Kaizen vs Operational Excellence

Kaizen events are widely regarded as the best way to institute improvements and change in a short period of time.  But are they always the best method, particularly in the high variation, low mix environment of a job shop?  Let's compare and contrast Kaizen events to the Operational Excellence model.

Kaizen Events

Kaizen means "improvement" in Japense. Kaizen events are generally part of your companies lean program and used at the plant level to get quick wins.  They focus on a single area of the plant, removing obvious wastes from a process, and setting up simple systems to control them.

Here's how the standard week-long Kaizen event unfolds in many companies.  First, you spend the first half to full day learning the basics of lean, and if you're lucky get a short amount of time on the floor to start observations.  You really aren't digging too deep into the problems; you're basically looking at low-hanging fruit.  You aren't doing a lot of root cause analysis because there simply isn't time.  The next two days are spent doing actual improvements, most of which tend to be 5S sort and shine activities.  Then the remainder of the week is spent finishing up small projects, filling up the red tag area, assigning work to the parking lot, and completing your report out.  In many event, you are lucky if you get 2 solid days of work done.

At the end of it you end up with a work cell or process that has been cleaned up and possibly had 3S (definitely not 6S) performed.  The people feel good, management feels good, and the area looks great.  However, often the changes are often not lasting improvements unless your company has a good lean culture.  It is not uncommon to revisit an area that had hosted an event 6 months later, and to see it back to it's original state.

Kaizen events very useful in introducing lean concepts to your workforce when rolled out correctly, they do temporarily boost morale and improve working conditions, and they can solve limited problem in the work area.  But they are not the panacea to all a company's ills, and very often they are limited in the complexity of problems they can solve.  They approach the problem by examining a mile wide area, but only going an inch deep.

Operational Excellence Events

Operational Excellence involves a company-wide initiative to simply do a better job than your competitors at all levels.  It involves training people to understand their importance in adding value to the customer, and make systematic changes that last.

Operational excellence events are usually longer-term projects with a specific goal in mind.  In job shops, this goal is often the removal of a constraint (from Theory of Constraints).  The events generally last many months, involve serious root cause analysis and data collection, apply lean tools to remove waste, and ultimately improve FLOW through the process.  They also heavily involve training your people to understand flow and how they add value to the customer.  They are the exact opposite of the Kaizen events in that it attempts to examine a one inch area, but dig a mile deep.

Operational Excellence events are the method I prefer to use in job shops as many of our problems are not readily apparent by simply scratching the surface, but often we need to dig deep, ask hard questions, and redefine the way we do business.  They are the perfect tool to use to create lasting change in a dynamic environment.

A common Operation Excellence (OpEx) event looks something like this.  It is 3 months long, with the team meeting every other week.  There is a core group of employees that attend all events, but many other team member switch out event-to-event, depending upon there area of expertise.  The first two days of the first week are a standard introduction to lean, with the rest of the first week being dedicated to collecting data.  The next event week can also dedicated to collecting data.  The third, forth, and fifth event weeks are dedicated to brainstorming, planning, and designing work flow.  The rest of the event weeks are dedicated to actually implementing changes, creating standard work, controlling WIP, 5S (6S), and developing your audit systems.  There are short weekly call-out meetings, and a large final presentation.  At select periods of time after event completion, the group meets ensure compliance and that the changes are being sustained.

The OpEx process has some very distinct advantages, including:

• Time and resources are allotted to do serious root cause analysis, and develop high-level solutions that would otherwise be difficult to obtain in a shorter event
• The group is very focused on a small area, and become experts in that area.  They understand the flow of product through the process, and how it affects their downstream customer.
• Almost no work ends up in a "parking lot" list; it is completed during the project
• Sustainment is excellent, as auditing is a key element to the process

In the first OpEx event I led, we focused on front-end cutting and bending processes that constrained our whole operation.  They had been on overtime for years, and morale was extremely low.  We developed standard work for the both operations that made sense to the operators, reduced the amount of work that needed to be done at each station, and made slight adjustments to work flow.  We level-loaded the stations the best we could, and developed systems (with visual indicators) to limit whip and keep it organized.  We also completely cleaned and 6Sed the area, provided consumable stations and storage, and upgraded common tooling and measuring devices.

The results were dramatic.  A department that consistently ran at 84% in efficiency has consistently run north of 110% efficiency since then.  They went from being schedule every weekend for overtime to being scheduled twice in a one year period, both of which were due to weather-related customer emergencies.  Morale greatly improved.  The downstream departments that had consistently outpaced our OpEx department could not keep up, and our bottleneck had moved to materials and engineering.

Comparison

Below is a side by side graphic comparison of the two method:

Conclusion

There are no guarantees that you would see similar results with OpEx events in your operation, but I can guarantee that your events will be more focused, larger problems can be addressed, and your employees will "buy in" to the process to a much greater degree than they do with standard Kaizen events.