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CONTENTS

Origination of Kaizen ................................................pg. 3

Traditional Western Business Practices ..................pg. 4

Common Western Philosophies .........................pg. 4

Kaizen is Different ....................................................pg. 5

Basic Kaizen Philosophies ..................................pg. 5

Benefits & Application of Kaizen .............................pg. 6

Success Stories....................................................pg. 6

Applications Elements .........................................pg. 7

Ranking ................................................................pg. 8

Establishing Procedures ......................................pg. 9

Incentives and Rewards .......................................pg. 9

Customer Focus ....................................................pg. 10

Standardizing & Sustaining Kaizen .........................pg. 11

Integration .............................................................pg. 11

Issue Resolution ...................................................pg. 12

Kaizen Leaders ......................................................pg. 12

The information presented in this best practices guide was obtained from sources whom we deemreliable and the best available sources; Graphic Products, Inc. has made every effort to assure this

information is correct. However, we do not guarantee accuracy or completeness. Graphic Products,Inc. makes no representations or warranties of any kind, express or implied. Information in thisguide is subject to change without notice. Except as expressly provided for in writing, the liabilityof Graphic Products, Inc. arising from the use of this guide is specifically excluded and GraphicProducts, Inc. disclaims all warranties and any liability for damages of any kind and any liabilitywhether in contract, tort under statute or otherwise for any injury, damage or loss whatsoever. Noreliance should be placed on information contained or to be implied or inferred in this guide, andusers of this guide should verify all information with ANSI and OSHA sources directly.


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Since the start of the industrial revolution, managers of facilities have spent a great deal of timelooking for new ways to improve production and decrease costs. For over 30 years, Kaizen has beenone of the more popular and successfully applied management philosophies used to help facilities attainthese goals.

Kaizen wasfirst developed in Japan just after WWII. The literal English translation of Kaizen meanscontinuous improvement. When applied as a management term, the meaning is expanded andmore specific. This definition is: The active participation by all employees to continually look forimperfections.

The roots of Kaizen can be traced back to the late 1940s. A time when Japans economy was still reelingfrom the war. Of course, Japan overcame its many challenges and is viewed as one of the worlds greateconomic powers today. In fact, Japanese facilities were out-producing most countries by the 1970swith better overall quality and pricing. Today, Japanese facilities are renowned for producing high-qualityproducts and implementing innovation. What made Japan such a force to be reckoned with?

In the years following World War II, the U.S. provided aid to help reconstruct Japans economicinfrastructure. As part of this aid, U.S. industrial consultants travelled to Japan to teach modern methodsof production and efficiencies. Japanese facilities embraced these new methods and improved-upon-them by integrating many of their own cultural and business philosophies. This is how Kaizen originated.

Since then, the philosophy has helped many Japanese facilities become very successful. Today, Kaizen ishelping to increase the profits and efficiencies of facilities located all over the world. However, for this tobe successful, all employees must embrace the philosophy and be willing to apply its ideals in their workand with coworkers. Implementing Kaizen is likely to change many roles and responsibilities in a facility.Management will begin looking to all employees for ideas to improve a facility. This, in turn, will place

greater responsibility on employees tofind improvements.

Where Kaizen is successfully applied, managers support employees by helping themfind and implementnew methods of efficiency. Since ideas for improvement come from all employees, managers willfindthe new methods spawned from these ideas are easier to implement. Even top executives are expectedto actively participate in Kaizen. This ensures everyone is on the same page and a facility constantlyimproves.

Compared with methods used in many traditional Western business, Kaizen can be much simpler toimplement and maintain since all employees actively participate.

ORIGINATION OF KAIZEN


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20 09 Grap hic Pro du cts , Inc . All rig hts rese rved .DURABILITY FOR THE INDUSTRIAL WORKPLACE

TRADITIONAL WESTERN BUSINESS PRACTICES

As with any region in the world, North American and European businesses have their own philosophiesand management styles. At the core of traditional Western business philosophy is division,or segregation by work type. Western businesses generally segregate management, labor andspecializations into their own separate divisions.

In many Western businesses, managers are seen as leaders because they develop the ideas, proposethem and implement them. Their role is to be in charge. Managers in these businesses generally spendmuch of their time working in an office and are not expected to make regular visits to work areas. Insome facilities, this may serve as a buffer to allow managers space to work. However, the result canactually limit their communication with work area personnel and reduce their effectiveness as a manager.

COM MON W ESTERN PHI LOSOPHIES

Innovation Innovations are typically developed by those designated to do so.

