2006 12 KAIZEN Forum KAIZEN I...

management of these companies doesnot even recognize that the productionsystem they are using is the cause oftheir problems. These include longthroughput times, high inventory levels,high labor costs, quality issues and alack of flexibility.The top management of such companieshas to wake up and recognize that it hasfailed to introduce the lean production

There are two typesof productionsystems: thetraditional productionsystem, which isbased on salesprojections andmanufactures inadvance, and thelean productionsystem, which onlyproduces the

products which the customer wants tohave at the time he wants to have them.

Sales forecasts are never reliable. Thisapplies today more than ever. In aglobally competitive environmentconditions are constantly changing.Companies, which manufactureaccording to the traditional productionsystem cannot react in a flexible way tomarket changes. According to myestimates 99.9 % of companies aroundthe world are stilling working with thetraditional production system. The

Production system as acause of issues

The structure defines theflexibility of a company

Gemba the most importantplace in the company

Reasons for success and failureon introducing KAIZEN

KAIZEN Diagnosis as orientationaid

Report KAIZEN CongressCongress 2006 Zug

Apply KAIZEN successfully

The structure defines theflexibility of a companyBy Masaaki Imai

Why can humans walk upright and apes cannot, although the skeletons are similar? It

is the differences in the bone structure, which allow us to walk in an upright position

whilst the ape has to move forward on all fours. It is similar within a company: waste-

free and flexible manufacturing without inventory is only possible if there are

structures available.

Structure defines mobility

system. Lean production is the onlyway to survive in the globally competitiveworld of the 21st century. Lean doesnot mean job cuts.On the contrary: only with waste-freeand flexible production job security canbe ensured long-term.Costs are obviously important. But thereshould be cost management instead of

TOPICS

INFORMATION EXCHANGE IDEAS. . Edition 06/2006

KAIZEN FORUM

Page 1

Continued on page 2Masaaki Imai, founder andchairman of theKAIZEN Institute

Humanskeleton:Lighter bonestructure,suitable forthe uprightposition.

Ape skeleton:Heavier bonestructure,strong pelvicand shoulderareas. Suitablefor moving onfour legs.

The five Gemba Principles

Page 2

cost cutting. Cost cutting relates tojob cuts and the purchase of cheapermaterials. I understand costmanagement to involve the optimizationof materials flow and the alignment andsynchronization of production speed.This creates the basis for flexible andwaste-free production within a cost-effective structure.KAIZEN provides methods and tools totransform the company step by step intoa lean organization. On introducingmethods such as 5S, Kanban or OnePiece Flow revolutionary changes cannotbe achieved. These partly implementedmeasures represent a small portion ofthe much larger picture. Many believethat KAIZEN only allows smallimprovements to occur and that a greatleap forward is not possible. But thecumulative effect of many small stepscan be dramatic improvement from astrategic perspective. It is a long termproject to change the bone structure of acompany.The KAIZEN philosophy can helptowards that aim. Shorter throughputtimes, a minimal waste, less inventoryand errors, arise from the change to alean production system. Those whowant to achieve success have to havestamina and discipline. KAIZEN workswith simple methods. Common sense isthe primary focus. It is important that topmanagement declares KAIZEN as a

Continued from page 1

corporate goal, completely supports itand encourages the workforce as wellsetting the targets in that direction.Decisions should not be made based oncomputer generated figures. Managersshould always observe the real elements(Jap. Gembutsu) where they are takingplace. That is where possible causes ofproblems can be found.

In Japanese Gemba means the placewhere events take place. We considerGemba to be the holiest place in the

Gemba is there wherethe corpse is found

company. This is where managersshould spend most of their time becausethis is the place where the most value isadded. Problems and irregularities canonly be analyzed and eliminated atGemba, not from the desk. Gemba isthere where the corpse is found! Orhave you seen that Detective Columbosolved a murder case from his desk?

The four cornerstones for a world classproduction system (see diagram on theleft) can be set up with KAIZENmethods. See problems as opportunitiesand let the KAIZEN spirit pervade allareas of the company.The idea has to come from topmanagement. The philosophy thencascades down like a waterfall. At thesame time some KAIZEN methods aresuitable for encouraging the KAIZENprocess in a bottom-up way. Theseinclude 5S, standardization,improvement ideas, and the waste hunt.

Current information under:

.www.kaizen.com

In the case of deviations and irregularities go firstto Gemba, the place where events take place

Take note of the real things, such as machines,materials, disturbances, leakages, security risks

Introduce preliminary measures immediately at theplace

Eliminate the cause of the problem

Create standards to prevent problems

The cornerstones of world class management

Total

Quality

Management

Total

Productive

Management

Total

Flow

Management

TQM TFMTPM

Total Service

Management

TSM

Quality costs Losses Flow, throughput time Customer satisfaction

KAIZEN only works if management is committed to the philosophy.Drive and encourage is the motto. Competency in methodology is thenecessary prerequisite for the successful implementation andcontinuation of the KAIZEN process. KAIZEN managers and processmanagers are the driving factors on site who coordinate theimprovement process and transfer their knowledge of the methods.Clear objective setting and timelines and monitoring with audits areadditional elements for sustained success.

Use common sense!

Elimination of errors

Stumbling blocks, do's anddont's in the KAIZENprocessToyota is a classic example to show theopportunities for success in applying theKAIZEN philosophy. Countlessmanagers have tried over the last twodecades to improve their companysituation with KAIZEN methods. Somewere successful and some failed. Here isan overview of some of the reasons forsuccess and failure with KAIZENmethods:

Efforts will only be successfullyrewarded if top management and allother managers drive the improvementprocess.

