Kaizen

Management – a different

approach

• Management has two major components:

1. Maintenance

2.Improvement

• Under the maintenance function, the

management must first establish policies,

rules, directives and standard operating

procedures (SOPs) and then work towards

ensuring that everybody follows SOP.

• Under the improvement function,

management works continuously towards

revising the current standards, once they

have been mastered, and establishing

higher ones.

Management - Improvement

• Improvement can be broken down between

innovation and Kaizen.

• Innovation involves a drastic improvement in the

existing process and requires large investments.

Kaizen signifies small improvements as a result of

coordinated continuous efforts by all employees.

• Kaizen (the translation of kai (change) zen (good)

is “improvement‖). This method became famous

by the book of Masaaki Imai “Kaizen: The Key to

Japan's Competitive Success.”

So what is Kaizen ?

• Kaizen refers to philosophy or practices that focus upon continuous

improvement of processes in manufacturing, engineering,

supporting business processes, and management.

• By improving standardized activities and processes, kaizen aims to

eliminate waste as in lean manufacturing( Toyota Production

System ).

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Why Use Kaizen?

• To solve problems (without already knowing the solution)

• To eliminate waste (Muda)

• Transportation, Inventory, Motion, Waiting, Over-production,

Over-processing, Defects

• Create ownership and empowerment

• Support lean thinking

6

7

KODAK OPERATING SYSTEM

―All we are doing is looking at the time line; from the

moment the customer gives us an order, to the point when

we collect cash. We are reducing that time line by

removing the non-value-added wastes.‖

Taiichi Ohno

Order Cash

(Reduce by removing non-value-added wastes)

Simple, very clear focus

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Do It Again

Kaizen

Identify Waste

Plan Counter- measures

Reality Check

Make Changes

Celebrate

Measure Results

Make this

the Standard

Document

Reality

Verify Change

Start Here

Kaizen Cycle

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Six Basic Rules of Kaizen

Be safe / Think safe

Both in your actions and in what you implement

Ask why (the 5 why’s)

Gain complete understanding, assume nothing

Try something new

Be open minded - try it instead of racking your brain for reasons why it won’t work (try-storming)

Do your share

Everyone has to contribute

Document reality

If you make changes based on data, the data should be based on reality

Respect others

Particularly the local operators, you are in their living room

How did it gain importance ?

• Kaizen was first implemented in several Japanese businesses after

World War II, influenced in part by American business and quality

management teachers who visited the country.

• It has since spread throughout the world and is now being

implemented in many other venues besides just business and

productivity.

Where is it applicable ?

• It has been applied in healthcare ,psychotherapy, life-coaching,

government, banking, and many other industries.

• When used in the business sense and applied to the workplace,

kaizen refers to activities that continually improve all functions, and

involves all employees from the CEO to the assembly line workers.

• It also applies to processes, such as purchasing and logistics, that

cross organizational boundaries into the supply chain.

Kaizen and Management Levels

Key Features of Kaizen

• Improvements are based on many, small changes rather than the radical changes that might arise from R & D .

• As the ideas come from the workers themselves, they are less likely to be radically different, and therefore easier to implement

• Small improvements are less likely to require major capital investment than major process changes

• The ideas come from the talents of the existing workforce, as opposed to using R&D, consultants or equipment – any of which could be very expensive

• All employees should continually be seeking ways to improve their own performance

• It helps encourage workers to take ownership for their work, and can help reinforce team working, thereby improving worker motivation

Thus

• Kaizen is a daily process, the purpose of which goes beyond simple productivity improvement.

• It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work ("muri"), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes.

7 Conditions for Successful Implementation

of Kaizen Strategy

1. Top management commitment

2. Top management commitment

3. Top management commitment

4. Setting up an organization dedicated to promote Kaizen

5. Appointing the best available personnel to manage the Kaizen process

6. Conducting training and education

7. Establishing a step-by-step process for Kaizen introduction.

The Key Kaizen Practices

• customer orientation

• quality control (QC) circles

• suggestion system

• discipline in the workplace

• small-group activities

• cooperative labor-management relations

• total quality management (TQM)

• quality improvement

1.Mindset & Culture

The Key Kaizen Practices

• automation & robotics

• Autonomation ( jidoka )

• zero defects

• total productive maintenance (TPM)

• kanban

• Just-in-Time (JIT)

• productivity improvement

• new product development

2.Production Process

The quick and easy kaizen process

1. The employee identifies a problem, waste, or an opportunity for improvement and writes it down.

2. The employee develops an improvement idea and discusses it with his or her supervisor.

3. The supervisor reviews the idea within 24 hours and encourages immediate action.

4. The employee implements the idea. If a larger improvement idea is approved, the employee should take leadership to implement the idea.

Kaizen at Toyota

• There are two kinds of kaizen activities at Toyota: kaizen made by the supervisory staff and engineers as their functions, and that made by workers through the quality circles and suggestion system.

• The management sets a reference ( target ) cost of each of the parts and a standard time for their production. Then the shop floor that produces these parts and vehicles firstly endeavors to attain these costs and standard time, and then reduces them by carrying on kaizen activities.

• A maintenance team contributes to increasing the reliability of equipment mainly by executing preventive maintenance and equipment kaizen.

Kaizen at Toyota

• An assembly line is divided into about ten segments per function. It is permitted to have a buffer between two segments, the buffer corresponding to five minutes operations. Thus, when a segment is stopped because of a problem, the others continue to work. So, the production efficiency of the assembly line as a whole does not get lower .