Performance Managers visit work areas when improvements are required.

Bottom Line Changes are implemented only when money can be saved.

Tradition If it aint broke, dontfix it is a common ideal.

Profit Sharing Rewards go to employees producing measurable profits (e.g. Salespeople). Inventory To avoid running-out of inventory, its well-stocked.

Quality Good designers produce quality products.

Reliability Good machinery means reliable production.

Specialization Focus only on your job. Learning other jobs may result in a lay-off due to redundancy.

Repetition The more you do the same job, the better you get at it. Never deviate from your training.

Direction Wait for management to tell you what to do or produce.

Not My Job Venturing outside of your job description may result in an additional expected duty.

Loyalty Always take care of Number One.



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KAI ZEN IS DIFFERENT

In recent history, Kaizen-influencedbusiness philosophies havehelped to shape new roles for muchof the worlds management andlabor. As a result, many facilities

are experiencing greater efficienciesand organization than ever before.

Many of these advancementsare the direct result of a laborforce empowered by Kaizen. Thiscreates an environment in whichall employees participate in findingefficiency improvements and arenever afraid to contribute to thesuccess of their facility.

Modern Kaizen takes this belief one step further. Work area personnel arent just encouraged tocontribute ideas for facility improvementsits expected. This is a philosophy shared by all employeesand helps build an atmosphere of teamwork and achievement. This can greatly improve communicationbetween work area personnel and management and help facilitate efficiency improvements in workareas.

In a Kaizen facility, all suggested ideas are reviewed by management, without preferential treatment.Ideas found to have merit are quickly implemented, no matter who suggested it. This level of activeparticipation empowers employees to constantly strive for improvement and work to keep their facilitycompetitive.

BASIC KAIZEN PHILOSOPHIES Innovation Comes from anyone, but the right environment must be provided.

Performance Managers spend time in work areas so performance improvements are well

communicated.

Bottom Line Cost reductions involve many small steps by both management and labor.

Tradition A company should only have a tradition for change.

Profit Sharing All employees are rewarded forfinding efficiency improvements that increase profits.

Inventory Lower inventories, reduce waste and help uncoverflaws in the system.

Quality Quality comes from constant attention to all levels of product design, development and

production.

Reliability Good station operators maintain and improve their own machines for greater reliability.

Specialization Learn your jobfirst and then learn everything related to your job. (Never Specialize. This helps employees formu late new ideas for improvement.)

Repetition The more one improves, the more the company saves and the more they have to pay

employees.

Direction Look around for visual cues for what to do next.

Not My Job Instead of complaining,find ways to make your job easier and more interesting.(The management s goal is the same as yours.)

Loyalty Look-out for your company. It has the same goal as you.


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BENEFITS & APPLICATION OF KAIZEN

Where Kaizen is properly applied, many unforeseenbenefits may result. Managers often become moreeffective leaders, work area personnel are motivatedand all employees operate more as a cohesive unit. The

end-result is an environment fostering teamwork, wherepeople work together to achieve common goals.

Not only does Kaizen help all employees improve thework they do, facilities experience many benefits as well.Often, these are realized as increased profits and lowercosts.

Managers stand to benefit the greatest by applyingKaizen. They will find they have a constantflow of ideason how to improve their facility, many of which they wouldnever have thought of themselves. Once implemented,

the effect these ideas have can ripple through a facility,positively influencing many unforeseen elements. Theyare also known to expose many issues. Many times, issues managers may have been unaware of.

These benefits are only realized by disciplined managers who actively seek new ideas from all employees.Managers who follow through on these responsibilities are rewarded for their efforts. They gain greaterrespect from employees and, in turn, become more effective managers. This alone brings value to afacility.

This style of management empowers employees by making them responsible for managing theimplementation of their own ideas. They become focused on achieving the same efficiency-improving and

profit-increasing goals as management.

Several popular application strategies are listed in this guide to help properly apply Kaizen. Since no twofacilities are the same, these are only suggested strategies and should be modified to best suit a facilitysindividual needs.

SUCCESS STORIES

One of the largest auto manufacturers in the world, Toyota, is well-known as a pioneer in Kaizen. Theyare credited with formalizing the philosophy and helping turn it into a globally accepted managementphilosophy as early as the 1960s. Since then, Toyotaclaims to have experienced many successesthrough the continued practice of Kaizen. In one example, Toyotamanagers claimed to have receivedover 75,000 suggestions from 7,000 employees in a one year period, of which 99% were implemented.

