Sony & Taj Hotel : Kaizen in Japan

Written By: Yogin Vora on February 24, 2009 9 Comments INTRODUCTION Japanese term that means continuous improvement, taken from words Kai means continuous and Zen means improvement. Some translate Kai to mean change and Zen to mean good, or for the better. The same japanese words Kaizen that pronounce as Gai San in chinese means; Gai= The action to correct. San= This word is more related to the Taoism or Buddhism Philosophy in which give the definition as the action that benefit the society but not to one particular individual. The quality of benefit that involve here should be sustain forever, in other words the san is and act that truly benefit the others. Kaizen was created in Japan following World War II. The word Kaizen means continuous improvement. It comes from the Japanese words Kai meaning school and Zen meaning wisdom. Kaizen is a system that involves every employee from upper management to the cleaning crew. Everyone is encouraged to come up with small improvement suggestions on a regular basis. This is not a once a year, or monthly activity. It is continuous. At Japanese companies, such as Toyota and Canon, 60 to 70 suggestions per employee, per year are written down, shared and implemented. In most cases these are not ideas for major changes. Kaizen is based on making little changes on a regular basisalways improving productivity, safety and effectiveness, and reducing waste. Suggestions are not limited to a specific area such as production or marketing. Kaizen is based on making changes anywhere that improvements can be made. The Kaizen philosophy is to do it better, make it better, and improve it even if it isnt broke, because if we dont, we cant compete with those who do. Western philosophy can be summarized as, if it isnt broke, dont fix it. The Kaizen philosophy is that everything, even it isnt broke can be improved. Kaizen is a system of improvement that in Japan includes both home life as well as business improvements. Kaizen even includes social activities. It is a concept that is applied in every aspect of a persons life.

In business Kaizen encompasses many of the components of Japanese businesses that have been seen as a part of their success. Quality circles, automation, suggestion systems, just-in-time delivery, kanban and 5S are all included within the Kaizen system of running a business. Kaizen involves setting standards and then continually improving those standards. To support the higher standards Kaizen also involves providing the training, materials and supervision that is needed for employees to achieve the higher standards and maintain their ability to meet those standards on an on-going basis. Kaizen often takes place one small step at a time, hence the English translation: continuous improvement, or continual improvement. Yet radical changes for the sake of goals such as just in time, and moving lines also gain the full support of upper level management. Goals for kaizen workshops are intentionally set very high because there are countless examples of drastic reductions in process lead time to serve as proof of their practicality. The cycle of kaizen activity can be defined as: standardize an operation -> measure the standardized operation (find cycle time and amount of in-process inventory) -> gauge measurements against requirements -> innovate to meet requirements and increase productivity -> standardize the new, improved operations -> continue cycle ad infinitum. Learn-by-Doings The Zen in Kaizen emphasizes the learn-by-doing aspect of improving production. This philosophy is focused in a different direction from the command-and-control improvement programs of the mid-20th century. Kaizen methodology includes making changes and looking at the results, then adjusting. Large-scale preplanning and extensive project scheduling are replaced by smaller experiments in improvement, which can be rapidly adapted as new improvements are suggested.

PRINCIPLES OF KAIZEN There are certain basic principles which are followed in various Japanese companies which are listed below: 1. Focus on customers: -The Kaizen philosophy has only one prime objective of customers satisfaction. Kaizen permits no middle ground its either you provide best products and customer satisfaction or not. All the activities should aim at providing customer with whatever he wants and should help the firms long term objective of customers satisfaction at the same time building up good relationship. It is a responsibility of each and every person working in a Kaizen company to make sure that the product is upto the mark and it satisfies customers need.

