Business Benefits You Can Expect From Kaizen

Level: Beginner

What you will learn

• How to use Kaizen for quality improvement
• Applying Kaizen to productivity improvements
• How leveraging Kaizen can lead to stronger employee engagement
• Kaizen’s cost savings benefits

Companies that adopt a Kaizen approach, focusing on continuous improvement, can reap tremendous benefits. Information and creativity flows more smoothly. Teams work more effectively together. And of course there are business gains as well.

A successfully deployed Kaizen approach can:

• Drive quality improvements.
• Boost productivity improvements.
• Lead to stronger employee engagement.
• Generate cost savings.

Using Kaizen for Quality Improvement

At its heart, Kaizen is about driving greater value for the customer. To that end, it encourages the entire workforce to constantly be on the lookout for problems. While this might seem counter-intuitive at first, workers who are looking for problems are actually looking for ways to improve processes. Once a flaw or inefficient process is identified, then can begin the work of improving or transforming it.

By constantly looking to improve processes , organizations can produce higher quality output that consumes less waste and contains fewer flaws. The result is better products that meet or exceed customer expectations.

Case In Point: XYZ Cement Co.

In a paper published by IEEE, XYZ Cement Co. described a problem that began when it added a new production line to increase its cement production capacity. While the number of bags of cement rose as desired, the company also began seeing defective cement bags far above its allowable limit.

The company launched a Kaizen event, using Lean Six Sigma and process capability measurement to identify the root causes of the defective products. The Kaizen team found that the level of cement bag production in four production lines had 11 possibilities of defect per unit, and through the project was able to identify improvements that could improve the overall quality of the product.

A Kaizen Approach to Productivity Improvement

Kaizen is often used to reduce production cycles and improve throughput. After all, this philosophy is all about finding ways to get more work done, with less waste, in the same amount of time. By examining the current process used to perform tasks, organizations can identify opportunities to reduce the number of required steps and streamline processes. This can achieve better results with less costs and in less time. Productivity will vary based on organizational needs. Before outlining a Kaizen project, it helps to establish productivity metrics that can help your company gauge the success of improvements. 

Case In Point: Manor Tool

As metal stamping and fabrication company Manor Tool recounts on its blog, a customer needed a part with a soft edge. After the part was made, the operator used a wire wheel to deburr the edge by hand. By the end of the day, productivity would drop off steeply due to operator fatigue. Another operator would then have to countersink the part. Consequently, delays stacked up and productivity decreased all around.

The organization decided to lead a Kaizen event to improve the process. After the reorganization, the pieces first were countersunk and then moved to deburring. However, because one operator now did these tasks, there was a regular break during the wire wheel process that helped reduce the operator’s fatigue.

Leveraging Kaizen for Stronger Employee Engagement

A Jobvite study reports that 82% of employees are constantly looking for new job opportunities. And Gallup suggests that 87% of workers worldwide are disengaged from their work. It’s a staggering problem for companies that can lead to loss in productivity, knowledge and revenue. And it’s one more problem that a Kaizen culture can help solve.  

Kaizen emphasizes the value of the workforce as a company’s most important asset. Companies that effectively adapt the tenets of Kaizen empower employees at every level to make proactive changes where necessary. When Kaizen is applied consistently, employees think differently about their roles and their work. In short, it’s about building a culture where every worker is empowered to suggest or directly implement any improvement to the way things are done.  

By valuing people and working to develop their potential, you nudge them toward better engagement with their work. And the great thing about employee engagement is that it leaves workers more satisfied with their jobs.

Case In Point: HealthFirst Financial

HealthFirst Financial, a patient financing company, described in Becker’s Hospital Review a project in which it applied Kaizen to improve employee satisfaction. Under the original structure of its call center, employees had to be experts in every subject. That expectation proved overwhelming and frustrating for staff and consequently led to long customer wait times. So the team used Value Stream Mapping to identify ways to restructure the call center.  

Based on employee input, the company restructured the center so staff could focus on specific tasks. The project took three weeks to complete and led to major transformations, including a decrease in wait times by 300%, a tenfold decrease in call abandonment and minimization in errors in creating new accounts. Moreover, it led to happier employees. Not only are employees able to focus on what they do best, but they also can see that management values their happiness and their input.

How Kaizen Can Generate Cost Savings

As it turns out, focusing first on employees and customer satisfaction is good for business. When companies can increase productivity, reduce waste and limit employee turnover, they gain big benefits to their bottom-line. Often Kaizen events lead to across the board benefits that can translate into significant cost savings.

Case In Point: Metcam Inc.

As metal fabricator Metcam Inc. shared with TheFabricator.com, the organization has been able to improve the quality of its products and generate tremendous cost savings through its Kaizen initiatives. On one project for a large customer, the Kaizen team led a project to reorganize the assembly line into three different stations. In addition, they rearranged the storage racks to improve material flow. Through this change, the team was able to move from having 10 people on the line working overtime to eight people with no overtime, a tremendous cost saving. Moreover, the line saw increased throughput by up to 15 percent and reduced the error rate to near zero, leading to a higher quality product. The article notes that in some of its initiatives the company has been able to reduce time, costs or both by as high as 30 percent.

Next Steps

For More Information:

From the Center of Excellence: How Kaizen is Transforming Companies

From the Center of Excellence: Creating a Kaizen Culture

How Kaizen Method Can Improve Productivity

How Kaizen Can Improve Your Manufacturing Production Quality

Click here to learn more about Continuous Improvement.