These are unusual results, but clearly possible with the proper application of Kaizen. One can onlyimagine how much money Toyotasaved by implementing this many improvements.

In Kaizen, the implementation of an idea is viewed only as one small improvement in a continual searchfor improvements. However, these individual improvements add-up over time and can provide substantialbenefits for any facility. Quality, customer service and even sales can increase, while safety issues andsick days decrease. In addition, employees working in a Kaizen facility generallyfind work to be easierand more enjoyable. This results in higher employee morale, job satisfaction and lower turn-over.



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With every employee looking for ways to makeimprovements, facilities may see several fundamentalbenefits. These include:

Improved productivity

Improved quality

Reductions in safety issues

Quicker deliveries

Lower costs

Increased customer satisfaction

Kaizen is known to be beneficial to facilities facingeconomic challenges. In Japan, facilities applyingKaizen were known to overcome many greateconomic obstacles. In fact, post-WWII Japan was

far from an ideal environment for unbridled economicgrowth. Yet, it occurred. Thanks, in part, to Kaizen.

Like the implementation of any new method or process, applying Kaizen does require a brief periodof adjustment. Atfirst, employees and managers may be reluctant to make changes in their roles.Preparing a long list of employee and facility-wide benefits can help overcome this resistance and openthe door to greater acceptance.

In general, facilities are going to benefit from Kaizen differently as will many employees. However, therewill be some common, facility-wide benefits for each employee. Early on, these benefits should be sharedwith employees during regularly scheduled facility meetings, along with any success stories, to help foster

Kaizens continued acceptance and use.

APPLICATION ELEMENTS

The following elements describe several key concepts used to successfully apply Kaizen:

Make continuous small improvements based on employee suggestions

Foster the open sharing of ideas

Hold facility-wide meetings where employee suggestions are always the central theme

Treasure all employee suggestions as a positive contribution to improve operations

Theflow of ideas should move up and down the chain of command

Create a simple suggestion form

Categorize suggestions

Assign categories for suggestions

Develop a process to manage suggestions

Assure suggestions are taken seriously


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RANKING

As shown in the sample forms below (Fig 1, 2), each facility needs to develop a ranking system to aid inthe suggestion evaluation process. Ranking systems help managers sort ideas worth implementing andeliminate those without merit.

Depending on the facility, medium quality suggestions with less complexity could be categorized for

implementation (IMP) by work area personnel (WAP). Those with higher levels of complexity may becategorized for management implementation or involvement (MNG). In either case, all suggestionsshould be easily and simply ranked. This way, managers can give serious consideration to the bettersuggestions. Assure all suggestions are reviewed without bias and seriously considered. Failing toproperly review suggestions would be counter-productive.

To help rank suggestions by merit, establish a point system. Criteria used to rank suggestions can thenbe categorized. Point systems are, of course, up to members of the Kaizen Implementation Team todesign and should be tailored tofit an individual facility. Ranking examples include: Quality, Complexity,Supervisory Attention.

Always work to encourage suggestions. This is accomplished by assuring contributors know their ideas

are under review and will be seriously considered. Implementing most reasonable ideas encouragesfuture contributions and allows them to be tested before elimination. If an idea works, standardizeit! If not, provide a reason to the employee who made the suggestion. By creating this avenue forcontributions, the overall quality and quantity of ideas should improve and helps put Kaizen suggestionsinto action.

SUGGESTION RANKINGS

NAMEWORK

AREASUG. # DATE QUALITY COMPLEXITY

SUPERVISORY

ATTENTION

RANK/

IMP.

Rick Spencer Stat ion 3 27 3 2 3 B 2 / 1 / 0 9 3 1 4 3 / WAP

Bi l l Cof fee Stat ion 27 27 3 24 B 2 / 1 / 0 9 8 3 1 8 / WAP

Jil l Gentry Stat ion 11 27 3 2 5 B 2 / 1 / 0 9 7 2 1 7 / WAP

Joe Anderson Stat ion 11 27 3 2 6 B 2 / 2 / 0 9 6 2 6 6 / WAP

Kim Richards Stat ion 15 27 3 27 B 2 / 4 / 0 9 8 7 8 8 / M NG

Don Cross Stat ion 27 27 3 2 8 B 2 / 5 / 0 9 3 2 5 3 / WAP

Julie Fields Stat ion 2 27 3 2 9 B 2 / 14 / 0 9 5 3 3 5 / WAP

Tim Gross Stat ion 1 27 3 3 0 B 2 / 15 / 0 9 1 1 1 1 / WAP

SUGGESTION FORMNAM E: Kim Richards WORK AREA: St at ion 15 DATE: 2 / 4 / 0 9 # 27 3 27 B

PROCESS OR STATION AFFECTED: Packagi ng M ach ine # 3 , Sta pli ng Sp ring

ISSUE: M a ch in e # 3 d o es no t pr op erl y s ta pl e p ac ka ges be ca use th e sp ri ng ca nn ot p ro pe rl y p en et ra tepack aging 10 % of the time. This issue is slowing production an d delaying delivery.

