1. Introduction

Kaizen is both a philosophy and a system. As a philosophy, it implies a way of seeing and thinking about management, that is, a way of conceiving organizational management in terms of objectives to be achieved and ways of achieving them. As a system, it entails a series of tools and methods to be applied to achieve the objectives of the company.

Kaizen implies a continuous search for improvements in terms of quality, costs, delivery, and security in each of the activities and processes of the organization, to achieve the greatest competitive capacity.

Thinking in terms of kaizen implies a way of seeing and analyzing companies in terms of their activities, processes, products, and services. When thinking in these terms, we meditate on the way an entity should operate to achieve continuous improvement in terms of competitiveness and profitability, as well as diagnose the problems and drawbacks that an organization suffers to be competitive.

There are several fundamental concepts around which we must think in terms of kaizen. Those concepts are:

  • Maintenance and improvement management functions.
  • process versus results
  • Apply the Plan-Do-Evaluate-Act / Standardize-Do-Evaluate-Act cycles
  • quality first
  • Detect and eliminate waste
  • Talk and make decisions based on data
  • The next process is the client

Around each of these fundamental concepts, not only its meaning but also how companies usually act and how they should behave will be discussed below.

The fundamental objective of this paper is to help understand the way of thinking and see specific cases in which organizations do not behave in such terms and the effects that this has on their progress.

2. Management functions of maintenance and improvement

Management has two critical and fundamental functions that are maintenance and improvement.

Maintenance refers to all those activities aimed at conserving the current technological, managerial, and operational standards, and sustaining such standards through training and discipline. It is worth asking if there are established standards if they are respected and comply with the standards, and what activities are carried out for this.

Many companies lack established standards and therefore maintaining the way of conducting activities and maintaining operational achievements is difficult if not impossible.

Improvement refers to activities aimed at raising current standards. This improvement is made up of kaizen and/or innovation. Kaizen implies small but continuous improvements as a result of continuous efforts. Innovation implies a significant improvement, as a result of significant investments in technology or equipment. In this regard, it is worth asking if there are improvement objectives, in what processes or activities, and how and who sets them to such objectives. Are there statistics that reflect improvements in quality, costs, processing times, cycle times, and productivity over time?

Traditional management companies are satisfied with making a profit and do not pursue continuous improvement in their activities, processes, products, and services. Nobody stops to think about what and how much has been improved in the last month, quarter, semester, or year of activity.

A company that lacks standards cannot aspire to maintain levels of quality and costs in its market share, much less improve them. On the other hand, if there are no objectives for improvement, control, or monitoring of its compliance, and evaluation of its evolution over time, the company will lose its ability to compete. How can a company that does not maintain and improve its performance compete?

3. Processes versus results

The kaizen pursues the improvement in the processes since only with the improvement of these is the improvement in the results feasible. It is not the same to focus on final costs, or quality problems due to failures and defects as to evaluate why the processes generate said costs and levels of failures and defects, pointing to their correction and improvement. The correct process will produce the correct results.

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Those who concentrate on the results do not attend to anything other than the achievement of better results without attending to how they take place. Of course, this strategy gives results in the short term, and sometimes not even in the short term, and dismal results in the medium and long term. On the other hand, those who focus on the processes pay attention to issues such as the layout, the organization of production, the level of the polyfunctionality of the operators, internal transport, excess movements, the existence of systems and methods to prevent the generation of failures,

Many managers when a crisis arises, the first thing they do is reduce investments in training and training of personnel, salary reductions, dismissal of personnel, and focusing on suppliers of inputs based on price and not the total cost of inputs. All these practices are lousy and destroy the foundations of the entity.

It is worth asking: Do they only set goals for economic-financial results, or also goals regarding processes? Are goals set to reduce waste in processes?

4. Apply the Plan-Do-Evaluate-Act / Standardize-Do-Evaluate-Act cycles

In the kaizen process, the first step consists of putting into practice the cycle plan-do-evaluate-act (PDEA) as a means that guarantees the continuity of kaizen in the pursuit of a policy of maintaining and improving standards. This concept is essential.

