Six Steps of Kaizen by Operational Excellence Consulting

© Operational Excellence Consulting. All rights reserved.
6 Steps
of KAIZEN
6 Basic Steps to Improvement

© Operational Excellence Consulting. All rights reserved. 2
Learning Objectives
1. Understand the principles and key concepts of kaizen
2. Acquire in-depth knowledge on the six basic steps of
kaizen
3. Understand the application of the key tools of kaizen
4. Define the critical success factors in developing and
sustaining a kaizen culture

Outline
1. Introduction to Kaizen
2. Step 1: Discover Improvement Potential
3. Step 2: Analyze the Current Methods
4. Step 3: Generate Original Ideas
5. Step 4: Develop an Implementation Plan
6. Step 5: Implement the Plan
7. Step 6: Evaluate the New Method
8. Critical success factors
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NOTE: This is a PARTIAL PREVIEW. To
download the complete presentation, please visit:
http://www.oeconsulting.com.sg

What is Kaizen?
• The Japanese word “Kaizen” (改善) means change
(KAI) to become good (ZEN)
改善
Change Good
Kai Zen

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.

"Continuous effort -
not strength or
intelligence - is the
key to unlocking our
potential."
Sir Winston Churchill

The Importance of Kaizen
• Increasing competition
• High customer expectations
• Customers want value for money
• Product innovation
• Supply chain efficiency
• Need for continuous improvement

Five Requirements of a Leader
SKILL
Instructing
Leading
Improving
Methods
Work
Responsibilities
KNOWLEDGE

Five Ways to Increase Production
How to
Increase
Productivity?
Quantitative
Approach
More Workers
More Machines
Work Longer
Qualitative
Approach
Work Harder
Eliminate Waste
& Simplify
Current
1 Man
1 Machine 100 Units
1 Hour
Future
1 Man
1 Machine 120 Units
1 Hour
TPS
Goal

Processing Methods Affect Cost
A
B C
INVENTORY
INVENTORY
INVENTORY MATERIALS
FINISHED
PRODUCTS
FINISHED
PRODUCTS
A CB
MATERIALS
Traditional System
 When Process A completes its
work, it hands the product off
to Process B, where it is stored
until needed.
Pull System
 Process B is responsible for
getting parts and supplies from
Process A as they are needed.
There is no intermediate
storage.
Leaders need to identify more efficient ways of
doing things.

Work versus Waste
Value Add
Non-Value Add:
Incidental Waste
Non-Value Add:
Pure Waste
Focus here for
improvement

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

Cost Reduction Principle
Cost Plus Principle
COST 1
SALES
PRICE
1
PROFIT
1
Present
COST 2
PROFIT
2
Future
SALES
PRICE
2
Cost Reduction Principle
COST 1
SALES
PRICE
1
PROFIT
1
Present
COST 2
PROFIT
2
Future
SALES
PRICE
2
Higher profit is
achieved by
increasing sales price
Higher profit is
achieved by reducing
cost (waste) while
maintaining sales price

“Insanity is doing the
same thing, over and
over again, but
expecting different
results.”
Albert Einstein

Six Steps of Kaizen
1. Discover
Improvement
Potential
2. Analyze the
Current Methods
3. Generate
Original Ideas
4. Develop an
Implementation
Plan
5. Implement the
Plan
6. Evaluate the
New Method
KAIZEN

Six Steps of Kaizen
DESCRIPTION
 Learn to see waste or improvement potential around the work areas.
 Develop mindset and attitude required for people to be successful in
process improvement.
 Analyze current methods of various work-related processes.
 Examples of analytical methods include work analysis, motion analysis,
time study, standardized work, machine loss analysis, and material flow
analysis.
 Apply techniques for stimulating original ideas and synthesizing solutions.
 Create effective plan for implementation, including communication and
tracking purposes. When possible, make changes quickly and effectively
as the situation allows.
 Create a positive atmosphere and attitude toward implementing kaizen.
 Communicate thoroughly with affected parties in the organization.
 Follow up on implementation as needed
Discover Improvement
Potential
Analyze the Current
Methods
Generate Original
Ideas
Develop an
Implementation Plan
Implement the Plan
 Evaluate the results of the action items performed in order to verify the
actual level of improvement.
 Standardize work practices and follow up to ensure gains are sustained.
Evaluate the New
Method
Source: Kato & Smalley
1
2
3
4
5
6

Kaizen versus Problem Solving
• Problem solving
 Centers on the fundamental notion of “gap” or “deviation” from
standard (e.g. cost, quality, delivery)
• Kaizen
 Focuses on achieving a new standard or level of performance
Standard – what should
be happening
Current situation – what
is actually happening
Gap = Problem

Kaizen Attitude
Kaizen Attitude
 Get the facts from the source
 Don’t be swayed by preconceived notions
 Practice through observations (5 Why Thinking)
 Calm attitude (be rational)

