The Scenario Imagine that one day you log in to your organization’s website and find that the customer satisfaction score has dipped by a big margin. Quickly browsing through the most recent comments, you see that your customers are complaining about late delivery, poor quality products and disgruntled delivery staff. As a Process Improvement Manager, you decide to run a test improvement project for a month, using a new 3PL provider to deliver your products to a small sample of your customers. Over a month’s run, you see that the customers are pleased with the service and have given a positive feedback on the website. Your GM is extremely happy as Customer Satisfaction is a very critical Business metric and tapping into its potential has shown growth to the organization. Job well done!!
What you just did was to go around a single Process Improvement loop which ultimately helped you in improving your organizations delivery problem. This improvement loop is nothing but the Deming’s Wheel also called as the PDCA (Plan-Do-Check-Act) Cycle. This four-step management technique was developed by renowned American statistician, professor, and management consultant Dr William Edwards Deming in the 1950s. Deming himself called it the "Shewhart Cycle," as his model was based on an idea from his mentor, Walter Shewhart, who was referred to as the “Father of Quality Management”
PDCA is a simple four-stage method that enables teams to avoid recurring mistakes and improve processes. Deming wanted organizations to create a way of identifying why errors would take place in any process and what caused products to fail the customer’s expectations. The PDCA approach helps businesses to develop several scenarios about what needs to change, and then test these in a continuous feedback loop.
KAIZEN Around the same time when Western organizations began implementing the PDCA approach, KAIZEN culture saw its inception in the East. The term was primarily coined by renowned Japanese organizational theorist and management consultant “Masaaki Imai” through his ground-breaking book ‘KAIZEN: The Key to Japan’s Competitive Success’. The word literally translates to ‘Change’ (KAI) ‘for the good’ (ZEN). It revolves around the idea that small, ongoing positive changes can reap significant improvements. Typically, it is based on cooperation, commitment and stands in contrast to approaches that use radical changes like the PDCA to achieve transformation. Imai believed that this model of small, incremental change looks at the big picture. The methodology works at constant improvements mainly through the elimination of waste. Although the changes may seem minuscule and insignificant at the time of implementation, they can add up to significant improvements in the long run. So, although an improvement may be achieved through a PDCA cycle, it needs to be sustained by adding an extra ‘R (Repeat)’ into Deming’s wheel.
PILLARS The five critical pillars which form the culture’s underlying foundation are:
1. Know Your Customer: Knowledge of who you sell your product or service to and how we can create value to that person. It is very important that organizations are able to identify their customer’s exact needs to enhance their experience.
2. Let It Flow: Achieving Zero waste should be the end goal for every organization. Every employee right from the Top management to the operational staff should focus on removing any kind of waste from their corner of the business which in turn would create value.
3. Go to Gemba: Although we all love our cosy workplace cabins, in order to really understand the problem, one needs to deep dive into the heart of it. This can be achieved only by visiting the Gemba “the real place.”
4. Empower People: This is directed towards teams and having them organized in such a way that it supports the kaizen principles. Managers must set SMART goals for their teams that are not contradictory. Every employee should have access to all means that are required to achieve these goals.
5. Be Transparent: It is the openness and acceptability of information that is most crucial to an improvement effort. Process performance and improvements must be tracked with real data and it should be available to everyone concerned with that process.
BENEFITS Kaizen aims to achieve improvements in efficiency levels, safety, productivity, effectiveness, and waste reduction. Some of the key benefits are:
· Less waste – Complex non-value add processes are simplified, inventory (be it manpower or actual goods) is used more efficiently as are employee skills.
· Satisfied Internal Customers – This refers to employees who are happy with their roles and quite content with the way things are done.
· High levels of commitment – Team members enjoy their job and are inclined to commit to doing a good one.
· High retention rate – Satisfied and engaged people are more likely to stay in the organization.
· Improved problem solving – Beginning to identify improvement opportunities in processes, employees gain a completely new perspective to solve problems continuously.
· Improved competitiveness – An increase in efficiency levels tends to contribute to pull down operational costs.
· Improved consumer satisfaction – With better product / service quality, customer’s prime needs are met and this in turn will improve the Business ratings as well.