The True Difference Between Kaizen and Kaizen by Inspiration
When most companies today talk about Kaizen, they assume that this is just any effort that the company makes to help streamline processes, eliminate waste and hopefully improve profit margins. While that may be accurate in some sense, it is not a complete picture. When Kaizen was first developed within the Toyota Production System, The Kaizen idea was all about keeping the company alive. Every action that was taken had to have a direct benefit to the bottom line.
Today, many companies look first at how they can eliminate waste, and then later (if ever) look at how this can help the bottom line. For example, if a specific task in the facility requires an individual to manually walk across the facility three times each day to get new parts, the company may have a ‘Kaizen’ initiative to install conveyer belts that will automatically bring those parts to the desired location at the right time. This will clearly be more efficient, and results in a better process, so it should be considered a successful Kaizen event, right?
No matter how this change is looked at, it is not possible that this change helped the bottom line of the company. The cost of installing and maintaining the conveyer belt system will be far more than any cost savings the company will realize. In fact, since it is unlikely that the employee whose job it was to get the parts will be let go, which would save the company the cost of that employees salary, since this was only a small part of his job. So, even though the updated process does eliminate waste and improve efficiency, it does not save the company money and cannot be considered a true Kaizen initiative.
Kaizen by Inspiration
When this concept was talked about by one of the pioneers of the Kaizen philosophy, Taiichi Ohno, he called it Kaizen by Inspiration (Omoitsuki Kaizen). To put it simply, this type of effort does not have the best interests of the company in mind (the bottom line) but rather it is solely focused on eliminating waste, at any cost. While there may be a time when this is a good thing, it should not be confused with Kaizen.
It is important for any facility that is attempting to follow the Kaizen methodologies to understand the difference between true Kaizen, and Kaizen by inspiration. It may seem harmless to lump all efficiency efforts or waste reduction projects in with the Kaizen efforts of the company, it can actually cause a lot of problems down the road. If those working in the facility don’t know the difference between true Kaizen, and simple waste reduction today, it may lead to problems with the company in a situation where Kaizen is required for survival.
According to an article on qualtiydigest.com, Jon Miller quotes:
Isn’t kaizen all about people’s ideas, finding things to improve, and inspiration? Ohno would say, “Oh, no.” He gives examples of inspiration kaizen, such as “we can automate this” or “we fixed this” where in fact, money was spent to improve something without proving that it contributed to profit. In fact, these types of kaizen may increase output or efficiency but the money spent may actually increase cost.
-Jon Miller – qualitydigest.com
Focusing on the Bottom Line
No matter the position of a company today, it is almost inevitable that the company will go through financial difficulties at some point in the future. This is why it is so important for the facility to know how to become laser focused on improving the bottom line, at all costs, and this is where true Kaizen can be a powerful ally. When everyone in the facility knows what real Kaizen is, they can pull together as a company to focus on eliminating costs and improving profits to help keep the company alive during hard times.
If everyone has been trained to think that any type of waste elimination automatically translates into a stronger company, however, their efforts may actually make a bad situation worse. It may even be necessary to work less efficiently for a time, to help improve the bottom line of the company. For example, if a company can complete some jobs in-house for significantly cheaper than outsourcing the work to another dedicated facility, even though it takes significantly longer to complete, it might be a good trade off.
Ways to Cut Costs
There are many ways to directly cut costs without impacting the types of services that are being provided, and which bring in the money from customers. The following are some concepts which may be helpful when evaluating whether or not a particular idea is a true Kaizen project, or just a way to streamline processes:
- Combining Jobs – While nobody wants to let employees go, it is sometimes necessary to cut headcount to save money. Combining two jobs into one can save a significant amount of money.
- Focusing on Profit Centers – There are times when letting the non-profit producing sections of a company suffer, and focusing on areas that actually bring in significant income. While this can’t usually be maintained long term, it is sometimes a great option to get through a difficult time.
- Adjusting Work Schedules – Adjusting the operating hours of a facility can sometimes eliminate many costs, and improve the profit margin on the products being produced. When necessary, a facility may need to require off hours shifts or other less than optimal schedules from the employees in order to improve the financial stability of the company.
Target Driven Goals
The bottom line when it comes to Kaizen is that it should always be driven by specific targets related to the profits of a company. In many cases, the waste reduction is just a beneficial byproduct of the true goal, which is increasing profits for the company. While this may not sound politically correct at first, it can help to save the jobs of everyone in the company during particularly difficult times. Understanding this, and accepting it, will help make it easier to adapt and focus on these goals when necessary.
If your company has been performing Kaizen initiatives in the past, it may be a good time to really evaluate the different projects to see if they are truly Kaizen. If they aren’t, re-brand them to something more accurate and begin stressing the important of understanding the difference between Kaizen and Kaizen by inspiration. It might seem like a small thing today, but it could literally save the company in the future.
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