Planning implies establishing an objective of improvement or of putting certain actions into practice. Carry out refers to the implementation of the plan. To evaluate is to determine if the implementation is following its course and has originated or not the outlined objectives. And lastly, acting implies executing, adjusting, correcting, and standardizing the new procedures. Once the change or improvement is generated, it is necessary to standardize the achievement achieved through the SPEA process (standardize-perform-evaluate-act).

It is inconceivable that a company establishes a norm (standard) and then internal auditors when evaluating its application, observe its lack of compliance or poor compliance, and once informed of this, they do not act accordingly, so that after some time, time an audit is carried out again and the same errors are observed. In other words, the Plan-Do-Evaluate-Act process registers failures at the level of planning, implementation, and action. In the first place, not only what must be done was not properly planned, but also the conditions were prepared for it to be put into practice. Then we have the lack of realization of the established objectives and orders. Once the evaluation and its corresponding report have been carried out, no action is taken to make the corresponding adjustments to correct the plan,

Any time an incorrectness or anomaly occurs in the process, questions such as: Did it happen because we didn’t have a standard? Did it happen because the standard was not followed, or did it happen because the standard was not adequate?

Around this concept, one should think about how the planning is carried out. How are they informed? How is the staff prepared for its implementation? Who is in charge of the review or evaluation in each case How and to whom are the results reported? And what actions are taken to correct deviations or abnormalities? Or are the processes standardized once the objectives are achieved?

5. Quality first

Of the primary goals of quality, cost, and delivery, quality should always have the highest priority. No matter how attractive the price and delivery terms offered to the customer are, the company will not be able to compete if the product or service lacks quality. Setting quality as the ultimate goal requires management commitment because managers are often tempted to compromise to meet delivery requirements or reduce costs. If they make such concessions they run the risk of losing not only quality but also the very life of the company.

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When thinking in terms of kaizen, the following questions should be asked: based on what parameters are suppliers chosen? based on the price of inputs or services? Depending on the delivery times? Depending on the method of payment? Depending on the quantities delivered? Depending on the degree of innovation of the suppliers in their processes and products or services? Based on quality levels? What work methodology is followed internally to improve and ensure quality? Are poka yoke and jidoka applied? How is the year-over-year evolution of the funds invested in Training? Is the philosophy of the company quality through inspection of final products or quality assurance? Is interest focused on the quality of products or services?

Many companies completely lack a quality philosophy, adopting actions of successive adjustments or reprocessing, and resorting to the inspection of the finished product for this. Applying such an approach not only fails to significantly improve quality but also generates a high production cost.

6. Detect and eliminate waste

Waste or squandering is any loss of resources due to incorrect management of processes, not only manufacturing, but also processes in terms of services, sales, purchases, logistics, and credit, among others.

In a company there is always waste, you just have to know how to observe and analyze the situation. Detecting waste, quantifying it, eliminating it, and preventing it are fundamental issues of the kaizen philosophy and system. The goal for a company is to achieve the least amount of waste per dollar sold.

A company must understand that the costs incurred in its operations are value-added or non-value-added. By adopting a kaizen approach, the company can significantly reduce its costs by eliminating activities that do not add value. When those costs are reduced as a result of applying kaizen, higher levels of benefits are achieved.

Among the waste to be considered we have:

  • Excess inventories.
  • Excess goods for use.
  • Overproduction of goods.
  • Overstaffed.
  • Failures and reprocessing.
  • Breakdowns and excess maintenance.
  • Excess internal transport.
  • Excess movements.
  • inefficient processes.
  • Timeouts.
  • Excessive staff turnover.
  • Loss of customers and sales.
  • Delinquency and uncollectibility in credit management.
  • Frauds.

Many businessmen emphasize that their products are of quality and fully satisfy their customers, what is worth asking is how many adjustments and reprocessing were necessary to achieve the product or service that the customer requires. Others are proud of the products they manufacture or market, but what they don’t know is how many customers and sales are lost due to poor customer service management.