2. Make improvements continuously: There is not a best way to do a thing, there is still a better way. In a Kaizen company, the search for excellence just does not end. We should work on the improvement implemented and see if we can make it even more effective. 3. Acknowledge problems openly: Every company has certain problems related to finance, competition, change in demand etc. Kaizen companies are no exception, but by fostering an appropriately supportive, constructive culture it becomes easier for any team to get its problem in the open. The whole organization works as a team to solve the problem. The problems are openly shared by the management with the employees which avoids rumors. It simply means FIGHT WITH YOUR PROBLEMS DONT RUN AWAY FROM THEM. 4. Promote openness: There seems to be less functional ring fencing i.e. only the senior managers have private cabins. Otherwise the workplace is generally open and in many companies even the dress code and canteen for everyone is the same. 5. Create work teams: Each individual in a Kaizen company belongs to work team headed by a leader. Working in various overlapping teams draws employees into corporate life and reinforces the mutual understanding. 6. Cross- functional teams: kaizen states that no individual or team has all the required skill and knowledge to complete a task. Cross-functional teams help in getting all the valuable informations from the view of all the related people. It calls for letting ideas to flow as wide as running on moon. 7. Right relationship process: This principle can be explained in one word as harmony. Harmony means a complete mixture of the best process and also the best results. 8. Develop self-discipline: The most important evidence of existence of Kaizen in a company is the level of self-discipline in an employee. 9. Inform every employee: Kaizen requires all the staff to be given all the information at the time of their induction and throughout their working tenure. This is very important to make sure that the employees have the right attitude and also that they respect their culture and help their co-workers. 10. Enable every employee: Enabling employees gives those skills and opportunity to apply the information provided. In a Kaizen company it is also important to give employees adequate training to sharpen their skills and also incentives should be provided. In case where a workers suggestion is implemented he should be given rewards.

IMPORTANCE OF KAIZEN To answer this question let us first see what does Kaizen do or what are the benefits of Kaizen. The details of the same are follow: Kaizen involves every employee in making changein most cases small, incremental changes. It focuses on identifying problems at their source, solving them at their source, and changing standards to ensure the problem stays solved. Its not unusual for Kaizen to result in 25 to 30 suggestions per employee, per year, and to have bovver 90% of those implemented. For example, Toyota is well-known as one of the leaders in using Kaizen. In 1999 at one U.S. plant, 7,000 Toyota employees submitted over 75,000 suggestions, of which 99% were implemented. These continual small improvements add up to major benefits. They result in improved productivity, improved quality, better safety, faster delivery, lower costs, and greater customer satisfaction. On top of these benefits to the company, employees working in Kaizen-based companies generally find work to be easier and more enjoyableresulting in higher employee moral and job satisfaction, and lower turn-over. With every employee looking for ways to make improvements, you can expect results such as:

Kaizen Reduces Waste in areas such as inventory, waiting times, transportation, worker motion, employees skills, over production, excess quality and in processes. Kaizen Improves space utilization, product quality, use of capital, communications, production capacity and employee retention. Kaizen Provides immediate results. Instead of focusing on large, capital intensive improvements, Kaizen focuses on creative investments that continually solve large numbers of small problems. Large, capital projects and major changes will still be needed, and Kaizen will also improve the capital projects process, but the real power of Kaizen is in the on-going process of continually making small improvements that improve processes and reduce waste.

To add to all this we would further like to add the following: Kaizen closely associated with quality, quality refers to meeting specification and requirement, competitive cost and reliability, customer satisfaction, safety, consistency and so on. Kaizen signifies small improvement made in the status quo as a result of large investment. The word Kaizen refers to small and continuous improvement. The wider meaning is continuous improvement consistently, every time, every step, every place leading to self development and hereby neighbourhood development. The kaizen philosophy is based on our life; our working life, our social life or our home life needs to be constantly improved for the betterment.

In a management sense this means continual & gradual improvements through evolution rather than revolution. The reality is you can make improvements once if you try; you can make them more than once if you care. Bad business ignores the sign of disaster. Good business spots the sign of disaster and deals with them. KAIZEN business constantly reviews and monitors to preclude disaster. To finish we would like to say that CHANGE IS THE NEED FOR THE HOUR, but this change is not easy. To implement these changes is not easy and to shed light on how Kaizen helps companies excel we have chosen this topic. HISTORY OF KAIZEN The history of this philosophy can be traced to as back as 1950s. Although the term KAIZEN first became apparent in the west in the mid 1980s, its roots lie in the aftermath of the Second World War. The birth of Kaizen as a management concept is closely bound up with Japans recovery & growth after world war-II, as a management concept, however it was first used in 1970 within post-war Japan there was clearly a pressing need to make manufacturing industry efficient, this led some of the major manufacturer ways to build on the ways of the team structures in their companies & to harness the full contribution of their system, became increasingly common. Then in 1986, Masaaki Imai published his influential book entitled Kaizen: the key to Japans key to success in which he showed a number of companies were successfully using this ideas in an integrated way : kaizen as a management concept had been born. The Global economic situations which lead to evolution of KAIZEN as an important management tool are:

Sharp increases in the cost of material, energy, labour. Overcapacity of production facilities. Increased competition in already saturated market. Changing consumer values. A need to have a lower breakeven point.

