Kaizen

Kaizen

Investopedia / Alex Dos Diaz

What Is Kaizen?

Kaizen is a Japanese term meaning change for the better or continuous improvement. It is a Japanese business philosophy that concerns the processes that continuously improve operations and involve all employees. Kaizen sees improvement in productivity as a gradual and methodical process.

The concept of kaizen encompasses a wide range of ideas. It involves making the work environment more efficient and effective by creating a team atmosphere, improving everyday procedures, ensuring employee engagement, and making a job more fulfilling, less tiring, and safer.

Key Takeaways

  • Kaizen is a Japanese business philosophy that focuses on gradually improving productivity and making a work environment more efficient.
  • Kaizen supports change from any employee at any time.
  • Kaizen translates to change for the better or continuous improvement.
  • Kaizen's small changes can involve quality control, just-in-time delivery, standardized work, the use of efficient equipment, and the elimination of waste.
  • The Kaizen methodology underscores that small changes now can have big future impacts. supports.

Understanding Kaizen

Some of the key objectives of the kaizen philosophy include quality control, just-in-time delivery, standardized work, the use of efficient equipment, and the elimination of waste.

The overall goal of kaizen is to make small changes over a period of time to create improvements within a company. That doesn't mean alterations happen slowly. The kaizen process simply recognizes that small changes now can have huge impacts in the future.

Improvements can come from any employee at any time. The idea is that everyone has a stake in the company's success and everyone should strive, at all times, to help make the business model better.

Many companies have adopted the kaizen concept. Most notably, Toyota employs the kaizen meaning and philosophy within its organization. It esteems kaizen as one of its core values. To improve its production system, Toyota encourages and empowers all employees to identify areas of potential improvement and create viable solutions.

Fast Fact

Toyota’s process of identifying solutions is called "kaizen blitz."

How Does Kaizen Work?

Kaizen involves five key principles: know your customer, let it flow, go to gemba (or the real place), empower people and be transparent.

These five principles lead to three major outcomes: elimination of waste (also referred to as economic efficiency), good housekeeping, and standardization. Ideally, kaizen becomes so ingrained in a company's culture that it eventually becomes natural to employees.

The kaizen meaning posits that there is no perfect end and that everything can be improved upon. People must strive to evolve and innovate constantly.

The basic idea of kaizen is that people who perform certain tasks and activities know the most about them. Empowering those people to effect change is the best strategy for improvement.

Teamwork is core to kaizen, where regular team meetings are held involving discussions about improvements, changes, and projects.

What Are Some Benefits of Kaizen?

Kaizen offers companies many valuable benefits. Some of them are:

  • Greater staff satisfaction
  • Improved customer satisfaction
  • Reduction in staff turnover
  • Strengthened employee loyalty
  • Lower costs
  • Greater efficiency and productivity
  • Better problem solving

Kaizen and the PDCA Cycle

Improvements generally follow the PDCA cycle format. PDCA stands for Plan-Do-Check-Act. The Plan portion includes proposing and mapping out changes so that everyone knows what to expect when teams try to solve a problem.

The Do stage implements the best solution for the problem. The Check step involves evaluating the solution to the problem to see if it worked.

When a company Acts, it determines whether or not the solution should become a company standard or if it needs further changes. If managers decide to implement more changes, kaizen goes back to the Plan step and the process starts over.

Just-in-Time Inventory Strategy

One of the key goals of the kaizen process is to reduce waste and increase efficiency in the production cycle. A just-in-time (JIT) inventory strategy allows management to minimize excess inventory by matching the delivery of raw materials from suppliers with production schedules.

The JIT strategy is also known as the Toyota Production System (TPS), for the company that popularized it, JIT helps companies cut costs because manufacturers do not have to pay inventory carrying costs. It also reduces waste because companies are not left with extra inventory should a customer cancel or postpone an order.

Kanban is an inventory control system used in conjunction with a JIT strategy. It provides employees with visual cues that tell them it is time to order parts and materials as they run out.

The system relies on colored cards that track production and alert employees when it's time to replenish a needed part or material. It enables employees to quickly order the correct number of parts from the supplier and have them delivered to where they are needed in the factory.

The goal of kanban is to ensure the efficient running of the factory assembly line and to prevent bottlenecks from occurring.

What Are the 5 Elements of Kaizen?

The five kaizen elements or principles are: know your customer, let it flow, go to gemba, empower people, and be transparent. People also sometimes ask what kaizen 5S refers to. It's a process often used in lean manufacturing and relates to five steps of improvement: Sort, Straighten, Sweep, Standardize, and Sustain. A 5S event follows each of these steps one day at a time.

What Is the Kaizen Method?

It's a business philosophy with guiding principles and tools that seeks to involve all employees in the gradual and continuous improvement of various areas of a company. The kaizen method focuses on engaging employees and using teamwork to create a successful and enjoyable work environment.

What Is an Example of Kaizen?

Toyota is a famous example of a company using kaizen to sustain its success. Another commonly known example of kaizen in action involves Ford Motor Company, which embraced kaizen to cut the time it took to complete various manufacturing processes.

What Are the Main Tools of Kaizen?

The kaizen methodology uses different tools depending on the goal. For instance, the 5S tool is often used in lean manufacturing and to ensure that workplaces are efficient, productive, and safe. JIT and Kanban are used for inventory control. The five whys (what, when, where, why, and who) is a tool used to reveal the root cause of a problem. Value stream mapping is an analytic tool that is used to identify places to eliminate waste. Follow-up events are tools used to sustain improvements.

Article Sources
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  1. Toyota. "Toyota Production System."

  2. Kaizen Institute. "What Is Kaizen™."

  3. United States Environmental Protection Agency. "Lean Thinking and Methods — Kaizen."

  4. Kaizen Consulting Group. "Kaizen."

  5. Kaizen Consulting Group. "Plan Do Check Act (PDCA) Cycle."

  6. United States Environmental Protection Agency. "Lean Thinking and Methods — JIT/Kanban."

  7. Six Sigma. "What Is a 5s Event?"