Kaizen

1. Kaizen © Operational Excellence Consulting. All rights reserved. © Operational Excellence Consulting. All rights reserved.

2. NOTE: This is a PARTIAL PREVIEW. To download the complete presentation, please visit: https://www.oeconsulting.com.sg Learning Objectives 1. Understand the key concepts of Kaizen 2. Gain knowledge on the management and practices of Kaizen 3. Learn how to implement Kaizen activities to eliminate waste and improve the organization’s performance 4. Learn the tools and techniques for problem solving 5. Understand the critical role of management in Kaizen implementation 2 © Operational Excellence Consulting. All rights reserved.

3. Outline 1 Introduction to Kaizen 2 Kaizen and Waste 3 Key Concepts of Kaizen 4 Kaizen Management 5 Kaizen Practices 6 Kaizen Implementation 7 Kaizen Story 8 Developing “Kaizen Eyes” 9 Role of Management 10 Critical Success Factors 3 © Operational Excellence Consulting. All rights reserved.

4. What is Kaizen? § The Japanese word “Kaizen” (改 (KAI) to become good (ZEN). 善) means change 改 善 Kai Zen 改 改 善 善 Change Good 4 © Operational Excellence Consulting. All rights reserved.

5. What is Kaizen? § Kaizen means improvement. Improvements without spending much money, involving everyone from managers to employees, and using much common sense. § The aspect of Kaizen is that it is on-going and never- ending improvement process 5 © Operational Excellence Consulting. All rights reserved.

6. What Kaizen IS NOT § A cost cutting program § Fixing people’s jobs without them § Only for manufacturing companies § Automation or implementing an IT system § Working harder § Just a housekeeping exercise, e.g. 5S § Another one of those “extracurricular activities” 6 © Operational Excellence Consulting. All rights reserved.

7. Kaizen & Lean Goals: highest quality, lowest cost, shortest lead times Jidoka Just-In-Time • Continuous flow • Takt time • Pull system • Flexible workforce Involvement Kaizen is the foundation for all Lean improvements • Separate man & machine work •Abnormality Identification • Poka yoke • Visual Control Heijunka Standardized Work Kaizen Stability 7 © Operational Excellence Consulting. All rights reserved.

8. Kaizen is a Continuous Process Kaizen A P D Standardize Act Plan Kaizen C Check Do Standardize Kaizen Kaizen (改 Continuous Improvement 善) = 改 善 Standardize 8 © Operational Excellence Consulting. All rights reserved.

9. Kaizen versus Innovation Kaizen Innovation Un-dramatic Dramatic Low Cost High Cost Low Risk High Risk Human Effort Technology No Brainer More Thought 9 © Operational Excellence Consulting. All rights reserved.

10. 3 Criteria of Kaizen ideas ideas ideas ideas 1. Does the idea reduce waste, improve quality or increase safety? ideas ideas ideas ideas ideas ideas 2. Does it address the root cause? 3. Is it standardized? IDEAS KAIZEN 10 © Operational Excellence Consulting. All rights reserved.

11. Key Kaizen Approaches Good Housekeeping (“5S”) Kaizen Waste (“Muda”) Elimination Standardization 11 © Operational Excellence Consulting. All rights reserved.

12. Benefits of Kaizen § Empowers employees, enriches the work experience and brings out the best in every person § Promotes personal growth of employees and the company § Improves quality, safety, cost structures, delivery, environments, throughput and customer service/satisfaction § Provides guidance from employees, and serves as a barometer for leadership 12 © Operational Excellence Consulting. All rights reserved.

13. Methods to Increase Productivity Current 1 Man 1 Machine 100 Units 1 Hour More Workers Quantitative Approach More Machines How to Increase Productivity? Work Longer Work Harder Qualitative Approach Future 1 Man 1 Machine 120 Units 1 Hour TPS Goal Eliminate Waste & Simplify 13 © Operational Excellence Consulting. All rights reserved.