The traditional Japanese approach to Kaizen embeds it in a hierarchical structure, although it gives considerable importance to the employees as well, but within fixed limits. The key to applying this principle in practice the main points to be considered are:

Attention to process, rather than end results. Cross-functional management. Use of QCs and other tools to improve communication.

Japanese organizations over the years have applied this philosophy and have reaped huge benefits. Unlike in the West where the emphasis is on one goal that is profit , in Japan the motto is to produce something in the best possible manner and in the process if possible

try for profits. They have over the period put more stress on research and development to improve the existing process and make it more productive and also satisfy high quality standards. Japanese organizations believe its better to continuously improve the process rather than to go for innovations. According to theory its great strength of the Japanese companies to pay attention on the process rather than the results. A NOTE ON WHY KAIZEN WORKED IN JAPAN The essence of implementing Kaizen is the attitude & it is the attitude of the Japanese people (now known as Kaizen Attitude) that helped them in implementing Kaizen successfully. Many of Japanese people by nature are hardworking, attentive ,training oriented and most importantly they feel a strong obligation to be responsible for their work. This is one of the basic reasons of success of kaizen philosophy in Japan. The following examples would throw light on the above mentioned point:WESTERN ATTITUDE: As long as the targets are met dont interfere KAIZEN ATTITUDE: -Dont aim for perfection it isnt good enough WESTERN ATTITUDE: Its a Marketing problem not a production one right KAIZEN ATTITUDE: -There is a problem here; lets see what we can do about it GEMBA-KAIZEN In the service sectors, GEMBA is where the customers come into contact with the services offered. At banks, tellers are working in Gemba, as are loan officers receiving applicants. The same goes for employees working desks in offices and for telephone operators sitting in front of switchboards. Thus, Gemba spans a multitude of offices and administrative functions. The efforts to bring about sales management in cooperative banks take place in Gemba. Hence a few more lines on Gemba will be in order. The problem with most managers is that they prefer their desk as their workplace, wish to distance themselves from the events taking place in Gemba. Most managers come into contact with reality only through their daily, weekly or even monthly reports, or other meetings. (Masaaki, Imai: Gemba Kaizen. The Japanese word KAIZEN is now well known on the floors of factories all over the world. It is written with the two kanji characters at left. KAI means alter, renew, reform,

or to be corrected, among other meanings, and ZEN means simply good (The Kanji Dictionary, Spahn & Hadamitzky). In everyday Japanese, KAIZEN means improvement. For people in factories, though, KAIZEN means a lot more than that. It means the relentless process of finding and eliminating MUDA (or waste). That KAIZEN is sometimes translated in English as Continuous Improvement, because experts felt that saying merely improvement gave the wrong impression. MUDA is everywhere. Eliminate it and you will find it in new places. And so KAIZEN is endless. In the field of sales management in cooperative banks, managers first priority should be to go to Gemba and observe. Gemba is your teacher. When you go to Gemba, what you see is the real data. The report from Gemba you read sitting at your desk is merely secondary information. There is a golden rule of Gemba management, the 5-Gemba principles, which can be described as follows:

is

why

When a trouble (abnormality) happens, go to Gemba first. This is the first and most important principle. Many managers learn about the problems that happened in Gemba from a report that reaches them several days or weeks after. The best solution is to go to Gemba at once when you hear that a problem has happened. Check with gembutsu (machines, tools, rejects, and customer complaints.) Gembutsu, another Japanese word means some tangible things on which you can put your hands on. If a machine is down, the machine itself is gembutsu. If a customer is complaining, the customer is gembutsu. For instance, if the

machine is down, go to Gemba and have a good look at the machine. By looking at the machine, and asking the question why several times, you can probably find out the reason for the breakdown on the spot.

Take temporary countermeasures on the spot. For instance, if the machine is down, you have to get it started because the show must go on. Sometimes you kick the machine to get it started. If a customer is angry, you will need to apologize, or even give some gift to appease. But these are only temporary measures and do not address the real issue, which leads to the next point. Find out the root cause. By repeating the question why several times, you can find out the root cause of the problem.

Standardize for prevention of recurrence. Once you identify the root cause, and come up with a countermeasure, you should standardize such a countermeasure so that the same problem will not recur.

What is GEMBA-KAIZEN?