• A large conveyer installed on the ground level permit workers to operate, standing on it and without walking much with a car body moving, and especially without walking backward.

• Tasks to carry heavy parts also disappeared by installing automatic or semi-automatic equipment

Summary

• Kaizen signifies small improvements as a result of coordinated continuous efforts by all employees.

• It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work, and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes.

• The key Kaizen practices are classified as those which are part of the culture and mindset , and those which are part of the production .

Improving Productivity And Profitability

Through KAIZEN at Gokaldas Exports

Ltd.(GEX)

CASE

STUDY

About GEX • Gokaldas Exports Ltd. (GEX) is one of India’s largest apparel

exporter.

• GEX’s founding principles of ―passion, performance, people and

products‖ fueled phenomenal growth over 30 years.

• Through hard work and a dedication to innovation and quality, the

Hinduja family built their company into a major supplier of the

world’s most preferred apparel brands, including leading casual and

sports clothing lines such as Nike and The Gap.

• It is a ―one-stop shop‖ for the world’s most preferred apparel brands,

including major casual and sports clothing lines.

• In 2008, GEX had US $250 million in sales and employed 45,000

people working in 45 factories.

• The company has the capacity to produce 2.5 million garments a

month.

The Challenge

• At the dawn of the 21st century, increasing competitiveness in the

global garment industry started depressing the company’s profits.

GEX’s leaders determined they would need to improve profits 15

percent to 20 percent without adding resources in order to maintain

their leading position and remain competitive in the high-volume,

low-margin global garment industry.

• Nike, a major client, strongly suggested that the company implement

lean process improvements.

• Some members of GEX’s leadership team recognized that lean

management could be a long-term solution, but long-time family

members resisted, a common reaction to new ideas in many Indian

businesses that have achieved success using a traditional

management philosophy. They believed it was a good idea for

automotive and other heavy-industry companies, but not theirs.

Solution

• Nike so strongly believed that lean practices would position GEX for

the future that the company paid for TBM Consulting to assess

GEX’s operations in March of 2007.

• The assessment revealed the potential for significant improvement,

but GEX’s leaders still resisted.

• Finally, when learning of TBM’s unconditional satisfaction

guarantee, the founding fathers agreed to test the waters.

Pilot Makes an Impression

• The first kaizen event took place at a pilot plant in May 2007. That

fall, GEX executives attended a ―CEO boot camp‖ hosted by TBM at

which they learned of many successful lean implementations

outside of heavy industry.

• TBM and GEX launched their LeanSigma journey at GEX’s Euro

Clothing Company (ECC).

• The implementation went so well, it sparked a raging fire that started

spreading throughout the rest of the company. Finally, the

company’s leaders fully embraced the Lean philosophy.

Improvements At the ECC Plant

Expansion

• From January 2008 to March 2009, TBM and GEX expanded the

program to four plants, leading to remarkable results

• The company expanded its Lean approach to 15 plants by March of

2010 (75 percent of capacity) and is expanding kaizen events to

business processes as well.

• Companywide, GEX teams hold an average of 10 kaizen events a

week.

Results Lean has become a key enabler for GEX and its future continued

success in driving revenue, quality, and profitability. While the retail-

clothing sector was devastated by a global recession, GEX made

significant strides in on-time delivery, firstpass yield, and productivity—

even growing sales by two percent in spite of a dreadful economic

downturn. Key improvements are helping to significantly improve its

competitive position within the industry: lead time, employee

absenteeism and attrition.

Results

Results

Overcoming Cultural Challenges • India’s culture can create unique challenges when introducing and

applying lean, something that was evident from the beginning of

GEX’s efforts.

• The biggest challenge relates to worker absenteeism. When it

comes to choosing between family events and going to work, family

wins most of the time, especially because the garment-industry

workforce is comprised mostly of women.

• Another challenge is that India is a highly structured and segregated

culture in many ways. Socially, there is the well-known caste

system, and in the workplace, the tradition of bosses holding power

and dictating instructions to workers remains.

• Key to convincing the elders in the upper-management was

patience, perseverance and taking small-but-convincing steps such

as starting with one kaizen at one plant.

• At the employee level, training of mid-managers planted lean

thinking at the group-leader level because it was apparent the new

practices would have to be accepted among mid-managers before

plant-level employees could be properly trained.

Overcoming Cultural Challenges

• Additionally, GEX appointed dedicated continuous improvement

officers to each site.

• The company now has 65 such officers at 15 locations. The officers

have helped to bridge the gap between the ultra-traditional

workplace cultures of India and lean management’s emphasis on

employee empowerment.

• For example, eliciting improvement ideas from operators has been

difficult because it’s not in their nature to decide for themselves what

to do. The idea of following the boss’s order has been instilled in

them from childhood. So, the continuous improvement officers tend

to introduce improvement ideas for kaizens.

Overcoming Cultural Challenges

Going Forward

• The global recession starting in 2008 caused a drastic drop in

apparel demand, but GEX is positioned to weather the downturn.

• India is the world’s sixth-largest apparel exporter, and the third-

largest among Asian nations. As the global economy recovers and

demand bounces back, a wave of consolidation among small-scale

producers is expected.

• As a large-scale lean producer, GEX is positioned to grow revenues

with limited investment in new resources.

GEX Lean Timeline

Kaizen Week at GEX

THANKYOU PRESENTED BY:

AKRITI DIXIT(1)

SAKSHI KHURANA(14)

SUGANDHA RATHORE(20)