Clear objective setting with schedulesand regular monitoring of fulfillment inthe form of an audit dictates thedirection.The corporate goals need to begranulated down into divisional goalsand goals for the individual employees.Clear communication of the goals servesto motivate and guide staff.

Training is very important in theimprovement process. Only those whoknow methods can eliminate the source

Management does not reallysupport it:

Lack of objectives:

Employees do not know themethods:

Support from the top: Require, enable, empower

Page 3

It does not always have to be charts from the computer. Keeping youreyes open on site, a few handwritten drawings and the questioningtechnique '5 times why?' usually help in finding out the cause of theproblem and consistently improving the situation.

of problems. Process managers are ableto train colleagues and make themethodology known to a broader base.

There are no quick wins with KAIZENand it is not suitable for restructuringcompanies.The best way is to start whilst resourcesare still there. But the great steps take

Short term attitude:

effect in the mid-term, after about 5years.

It is not sufficient to simply copy the wayin which other companies, such asToyota, implement. Every companyneeds individual measures.The KAIZEN diagnosis (see page 4) issuitable for determining the rightmeasures.

Management decisions should be madein the light of the real situation and noton the basis of computer lists. What isreally happening can only be observed inthe place where events take place (seepage 2).

The financial situation of the company isevaluated and determined on the basisof the balance sheet. Management ismeasured by it. But objective criteria aremissing for the evaluation of theproduction system quality. Thesemeasuring criteria still have to bedeveloped.

Copy or understand?:

Management not at Gemba:

No objective criteria for the qualityof the production system:

IMPRINTPublisher:

KAIZEN Teaching AGBahnhofplatz6300 Zug, SwitzerlandTel. +41 41 7 25 42 - 80Fax +41 41 7 25 42 - 89info@kaizen.comEditorial: Sabine Leikep

Get the expertise for TPM ,Total Service Management,Value Stream Design andTotal Flow Management.

Train later to become aKAIZEN Manager.

Learn from the best on ourbenchmark tour.

More information, dates andprices are available on our

service hotline:

+41 41 725 42 84

KAIZEN Diagnosis as orientation aid

That means that the entire value chainfrom top management to suppliers isinvolved. The best practice expertsshowed examples of how they havesuccessfully paved their way to the leanproduction and the lean office. Thehighlight of the congress was the twoworks tours which were conducted inparallel. At the Sika Schweiz AG in Zurichit was possible to see the advancedimplementation of the 5S principles. Thevisitors to TRUMPF Maschinen AG inBaar were able to see TRUMPF's ownSYNCHRO production system, whichworks in a process oriented way. Thenext KAIZEN Congress will take placefrom 27th-29th November, 2007 inMunich.Information under www.kaizen.com.

KAIZEN Congress 2006 in Zug

The Lean Offensive

Being lean that should be the aim ofall companies. But that does not meanjob cuts. It means getting rid of inventoryand it means flexible production withshort throughput times. Masaaki Imaiemphasized that in his presentation atthe Kaizen Congress which was held inZug by the Management Circle. KAIZENis often translated with continuousimprovement. But that is not enough forthe KAIZEN guru from Japan. For himKAIZEN means improvement every day,everywhere and for everyone.

Page 4

Where is your production system? With the KAIZEN Management Auditwe provide you with a diagnostic tool which shows where there is anacute need for action.Our consultants go with management to Gemba to evaluate thesituation. Together a roadmap is generated which shows the way towaste-free working.The entire value flow from administration to delivery is observed.We show you possibilities and you decide on the goals and focus.

Preview

New book by Masaaki Imaito be published in 2007

Masaaki Imai has captured muchattention in the last 20 years with hisbestsellers KAIZEN and GembaKAIZEN. Many companies have sincegot involved with KAIZEN. But only afew are really successful.Masaaki Imai has also accompaniedmany companies on their way toKAIZEN. In his next book he addressesthese experiences and outlines how aproduction system can be successfullytransformed with KAIZEN methods. Thenew book is due to be published at theend of 2007.

Happy faces after a successful event:Udo Reimer, Masaaki Imai, and ChristianBarthololmay at the KAIZEN Congress inZug.

Operations Manager Hans Rickenbacher(right) leads a group of visitors throughthe TRUMPF works in Baar/CH.

/ColorImageDict > /JPEG2000ColorACSImageDict > /JPEG2000ColorImageDict > /AntiAliasGrayImages false /DownsampleGrayImages true /GrayImageDownsampleType /Bicubic /GrayImageResolution 300 /GrayImageDepth -1 /GrayImageDownsampleThreshold 1.50000 /EncodeGrayImages true /GrayImageFilter /DCTEncode /AutoFilterGrayImages true /GrayImageAutoFilterStrategy /JPEG /GrayACSImageDict > /GrayImageDict > /JPEG2000GrayACSImageDict > /JPEG2000GrayImageDict > /AntiAliasMonoImages false /DownsampleMonoImages true /MonoImageDownsampleType /Bicubic /MonoImageResolution 1200 /MonoImageDepth -1 /MonoImageDownsampleThreshold 1.50000 /EncodeMonoImages true /MonoImageFilter /CCITTFaxEncode /MonoImageDict > /AllowPSXObjects false /PDFX1aCheck false /PDFX3Check false /PDFXCompliantPDFOnly false /PDFXNoTrimBoxError true /PDFXTrimBoxToMediaBoxOffset [ 0.00000 0.00000 0.00000 0.00000 ] /PDFXSetBleedBoxToMediaBox true /PDFXBleedBoxToTrimBoxOffset [ 0.00000 0.00000 0.00000 0.00000 ] /PDFXOutputIntentProfile () /PDFXOutputCondition () /PDFXRegistryName (http://www.color.org) /PDFXTrapped /Unknown

/Description >>> setdistillerparams> setpagedevice