Gemba-Kaizen is a work discipline that pretends getting the required information for improvement, directly where the phenomenon is produced. . To solve a problem you have to go to Gemba or work place, machine, plant area, that is, to the place where the event that prevents things from working properly is occurring. So what is Gemba Kaizen? Its a philosophy that uses small, continuous and commonsensical improvements in the workplace to save money and enhance the bottomline instead of heavy investments in new technology. For Masaaki, Gemba contains the root of all problems, solutions and is the source of all improvements and revenues. In order to solve problems found in Gemba, todays managers often try to apply sophisticated tools and technologies to deal with problems that can be solved with a commonsense, low cost approach. They need to unlearn the habit of trying ever-more sophisticated technologies to solve everyday problems. There are two approaches to problem solving. The first involves innovation applying the latest high-cost technology, such as state-of-the art computers and other tools, and investing a great deal of money. The second uses commonsense tools, checklists, and techniques that do not cost much money. THE 3 MUS OF KAIZEN

1. Eliminate Muda
Muda means waste and muda elimination in the context of kaizen implies an on going and systematic elimination of waste. Seven kinds of muda elimination are;

Muda over production Muda of stock Muda of transport Muda of defects Muda of delays Muda of motion Muda of over processing

1. MURA Mura = Inconsistencies in the system

Happens sometimes Happens some places Happens to some people One side is ok; the other side is not ok

All this is Mura 1. Muri

Muri = Physical Strain

Bend to work Push hard Lift weight Repeat tiring action Wasteful walk

All this is Muri FIVE WS AND ONE H CHECKLIST FOR KAIZEN

Who? Why? What? Where? When? How?

The Five Ws and H, are an influential, inspirational and imaginative checklist (often used by journalists). The technique uses basic question generating prompts provided by the English language. The method is useful at any level from a formal checklist to complete informality. For example:

Informal back-of-an-envelope use is suitable as a quick-aide checklist, a private checklist to keep in mind when in an on going discussion, quick points scribbled down in a meeting, or to generate further questions. To generate data-gathering questions, during the early stages of problem solving when you are gathering data, the checklist can be useful either as an informal or systematic way of generating lists of question that you can try to find answers for. To generate idea-provoking questions, whilst brainstorming, brain writing or some other such similar technique, the checklist could be used as a source of thought provoking questions to help build on existing ideas. To generate criteria, the checklist could help in generating criteria for evaluating options. To check plans, the checklist is a useful tool for planning implementation strategies.

However, the question words owe their strength to their fundamental place in the English language, and can conceal some of the assets of nature that our language copes less well with. The responses to the questions in the checklist are usually facts, rather than actions or problems. TEN COMMANDMENTS OF KAIZEN: 10. Though shall not speak falsehoods about thy modifications.

09. 08. 07. 06. 05. 04. 03. 02. 01.

Though shall not embark in any illegal activity Though shall not belittle another members ride. Though shall not monopolize the group. Though shall not deviate from Kaizen doctrine and code. Though shall never criticize a members final decision Though shall not take out stress on thy ride or the group. Though shall not totally rip-off another rides design Though shall not risk thy car recklessly. Though shall not strut.

ADVANTAGES & DISADVANTAGES OF KAIZEN

ADVANTAGES 1. Efficiency:- It leads to better efficiency in terms of through put time, inventory turnover, man hours employed, plant and machinery. 1. Continuous improvement: Kaizen philosophy stresses on continuous improvement rather than innovation. This process leads to better utilization of R & D resources of a company and better productivity. 1. Mutual understanding:- Due to the openness in a Kaizen company, mutual understanding among the employees increases along with better understanding with management. 1. Develop self -discipline: The philosophy stresses that all the employees in a Kaizen company should have selfdiscipline. This helps the top level management to set an example for the others to follow. This helps the management in improving their leadership skills as well as the companies practices are percolated through out the organization.

1. Participative Management: Due to the openness in the working environment and also in the management decisions the employees feel themselves to be a part of the organization. Participative Management also leads to a high employee morale. DISADVANTAGES 1. It is difficult to achieve kaizen in practice, because it requires a complete change in attitude and culture, and needs the energy and commitment of all employees. It also requires a substantial investment of time. 1. It is difficult to maintain enthusiasm for several reasons: 2. Some people see Kaizen as a threat to their jobs; 3. A lot of poor ideas tend to be put forward as well as good ones, which can be demotivating; 4. By implication, there is complete satisfaction. 1. Continuous improvement is not sufficient on its own, major innovations are also needed. There is a danger of becoming evolutionary rather than revolutionary. KAIZEN & THE FIVE Ss The Five Ss, or just 5S , is the name for a Japanese system of workplace cleaning and organization. It first appeared at Toyota Motor Company shortly after the end of World War II by the ideas of Taiichi Ohno, and is considered a vital part of the Toyota Production System and Lean Production philosophy. The Japanese have long recognized the vital importance of workplace housekeeping. The Five Ss are: 1. Seiri, which can be translated as sorting, refers to the practice of sorting through all the tools, materials, etc., in the work area and keeping only essential items. Everything else is stored or discarded. This leads to fewer hazards and less clutter to interfere with productive work. 2. Seiton, or organizing, focuses on the need for an orderly workplace. Tools, equipment, and materials must be systematically arranged for the easiest and most efficient access. There must be a place for everything, and everything must be at its place. 3. Seiso, which means cleaning, indicates the need to keep the workplace clean as well as neat. Cleaning in Japanese companies is a daily activity. At the end of each shift, the work area is cleaned up and everything is restored to its place. 4. Seiketsu, or standardizing, allows for control and consistency. Basic housekeeping standards apply everywhere in the facility. Everyone knows exactly what his or her responsibilities are. House keeping duties are part of regular work routines.