14. Definition of Waste “Waste is anything other than the minimum amount of equipment, materials, parts, space, and worker’s time which are absolutely essential to add value to the product.” Shoichiro Toyoda President, Toyota © Operational Excellence Consulting. All rights reserved.

15. Work versus Waste Value Add Non Value Add: Pure Waste Non Value Add: Incidental Waste Focus here for improvement 15 © Operational Excellence Consulting. All rights reserved.

16. Value Defined Value-Added Activities § Transforms or shapes material or information § Customer wants it § Done right the first time Non-Value Add: Incidental Waste § No value created but required by current thinking § No value created but required by process limitations § No value created but required by current technology § No value created but required by government/business regulations Non-Value Add: Pure Waste § Consume resources but creates no value for the customer § Could be stopped and it would be invisible to the customer 16 © Operational Excellence Consulting. All rights reserved.

17. “The most dangerous kind of waste is the waste we don't recognize.” Shigeo Shingo © Operational Excellence Consulting. All rights reserved.

18. Cost Reduction Principle Higher profit is achieved by increasing sales price Higher profit is achieved by reducing cost (waste) while maintaining sales price PROFIT 2 PROFIT 1 PROFIT 1 PROFIT 2 SALES PRICE 2 SALES PRICE 1 SALES PRICE 1 SALES PRICE 2 COST 2 COST 1 COST 1 COST 2 Future Future Present Present Cost Reduction Principle Cost Plus Principle 18 © Operational Excellence Consulting. All rights reserved.

19. Eight Types of Waste Over-production Producing more than what the customer needs Waiting Intellect Employees waiting for another process or a machine/tool Not using employees full intellectual contribution Over-processing Adding excess value when the customer does not require it Motion Extra physical/mental motion that doesn’t add value Waste Defects Reprocessing, or correcting work Transportation Moving product from one place to another Inventory Building and storing extra products the customer has not ordered 19 19 © Operational Excellence Consulting. All rights reserved. © Operational Excellence Consulting. All rights reserved.

20. Key Kaizen Concepts Kaizen & Management Follow SDCA / PDCA Cycles Process Vs Results Speak with Data Quality First Next Process Is Customer 20 © Operational Excellence Consulting. All rights reserved.

21. Kaizen & Management Maintenance Improvement § Follow current Standard Operating Procedures (SOP) § Upgrade existing Standard Operating Procedures (SOP) § SDCA § PDCA 21 © Operational Excellence Consulting. All rights reserved.

22. Modern Perception of Kaizen & Job Functions Top Management Innovation Kaizen Middle Management Maintenance Supervisors Workers 22 © Operational Excellence Consulting. All rights reserved.

23. “Where there is no standard, there can be no improvement. For these reasons, standards are the basis for both maintenance and improvement.” Masaaki Imai © Operational Excellence Consulting. All rights reserved.

24. Cross-functional Management Kaizen Management Maintenance Management Kaizen Maintenance Policy deployment Routine (daily) management Line organization Quality Cross-functional management Cost Delivery Small-group activities Individual suggestions Source: Kaizen by Masaaki Imai 24 © Operational Excellence Consulting. All rights reserved.

25. Kaizen – The Practice Management- Oriented Kaizen Group-Oriented Kaizen Individual- Oriented Kaizen Tools Basic Tools Basic Tools Common sense Advanced Tools Advanced Tools Basic Tools Professional skills Involves Managers & Professionals Group members Everybody Target Focus on systems & procedures Within the same workshop Within one’s own work area Cycle (Period) Lasts for the duration of the project Requires 4-5 months to complete Anytime 25 © Operational Excellence Consulting. All rights reserved.

26. Gemba House Input Process Output Man A P D Quality Machines C Materials Cost A S D Methods Delivery C Measurements Operational + Materials Standards 5S = Housekeeping Discipline NVA = Muda + Mura + Muri 26 © Operational Excellence Consulting. All rights reserved.