The kaizen is focused on all the sectors and processes of the company, for this reason, it is not only important that the manufacturing processes are satisfactory, but also those of commercialization, credits and collections, logistics, controls and security, hiring and personnel management. , and administrative among others.

An analysis of the financial costs can show us that these are being generated by:

  • Excess inventories, both of inputs and products in the process or finished.
  • Lack of income from funds due to delinquency and uncollectibility of credit portfolios.
  • Existence of unnecessary use goods.
  • Excess breakdowns and maintenance expenses must be covered with financing.
  • Losses in results must be covered by financing.

In the Result Table of a company we have revenues and costs, what is not usually shown and analyzed is how such costs are reached. How much is there waste? And what kind of waste do they give rise to?

A kaizen thought implies being alert to detect the existing waste, facing its resolution, and avoiding its reappearance. But we cannot settle for just detecting problems and solving them, we must also think about what waste can be generated. And how can we prevent them?

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7. Talk and make decisions based on data

Kaizen is a process of solving problems, problems due to existing anomalies, such as failures or errors, or problems related to the difference between the quality and costs set as objectives and the real ones. For these problems to be understood and resolved properly, it is necessary to recognize the root cause, and verify the relevant objects, be it a broken machine, a rejected product, a tool that has been destroyed returned merchandise, or even a complaining customer. Directors and managers must know and visit the place where the products are generated, and the place where the costs are produced. Thus, for example, the financial manager must feel and see with his own eyes the excess inventories, to become aware of the financial costs that this implies.

It is essential to have statistical information. It is necessary to measure to control, and it is critical to control to improve. Collecting data on the situation helps us understand where we are now, this serves as a starting point for improvement.

Regarding this concept of decisions based on data, it is worth asking, do the directors and managers, as well as the accounting, cost, audit, finance, marketing, sales, and personal personnel, know first-hand the production processes and the marketing and logistics? When a problem occurs, are the relevant objects checked? Are there statistics on the progress of the processes? Is a work method followed for problem-solving?

8. The next process is the client

All work is a series of processes, and each process has its supplier and its customer. Each process needs to know who its customers are, what they request, and what characteristics the component or information delivered must have. Based on this, the characteristics that the received inputs must meet, and the personnel and machines/tools and facilities used in the processes will be determined. It also serves to properly organize activities and processes. We have external clients and internal clients, and to meet the requirements of external clients it is necessary to satisfy the requirements of internal clients.

How well are the wishes of external customers satisfied? How many internal rejections are produced in the production processes? Are the requirements of internal and external customers known? How does the internal customer use the product, information, or service? What are they and how did you come to know about them?

9. Conclusions

It is not enough to know about techniques, tools, and methods for prevention and improvement, it is essential to sharpen your eyes and analyze to detect opportunities for improvement. It is not enough to say “you have to improve every day”, you have to have the ability to see where and how to do it. On the other hand, although the kaizen strategy is aimed at making improvements, its impact may be limited if all people participate in kaizen for the love of kaizen, without any specific goal and coordination between the various sectors.

Kaizen without a goal is akin to taking a journey without a destination. It is most effective when everyone works to achieve a goal.

Continuous improvement (kaizen) requires an organization that continually reflects on its activities, processes, products, and services (hansei). Without hansei it is impossible to have kaizen. Hansei is a way of thinking, an attitude.

10. Bibliography

  • Improvement of processes in the company. H. James Harrington. McGraw Hill Publisher. 1997.
  • Value creation. The Key to Competitive Management. William A. Band. Editorial Diaz de Santos. 1994.
  • How to implement Kaizen in the workplace. Masaaki Imai. McGraw Hill Publisher. 1998.
  • Deming method. Rafael Aguayo. Editorial Vergara. 1993.
  • Problem-Solving Techniques. Francisco Rey Sacristán. FC Editorial. 2003.
  • Kaizen. Mauricio Lefcovich. www.monografias.com . 2003.
  • Office Kaizen. William Lareau. FC Editorial. 2003.
  • The improvement of productivity in small and medium-sized companies. Ricardo Fernandez Garcia. Publishing Club University. 2010.