5. Shitsuke, which means sustaining, refers to maintaining housekeeping standards and keeping the facility in safe and efficient order day after day, year after year. Managements Role in Implementing Kaizen Introduction of Kaizen involves considerably more sweeping changes in attitudes, structures and processes. Senior managers need to think about the impact and implications of kaizen, as well as about the practicalities of introduction. In particular. Senior management commitment is essential Senior managers must be aware of Kaizens role in the overall business strategy. All employees should understand Kaizens role in their work. Kaizen should be linked to personal development and enablement In Japan, cultural background means that senior management commitment can be taken for granted. Local guidelines therefore concentrate on the shop floor involvement. In the UK, where the cultural background is different, the right management commitment is essential. Senior managers need to understand Kaizen and how it fits into the organizations overall business strategy. They should be aware of implications and potential disruptions that the introduction of Kaizen might bring.

Reorganization of people into teams takes time and may be disruptive Training and group meeting take additional time Productivity may decline temporarily while changes are implemented Some employees may be suspicious and un co-operative

Above all senior managers must be prepared to let go of some areas of power: Kaizen in practice is based on the belief that the people doing a particular job will often know how better than anyone else (including their supervisors) how that job can be improved, and that they should be given that responsibility for making those improvements. Management needs to be prepared- mentally as well as practically for this shift. Once Kaizen practices were identified as a key element in the success of large Japanese manufacturers such as Toyota, they began to take interest in the philosophy and practice of these companies. They believed that Kaizen:

Leads to reduction of waste Can increase productivity by at lest 30 % where no previous improvement process was in place Is relative cheap to introduce it requires no major capital investment

Can lower the break-even point Enables organization to react quickly to market changes

DIFFICULTIES IN IMPLEMENTING KAIZEN

Overcoming Middle Management resistance: In very many countries due to the over dominance of the middle level management, the middle level feel threatened that their role will be eliminated. The change infact would help the managers to know the daily routine, help to give away more responsibility. In many cases where Kaizen was introduced after some of the managers took work they wanted reassurance that there would be no redundancy. Overcoming union fears: Again in case of a company which adopts Kaizen and has a strong union has to

change from its traditional approach to a more modern one. Infact in a Kaizen company, due to an open environment there are hardly any mismatch. The aim of a union is workers welfare which can be fulfilled in case of an open environment. Some of the argument that the union voice on are : v Employees have to work for more whereas the benefits are not substantial. v Older employees are edged out by younger ones. v Employees tend to work for themselves rather than the job.

Time lapse: In case of very many companies the time taken to get used to this new Kaizen philosophy is very high. It is very difficult to change the attitude of the employees, their belief, and the culture that has developed over a period of time. It requires a lot of training as well as a lot of positive communication to spread the new philosophy. Maintaining the momentum: Kaizen stresses on continuous improvement. In many cases due to slowdown of economies, financial problems, etc sometimes its difficult to keep working on R&D and improve the processes.

