The House of High Quality Articles for Everyone in the World

Jan 29, 2012

Kaizan vs Kaizen

Everybody in the business world is familiar with the Japanese word 'Kaizen' and it refers to the process of effecting continuous improvement in a business organization.

Quality of products cannot be improved in one or two steps. Every business organization should strive to introduce improvements in every stage of the production process and there will always be room for further improvement. By introducing improvements, the production process becomes easier and more cost effective. The profits of the company increase and the company will have the edge to compete with any other company in the market.

There is another word, Kaizan, which sounds similar but is entirely different in meaning. It refers to the unfair practice of falsifying business records and it is illegal in many countries. By cooking the books, the company tries to cheat the authorities and the public. The company's only aim is to make money by hook or by crook. In practice, no improvement takes place in the business organization and whatever it tries to portray is market hype.

In a competitive business world where everybody is trying to make profits, only a very few people understand what kaizen means. It is therefore necessary to explain the tools of kaizen and the healthy business practices to make improvements in the production process.

The most difficult obstacle to overcome while implementing improvement is the business culture. Talking about improvements will not bring about quality in the company's products; there have to be concrete steps taken to change the existing business practices.

Kaizen, in its real sense is not merely about reducing the workforce and trying to create an image of a prosperous company among the public. These efforts may result in some short term benefits but they don't improve the quality of the company's products.

Toyota, the leading manufacturer of vehicles, which doesn't give false and unrealistic promises to its customers is an example of a company in which kaizen is practiced earnestly. Its mission statement simply states that the company will be fully responsible for its actions and the quality of its products.

To achieve product quality, waste must be eliminated at all levels of the production process. It includes efficiency in accounting, workforce, marketing and so on. The company should aim at long-term goals rather than short-term ones. The business organization as a whole, starting from the top to the bottom, should be responsible for bringing about continuous improvement in its production process.

Konusuke Matsushita once explained why Western companies are doomed to fail. He attributed strict adherence to Theory X as the main reason for the failure of Western companies. Western companies exclude the working class from decision making process and the employees are forced to work like machines. There is no unity between the workers and the management in Western companies. Such companies will fail to bring about any improvement in the quality of their products.

Kaizen, on the other hand, emphasizes unity among all and respect for each other. It recognizes the fact that the backbone of a company is its work force. It, therefore, takes all possible means to improve the quality of the workers. To improve the quality of products, the company should respect not only its workers but all other people who the company has dealings with as well. This is one area where the Western companies miserably fail. They put forward lame excuses for lack of respect for its employees and customers.

Any step taken to improve the quality of services and products must be based on long term goals. Quality improvement is possible only if every individual in the company is committed to improving the quality of its products. It is the mindset of people that has to change most in order to achieve quality improvement.

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Jan 21, 2012

Some Facts About Six Sigma SIPOC

Here are some things you should know about Six Sigma SIPOC. The acronym SIPOC (Suppliers, Inputs, Processes, Outputs and Customers) is a high caliber method of doing business that shows how the current process of taking care of the customer actually works. It breaks down exactly what needs to be done and how it needs to be done.

Suppliers will provide inputs into your process. The Inputs will define the service and the material, as well as information that is utilized in order to produce any outputs. This Process will be a defined series of activities that typically adds value to the inputs to make outputs for customers. The Outputs will be the services, products, and/or information which are of value to consumers.

Customers will be the users of these outputs which are produced by these processes. What Six Sigma SIPOC essentially is, is a map of the highest caliber. When a company is going through the motions of improving quality, they will implement this method with great success. It helps the company better understand that what they are implementing is to become more streamlined, which in turn, makes it happen.

The making of a SIPOC diagram is going to be a team activity for you which involves brainstorming in order to find the hard to see details. The team will consist of the stakeholders and other pertinent parties involved with all of this. When implementing SIPOC for new processes under design, it would be a good idea if you start from the customer and go backwards to the supplier. There is a different way though existing process. For this scenario, start with process definition then follow with the identification of your outputs, your customers, your inputs and then suppliers.

Making a process map will take the description of the process to a new level of comprehension. While verbal descriptions can provide the nuts and bolts of this process, a map makes clear the flow of every event in the process. A team will then see if there is a good path for the process or if any obstacles are there in the way of bottlenecks, rework, etc.

One aspect of making a Six Sigma process map within an organization is the expectation that the process within one department can be described in different ways. This might be the outcome of incorporated organizations, and not so much the merging processes. It could simply be the variety of the employees carrying out the process.

One way to document the process is to perform a walk-through with others. Getting together other associates who will perform the process gives them an opportunity to work together in order to provide input into what exactly the steps currently are. It helps builds the variety of the Six Sigma Team.

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Jan 19, 2012

Supply Chain Management Optimization

End-to-end supply chain management optimization leads to organic performance. This helps supply chain management system to improve its forecasting and inventory management, fulfill commitment with more efficiency, become more effective in handling sourcing and supplying management, streamline logistics management, and certainly help to enhance post-market supports.

