature of the business there is a process flow, and at every step in that flow there is the potential for waste-causing interference and inefficiencies.

Eliminating the “Muda”
The analogy of removing rocks from a stream or river is often used to illustrate the art of progressive improvement. Rocks or boulders create turbulence which, as the flow of water in the river changes, can present various threats such as the potential for disaster associated with rapids. If the larger boulders are removed from the rapids, the river flows more smoothly and is safer to navigate. Then as you gradually lower the level of water in the stream, other smaller rocks are exposed, and they too can be removed. By progressively exposing and removing more impediments you get closer and closer to the ultimate goal – a smooth, turbulence free flow of water. The desired result is the same for any process or information flow in business. The flow must be smooth, without impediments and turbulence. To optimize performance, customer satisfaction and profitability, you must eliminate the rocks or “Muda” from all businesses.

Key Performance Indicators (KPI`s)
But before you begin to implement Kaizen you must set clear and measurable goals and objectives. Monthly financial reports don’t necessarily tell you about how well you are servicing your customers or about restrictions and turbulence in the flow of processes and information through your business. You need to establish KPI’s to set and measure goals and objectives, and to guide you through the processes that will eliminate waste.

Be Lean and Trim with the Kaizen Diet
The Kaizen Diet is the solution for any and all businesses, not just manufacturers. As you implement Lean in your business it is critical to remember the following key points.

  • Embrace change.
  • Eliminate waste.
  • Set clear goals and objectives.
  • Establish KPI’s.
  • Continually expose the impediments or “Muda” to your business process flows.
  • Use teams to harness the power of many.
  • Celebrate success and failure.

And most importantly, enjoy the journey. It will set your business apart from the competition and lead you down a road of innovation and profitability.

By Barry T

Atticus Principal

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