TOOLS USED FOR KAIZEN KAIZEN achieves its effects by working through people. All are expected to be involved. Managers, for example, are expected to spend about half their time on improving what they and those for whom they are responsible do. Traditionally, a Japanese Samurai carried seven tools into battle. After World War II the Japanese adopted quality as a philosophy for economic recovery and, in line with this traditional approach, sought seven tools to accomplish the economic rejuvenation. The seven tools chosen were:

Histograms Cause and Effect Diagrams Check Sheets Pareto Diagrams Graphs Control Charts Scatter Diagrams

1. Histograms A histogram is a specialized type of bar chart. Individual data points are grouped together in classes, so that you can get an idea of how frequently data in each class occur in the data set. High bars indicate more points in a class, and low bars indicate fewer points. In the histogram show above, the peak is in the 40-49 class, where there are four points. 2. Cause and Effect diagrams The cause & effect diagram is the brainchild of Kaoru Ishikawa, who pioneered quality management processes in the Kawasaki shipyards, and in the process became one of the founding fathers of modern management. The cause and effect diagram is used to explore all the potential or real causes (or inputs) that result in a single effect (or output). Causes are arranged according to their level of importance or detail, resulting in a depiction of relationships and hierarchy of events. This can help you search for root causes, identify areas where there may be problems, and compare the relative importance of Pareto Charts.

3. Check Sheet
The Check Sheet is a simple but powerful data gathering tool. It is used to gather and classify information (data) that can be easily analyzed to identify patterns in the work being studied. It starts the process of translating opinions to facts. A Check Sheet is useful for:

Making data gathering easy. Learning the extent of a problem Count to know. Arranging data so it can be easily used to construct a Pareto Chart. Identifying causes of problems.

1. 4. PARETO DIAGRAM Vilfredo Pareto, a turn-of-the-century Italian economist, studied the distributions of wealth in different countries, concluding that a fairly consistent minority about 20% of people controlled the large majority about 80% of a societys wealth. This same distribution has been observed in other areas and has been termed the Pareto effect.The

Pareto effect even operates in quality improvement: 80% of problems usually stem from 20% of the causes. Pareto charts are used to display the Pareto principle in action, arranging data so that the few vital factors that are causing most of the problems reveal themselves. Concentrating improvement efforts on these few will have a greater impact and be more cost-effective than undirected efforts. 5. GRAPHS Charts and graphs are images that represent data symbolically. They are used to present complex information and numerical data in a simple, compact format. Some types of charts and graphs, known as pictographs, use pictures or symbols in place of the typical bars, lines, or dots of most graphs. Examples: A pie chart is a circle divided into segments with each piece of the pie representing some data. Bar and stacked charts use vertical or horizontal bars to show the relationship between numbers. Line charts use lines along a visible or invisible grid 5.CONTROL CHARTS Every process varies. If you write your name ten times, your signatures will all be similar, but no two signatures will be exactly alike. There is an inherent variation, but it varies between predictable limits. If, as you are signing your name, someone bumps your elbow, you get an unusual variation due to what is called a special cause. If you are cutting diamonds, and someone bumps your elbow, the special cause can be expensive. For many, many processes, it is important to notice special causes of variation as soon as they occur. 1. 6. SCATTER PLOTS Scatter Plots (also called scatter diagrams) are used to investigate the possible relationship between two variables that both relate to the same event. A straight line of best fit (using the least squares method) is often included. Things to look for:

If the points cluster in a band running from lower left to upper right, there is a positive correlation (if x increases, y increases). If the points cluster in a band from upper left to lower right, there is a negative correlation (if x increases, y decreases). Imagine drawing a straight line or curve through the data so that it fits as well as possible. The more the points cluster closely around the imaginary line of best fit, the stronger the relationship that exists between the two variables.

CASE-STUDIES Kaizen & Sony

An operation at a plant in Terre Haute, Indiana, that required 13 operators to produce 369 products per man-hour, cut labor needs to only three operators while boosting throughput to 2,715 products per man-hour in just over one year. The products are compact discs for the Sony video game. The plant is one of the Sony Disc Manufacturing facilities in the United States. The boost in production was made through automation, attrition and attention to the principle of Kaizen, the Japanese word for continuous improvement. Its a process that involves everyone in the plant, from equipment operators to department managers working together. Success is achieved without layoffs. Allegiance to the Kaizen principle has allowed the Terre Haute facility, the first CD manufacturing plant in the U.S., which Sony purchased from CBS in 1983, to move from the then unthinkable goal of producing 300,000 CDs per month to todays capability to turn out 27 million CDs per month. In a crunch, the plant can produce more than 29 million CDs as it did in October 1999. Kaizen is a team concept that means continuous and incremental improvement at all levels: machine operators, middle manager and even the CEO are part of the process. The Kaizen umbrella covers just-in-time inventory, zero defects, quality circles and suggestion systems. Basically, you take a look at your operations and you eliminate everything thats wasteful. Waste, known as muda in Japanese, is everything that does not add value. Muda is the deadly enemy of value creation. The eight deadly muda are: 1. 2. 3. 4. 5. 6. 7. 8. Waste of motion Time delays Unnecessary transporting and material handling Making defects Over processing Over producing Storing inventory Missed opportunity