Methods Comparison
Scientific Method Problem Solving Six Steps of Kaizen
 Make Observations  Define Problem
 Identify Improvement
Potential
 Gather Information  Analyze Causes
 Analyze Current
Methods
 Form Hypothesis  Set a Goal  Generate Original Ideas
 Perform Experiment to
Test Hypothesis
 Implement Corrective
Actions
 Develop an
Implementation Plan
 Analyze Data  Check Results  Implement Action Items
 Draw Conclusions &
Summarize
 Follow Up / Standardize
 Evaluate Results /
Standardize

Analytical Skills for Kaizen
1
2
3
Classify and organize
Quantify the observations
Specifiy the details

Basic Methods for Uncovering Waste &
Identifying Improvement Opportunities
• There are five basic methods for uncovering waste:
1. Compare Performance to Standards
2. Production Analysis Board
3. Using the Back Door
4. Five S
5. The Eight Deadly Wastes

The 4-Step Process for Job Methods
1
2
3
4
Breakdown the Job
Question Every Detail
Develop the New Method
Apply the New Method

5W 1H & ECRS
Step 3: Develop The New Method
Eliminate
Combine
Rearrange
Simplify
5W 1H
Questions
ECRS
Framework
Why?
What?
Where?
When?
Who?
How?

Equipment Loss Analysis
Source: Japan Institute of Plant Maintenance (JIPM)
Equipment Loss Analysis & OEE
Equipment
Losses
Availability
Breakdowns
Changeover Time
Performance
Cycle Time
Minor Stops
Quality
Scrap or
Rework
Startup or
Yield Losses
Six Equipment Losses

• Creates an end-to-end view of the production system
• Demonstrates interaction between material/work and information flow
• Provides a common visual language for understanding a complex system
Supplier Management
Control
Customer
Work & Information Flow
Information flow
A Value Stream Map Provides an Overview of
the End-to-end Production Process

The Value-added Flow Chart
• The value-added flow chart is a mechanism to improve
cycle times and productivity by visually separating value-
adding from non-value-adding activities. The process is
very straightforward, as outlined in this section.

Figure 1
Total Cycle Time
= 116.5 Hours
Steel Coil Stock
Inventory (96 Hr.)
Stamp Steel (0.3
Hr.)
Buffer Inventory (8.0
Hr.)
Inspection & Rework
(0.2 Hr.)
Paint Cabinet (0.5
Hr.)
Test & Rework (0.2
Hr.)
Final Assembly (3.0
Hr.)
Hr.)
Buffer Stock (3.0
Hr.)
Inspection & Rework
(0.1 Hr.)
Cabinet
Construction (0.2
Hr.)
Steel Coil Stock
Inventory (96 Hr.)
Stamp Steel (0.3
Hr.)
Hr.)
Inspection & Rework
(0.2 Hr.)
Paint Cabinet (0.5
Hr.)
Test & Rework (0.2
Hr.)
Final Assembly (3.0
Hr.)
Hr.)
Buffer Stock (3.0
Hr.)
Inspection & Rework
(0.1 Hr.)
Cabinet
Construction (0.2
Hr.)
Total Value-Added
Time = 4.0 Hours
Total Non-Value-Added
Time = 112.5 Hours
Figure 2
Value-Added Non-Value-Added
3%
97%
Cycle Time Analysis
Value-Added
Non-Value-Added
Figure 3

Methods for Developing Innovative Ideas
1. Brainstorming
2. Listing Faults
3. Listing Wishes
4. Listing Characteristics
5. The Gordon Method
6. Osborn’s Checklist
7. 5W1H & ECRS
8. Brainwriting
9. Nyaka Method
10. NHK Method
11. SCMAPER
12. What If?
13. Rules for Motion Economy

Implement the Plan
• A good strategy is of no use if it is not executed properly.
Plans on paper have to be translated into specific and
effective action items on the shop floor that result in
change for the better.
• There are three key points for successful implementation
of the plan
1. Effective communication
2. Training and instruction
3. A positive and energetic attitude

Effect Confirmation – Example of ‘Before’ and
‘After’ a process improvement comparison
Restaurant Complaints
Before After
33%
Reduction in
Wait Time
ILLUSTRATIVE

Kaizen Summary Sheet
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
Project type: 5S Area: Sales & Marketing Office Team Leader: John Smith

“A leader is best when
people barely know he
exists, when his work
is done, his aim
fulfilled, they will say:
we did it ourselves.”
Lao Tzu

About
Operational
Excellence Consulting

About Operational Excellence
Consulting
• Operational Excellence Consulting is a management training and
consulting firm that assists organizations in improving business
performance and effectiveness.
• One of our unique strengths is going beyond a tools-focused
approach to seamlessly integrate people, processes, technology
and continuous improvement initiatives to suit the specific needs
and situations of our clients.
• We provide corporate learning programs and management advisory
services to assist our clients to achieve breakthrough in business
performance and effectiveness. Our aim is to support our clients in
designing, managing and executing lasting beneficial change.

END OF PARTIAL PREVIEW
To download this presentation,
please visit:
www.oeconsulting.com.sg

Six Steps of Kaizen by Operational Excellence Consulting

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