In the ongoing economic scenario, business organizations are focusing on how to keep going on with their businesses and at the same time, preparing themselves for future development. This chain of a business organization represents an untapped opportunity to gain short-term and long-term cash-flows and cost-savings. Business organizations stand to justify their working capital and develop with making use of the advantages of the given business atmosphere and implementing better and streamlined end-to-end supply chain expedients by utilizing world-class technologies.

The companies are concentrating much on increasing cash-flows. The reason that causes them to run after the cash-flows is the given economic scenario where almost all kinds of businesses are struggling to survive due to cash-strapped economic situation. Even the blue-chip companies are being seen to have been battling in this antagonistic atmosphere. Banking institutions are reluctant or slower in processing loan advances to them, aggravating their agonies. All these factors affect adversely the supply chain system. Getting bailout of this axis is possible with replacing their supplier chain procedures with an end-to-end view. This replacement deals with the following activities.

1. Stronger inventory road-map

2. Efficient forecasting method

3. Efficient means for sourcing and procuring

4. Fulfillment of commitment

5. Planning for on-time delivery of logistics

6. Post-market support

There are three distinct unproductive supply networking procedures that impede the progress and the companies need to be careful about them. They are as follows.

1. Dynamic inventory road-map deficiency

2. Ineffectually speedy processes affect supplying process and delay timely delivery

3. Inattentive to benchmark freight rates and use low-cost carriers

Supplying chain operators are required to closely monitor over these issues. These processes siphon off cash of a company and their cumulative impact can drain out their competitiveness and productivity also. All of these processes are interlinked and if any of them is incompetently devised, the other processes will definitely get affected. To save the system from degeneration, an end-to-end supplying chain management system has to be introduced and optimized.

For making this optimization process successful, business organizations are to ensure that they have brought in comprehensive changes instead of incremental changes. They are to plan for an end-to-end optimization approach and implement it to address full-range of this chain procedures. In addition to it, the companies are to ensure that they have undertaken the changes into their own system and have combined the system with their associates who can be, for example, suppliers, manufacturers, distributors and customers. When the effective processes are driven in and the ineffective processes are driven out of the chain, the objectives of supply chain management will definitely be realized.

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Jan 3, 2012

Six Sigma and Value Stream Mapping

Business processes are similar to a river flowing in a natural direction and carrying information from point A to point B.

Value Stream Mapping (VSM) is one of the techniques used in Lean Six Sigma for identifying areas of waste that need to be avoided in both manufacturing as well as office business processes. Aside from identifying areas of waste, VSM also helps in streamlining business processes for achieving higher productivity. VSM is based on scientifically proven methods, making it necessary for organization to employ profession Six Sigma consultants (VSM specialists) during the implementation stage.

The Initial Process

Implementing VSM is a long drawn process where the first step involves mapping the current flow of materials or information in key business processes of an organization. The mapping is done with the help of flowcharts that depict the flow of goods or information from one end to another. The flowchart also contains information about the average time taken for the completion of various sub processes. For generating a comprehensive flowchart, consultants often gather inputs from business heads, floor managers or factory workers. While creating the flowchart, key sub-processes are highlighted using specific icons. This helps in pinpointing areas where waste and inconsistencies are happening. The flowchart also helps in understanding the complexity of a business process, which needs to be simplified for increasing efficiency.

Future State Of Value Stream Mapping

In the next step, VSM consultants discuss each step depicted in the flowchart with the management for finding out ways that would streamline and optimize the whole business process. In Six Sigma terminology, this is referred to as Future State Value Stream Mapping (FSVSM). A number of methods can be used during FSVSM process but only those need be selected that help in streamlining processes without affecting the day-to-day operations of an organization. One such method is Cellular Manufacturing, which can be used during FSVSM. Although it is a simple concept, it requires adequate planning on part of the consultants as well as the management. Takt Time is another method that is used for evaluating 'lead-time' of manufactured goods or services rendered. This method is commonly used in organizations where the main objective is to deliver goods or services in time, for e.g. courier companies. Another method is known as Kanban, which forms a part of Just In Time (JIT) manufacturing system. It helps in maintaining low inventory levels and work in progress without affecting the quality or volume of manufactured goods.

Effectiveness In Automotive And Other Manufacturing Industries

VSM has proven to be very effective in organizations that make use of large and complex assembly line manufacturing processes. Automobile manufacturing companies are probably the best examples as far as the effectiveness of VSM is concerned. Top automobile companies such as Ford and Toyota have successfully implemented VSM in their business processes, which has in turn helped these companies in manufacturing high quality products while reducing costs at the same time.

Although concepts of VSM are applicable in all types of manufacturing organizations, companies other than automobile companies may find it a little difficult to implement VSM word for word. Some consultants also feel that benefits associated with VSM are sometimes over-hyped when it comes to implementing VSM in non-automotive companies. Personal opinions may vary but what is certain is that VSM does help in reducing waste if implemented properly.

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