If you can drive that kind of waste out of your process and stay vigilant about it, then youve reached the heart of Kaizen. Heres where the art of standardization becomes your friend. You have to rigorously standardize your processes if you are going to rigorously improve them. Maintaining your best processes and improving them involves two key activities, what we call two-cycle wheels. The first cycle is for maintaining your best processes, which is the day-to-day concern of operators and technicians. The other is the improvement cycle, which is generally the responsibility of the management and engineering staffs. Management and technical staff have the lead responsibility for improvements in the standardization processes. But they dont act in a vacuum. They spend the majority of

their time on the factory floor, measuring compliance with the Kaizen-driven plan, looking at the manufacturing process from the individual perspective of each employee. With the emphasis on automation, cycle time on the CD lines has been drastically driven down in this process. Gone, for example, are the batch process lines of the late 1980s. The Terre Haute plant makes discs faster than anybody in the world. It does so with fewer employees. Yet the company has not laid off any workers. The head count has dropped from a high of about 1,500 employees to its current status of just under 1,000 all through attrition. Kaizen improves the morale of employees by removing drudgery from work and developing pride in seeing individual ideas implemented. Automatic guided vehicles carry supplies and discs from one station to another. Everything is automated from retrieving manufacturing supplies to the manufacturing process itself, even the stacking of packed boxes of discs on a pallet for shipping. The improvement to the video game cartooning line typifies the success of the program. The video game system launched by Sony in the mid-1990s has quickly become a staple product for the plant, particularly during the second half of each year. Discs for the game can account for nearly half the CDs made at Terre Haute during the late summer and early fall. To start the process, a team of 17 from the plant director of production operations to seven packaging operators was assembled to examine the operation and identify problems. With the operation shut down, the team discussed problems that they identified and added the concerns of team members. The team developed a list of 34 steps in station operation that could be improved, from e-stop location to the labeler. At its next meeting, the team generated possible solutions for each of the issues. The problems were categorized based on their impact on the operation. Then the list was divided into low cost, quick fixes and engineering improvements. Every suggestion for improvement had to consolidate, automate, eliminate or simplify in order to be considered. The objective was to make the process more efficient and the job easier for the operators as quickly as possible without investing much money. Within days, low-cost improvements were implemented. During the process, all the improvements were identified in Kaizen story boards that tell the story of this specific continuous improvement and give credit to the team participants. These Story Boards, with the names of all participants, are displayed near the line and updated periodically. Here are some of the simple and incremental improvements that were accomplished within weeks and which reduced the number of station operators from 13 to seven, while

raising standard throughput from 4,800 to 8,679 and the number of discs per man-hour from 369 to 1,240:

Relocated e-stop Added rollers to prevent jams and disorientation Redesign of crank on taping machine Replaced cylinders on stacker Eliminated reaching by reconfiguring work station height Added flap detection sensor Added quick-change tape head

To supplement these physical alterations, there was additional training for the core team and reorganization for easier access of the technical manuals. Once these changes and improvements were accomplished, the team moved on to identify and accomplish further incremental improvements in the station operation. Within eight months, engineering and automation improvements that the team identified had been installed by engineering to reduce the number of operators needed at the video game cartooning line to four, while increasing the standard throughput to 9,242 and the discs per man-hour to 2,311. These productivity improvements were accomplished with semi-automatic master and automatic master cartooning, a new roll stock labeling system, an automated tote handling system and installation of a new semi-automatic line. Even that was not the end. By mid 1999, only three operators were needed to improve discs per-man-hour to 2,715. Implementation of a robotic palletizer increased throughput eliminated two operators and overcame ergonomic issues involved in the operators need to be constantly bending. Savings: $118,400 annually, with a payoff period of only 26 months. Ergonomic issues were at the heart of a decision to add a master carton loader that automatically loaded three inner cartons of product into a master carton and placed the carton on a conveyor to be palletized. Savings: one person per line, per shift or $118,400 per year. Payoff period: 14 months. Two operators were required to load PSX products from totes into PSX cartons. The manual labor and the inherent ergonomic problems were eliminated by the installation of an automatic tote de-stacker. By eliminating the two operators, the unit realized annual savings of $236,800 with a payoff period of 5.1 months. Lessons Learned The Kaizen total involvement approach to improvements follows a set of rules, policies, directives and procedures established by management. The four basic steps in making continual improvement involve: Plan, Do, Check, Act. To maintain the improved states we Standardize, Do, Check Standardization. One of the foundations of plant Kaizen activities means documentation of the best way to do the job.