27. “Kaizen means ongoing improvement involving everybody, without spending much money.” Masaaki Imai © Operational Excellence Consulting. All rights reserved.

28. Kaizen Circle Roles & Responsibilities Role Responsibilities Attend meetings. Contribute ideas. Choose and analyze problem. Recommend and implement solutions. Make presentations. Circle Member Attend training. Guide team members through problem-solving process. Attend circle meetings. Complete and submit KCA meeting records. Facilitator Attend training. Provide technical and administrative advice as required. Attend circle meetings. Help coordinate presentations to management. Advisor Develop and conduct training. Attend circle meetings if requested. Provide problem-solving training if requested. Collect meeting records and report to management. Circle Trainer Encourage circle formation and involvement. Periodically check circle progress and offers suggestions. Approve recommendations. Attend presentations. Manager 28 © Operational Excellence Consulting. All rights reserved.

29. Kaizen Event Process 1. Set the Scene 5. Report & Celebrate 2. Understand Current Process 3. Develop Future State Design 4. Implement Solutions 29 29 © Operational Excellence Consulting. All rights reserved. © Operational Excellence Consulting. All rights reserved.

30. Kaizen Example – Office Desk After Before An office desk before and after conducting 5S Sort and Set In Order. Clutter and unused items have been removed leaving only what is needed. 30 © Operational Excellence Consulting. All rights reserved.

31. Kaizen Example – Office Stationery All stationery items are clearly visible and easy to retrieve. On the left, there are forms for re-ordering supplies. On the right is a map of the items and their locations, forms for comments/suggestions, and contact information. 31 © Operational Excellence Consulting. All rights reserved.

32. Kaizen Example – Tooling Management Organized tools and materials for better shopfloor productivity and safety 32 © Operational Excellence Consulting. All rights reserved.

33. Kaizen Summary Sheet – Example 1 Project type: 5S Area: Sales & Marketing Office Team Leader: John Smith Before After Reasons project chosen: • Difficult to move around a cluttered office • Difficult to find information and supplies Tools used on project: • Cleaning equipment and tools • 5S principles Results: • Unwanted materials were discarded • Less waste – e.g. transportation, motion, waiting, etc. • Improved staff morale Next steps: • Conduct monthly 5S audits • 5S for other common areas 33 © Operational Excellence Consulting. All rights reserved.

34. The 5W & 1H of Kaizen Who? What? Where? 1. 2. 3. 4. 5. 6. Who does it? Who is doing it? Who should be doing it? Who else can do it? Who else should do it? Who is doing 3-Mu’s? 1. 2. 3. 4. 5. 6. What to do? What is being done? What should be done? What else can be done? What else should be done? What 3-Mu’s are being done? Where to do it? Where is it done? Where should it be done? Where else can it be done? Where else should it be done? Where are 3-Mus’ being done? How? 1. 2. 3. 4. 5. 6. When? Why? 1. 2. 3. 4. When to do it? When is it done? When should it be done? What other time can it be done? What other time should it be done? Are there any time 3-Mu’s? 1. 2. 3. 4. 5. 6. Why does he do it? Why do it? Why do it there? When do it then? Why do it that way? Are there 3-Mu’s in the way of thinking? 1. 2. 3. 4. How to do it? How is it done? How should it be done? Can this method be used in other areas? Is there any other way to do it? Are there any 3-Mu’s in the method? 5. 5. 6. 6. Source: Masaaki Imai 34 © Operational Excellence Consulting. All rights reserved.

35. About Operational Excellence Consulting § Operational Excellence Consulting is a management training and consulting firm that takes a human-centered approach to helping organizations in the public and private sectors to work smarter and grow faster. § The firm’s mission is to create business value for organizations through innovative operational excellence management training and consulting solutions. § OEC takes a unique “beyond the tools” approach to enable clients develop internal capabilities and cultural transformation to achieve sustainable world-class excellence and competitive advantage. For more information, please visit www.oeconsulting.com.sg 35 © Operational Excellence Consulting. All rights reserved.

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