Any manufacturing operation can benefit from Kaizen as long as there is a commitment from management toward total involvement in basic Kaizen tenets:

Discard conventional, fixed ideas Think of how to do it, not why it cannot be done Do not make excuses. Start by questioning current practices Ask why five times to realize the root cause of a problem

Sony Disc Manufacturing has made that commitment and has reaped the rewards, enabling the company to keep up with growing demand for our product while cutting costs. KAIZEN AT TAJ HOTELS INDIA The Hotel Taj President, Mumbai part of the Rs 687 crore Indian Hotels Corporation Ltd (IHCL) recently witnessed a peculiar problem at its main kitchen. Breakages in the main kitchen were high due to incorrect flow of cutlery and crockery during washing. The Konkan Cafe and the Thai Kitchen, two restaurants at Taj President, were also facing problems due to the depth of the sink and mixing up of metal and chinaware. The hotel decided to set up a Kaizen team comprising Chef Ananda Solomon, Rajkishore Mahto and Wilfred Rebello who immediately sprung into action. The team studied the problem and set about to rectify it. The system of one piece at a time into the dishwasher was implemented. The layout of the dishwashing area was changed to facilitate single-piece flow. Seemingly frivolous? But the result: The breakage of crockery came down by 28 per cent. Savings from the stoppage of breakages are at Rs 6 lakh per annum. In the main kitchen, gains are around Rs 1.75 lakh per annum and in the Konkan Cafe and Thai Kitchen, the gains are around Rs 2 lakh each. This is not a one-off incident at the Taj group. Over the past two years, the group has institutionalised both the Kaizen approach and the Total Productivity Maintenance (TPM) approach, says IHCL senior vice-president (corporate quality), Mr HN Shrinivas. Conclusion Kaizen involves every employee in making changein most cases small, incremental changes. It focuses on identifying problems at their source, solving them at their source, and changing standards to ensure the problem stays solved. Its not unusual for Kaizen to result in 25 to 30 suggestions per employee, per year, and to have over 90% of those implemented. For example, Toyota is well-known as one of the leaders in using Kaizen. In 1999 at one U.S. plant, 7,000 Toyota employees submitted over 75,000 suggestions, of which 99% were implemented. These continual small improvements add up to major benefits. They result in improved productivity, improved quality, better safety, faster delivery, lower costs, and greater

customer satisfaction. On top of these benefits to the company, employees working in Kaizen-based companies generally find work to be easier and more enjoyableresulting in higher employee moral and job satisfaction, and lower turn-over. Kaizen is often translated in the west as ongoing, continuous improvement. Some authors explain Japans competitive success in the world market place as the result of the implementation of the Kaizen concept in Japanese corporations. In contrast to the usual emphasis on revolutionary, innovative change on an occasional basis, Kaizen looks for uninterrupted, ongoing incremental change. In other words, there is always room for improvement and continuously trying to become better. Originally a Buddhist term, Kaizen comes from the words, Renew the heart and make it good. Therefore, adaptation of the Kaizen concept also requires changes in the heart of the business, corporate culture and structure, since Kaizen enables companies to translate the corporate vision in every aspect of a companys operational practice. According to Imai (1986), an important advocate of Kaizen, Kaizen means improvement. Moreover it means continuing improvement in personal life, home life, social life, and working life. When applied to the workplace Kaizen means continuing improvement involving everyone managers and workers alike. Believers of this theory maintain that managers of production operations cannot stand still; continuous development and improvement is critical to long term success. In practice, Kaizen can be implemented in corporations by improving every aspect of a business process in a step by step approach, while gradually developing employee skills through training education and increased involvement. The principle in Kaizen implementation is: 1. human resources are the most important company asset, 2. processes must evolve by gradual improvement rather than radical changes, 3. improvement must be based on statistical/quantitative evaluation of process performance. Support throughout the entire structure is necessary to become successful at developing a strong Kaizen approach. Management as well as workers need to believe in the Kaizen idea and strive toward obtaining the small goals in order to reach overall success. Therefore, all members of an organization need to be trained in a manner to support this idea structure. Resources, measurements, rewards, and incentives all need to be aligned to and working with the Kaizen structure of ideas. Implementing Kaizen as a part of all daily activities leads to continuous improvements. It not only improves business, but also helps in boosting employee morale. Monitoring the improved areas and stretching improvement activities in them are a vital part of process improvements