SUGGESTION: Replace spring on mach ine so packag ing can be properl y stap led, or a l low us to hand-s tap le

pack aging instead. This would require the purchase of a hand-sta pler to replace the current

machine.

Fig 1

Fig 2



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ESTABLISHI NG P ROCEDURES

Successfully implemented ideas should be incorporated intoa work areas standard operating procedures as soon aspossible. This requires properly documenting procedures sowork area personnel have an easy-to-read visual reference.Posting procedures on, or near, locations-of-use is an

excellent way to permanently embed a new procedure into awork area. Labels and signs, such as the example in Fig 3,help facilities improve safety, increase production and reduceemployee training.

As previously mentioned, its generally best to allow the employee who suggests an idea the opportunityto implement it. This may still require management participation, but empowering an employee toactively manage the implementation of their idea increases its chance to succeed and its continued use.When handled in this manner, work area personnel not only work to see their ideas succeed, they aremore open to other new ideas. This increases their performance and lifts morale. Plus, employees areknown to take greater pride in a procedure they helped define and implement.

INCENTIVES AND REWARDS

Never miss an opportunity to reward a good idea. Incentives show your facility values all suggestions andencourages more of them. Monetary incentives work well, but in some situations other rewards may alsobe just as effective. Facilities oftenfind they are rewarded with a monetary savings well-beyond the costof a bonus. In Japan, employees are known to have furnished entire homes with their rewards, while theirfacilities realized even greater savings.

Depending on how a reward system is structured, rewards can go to individual employees or to workareas where an idea originated. Rewarding employees by work areas helps encourage teamwork, butindividual rewards can also breed more competition and better suggestions.

To track a facilitys progress, chart all successfully implemented ideas on a banner and post it forall employees to see. This creates competition and becomes a very effective tool in attracting moreinventive ideas. When properly implemented, both monetary and non-monetary incentive programs havethe potential to snowball into a facility-wide competition amongst employees.

The goal of charting successfully implemented ideas is to provide employees with the feedbackand motivation they need to continue to make more suggestions. Ultimately, this leads to facilityimprovements so management should make every effort to help the process be as pleasant as possiblefor all employees.

DRYER #4

STARTUP PROCEDURE1. START BLOWER AND RUN FOR 3 MINUTES

2. OPEN GAS SUPPLY TO PILOT LINE

3. PRESS LIGHTER

4. VERIFY PILOT FLAME IS BURNING

5. OPEN GAS LINE TO BURNER 1

6. OPEN GAS LINE TO BURNER 2.

CONTACT CARL JONES AT 555-1673 WITH QUESTIONS

Fig 3

Displaying a bar

chart banner in thework area can help

personnel track t heprogress of their

contributions andcompare them wit hothers.


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CUSTOMER FOCUS

With Kaizen, the main goal is to satisfy the customer. To help achieve this, the customers needs andrequirements must be understood. The following list provides several sample questions facilities mayfinduseful in learning customer attitudes:

What does the customer want from this product?

Why do they like our product?

What makes the product more acceptable to the customer?

Would I want the product?

In Kaizen, the term customer applies to much more than just external individuals and entities. Whereproperly applied, employees using Kaizen consider everyone they come into contact as their customer.

When production personnel see coworkers as customers, more care is put into the products they produce.They may notice inconsistencies in the product they are assembling. Instead of overlooking the issue andpassing-it-on to the next station they ask, Why is their product inconsistent?

Employees of a Kaizen Facility trace these issues, up the line, to the root of the cause. The issue maythen be eliminated by suggesting an improvement. The ultimate goal is to provide the highest level ofcustomer satisfaction, without regard to whether a customer is internal or external.



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STANDARDIZI NG & SUSTAINING KAI ZEN

Employees need uniform, facility-widepolicies to assure Kaizen is properlyfollowed. Rules should be establishedto describe how ideas are collected,rewarded and implemented.

Managers should make every effortto keep the lines of communicationbetween work area personnel andmangers open. Their offices should bemade as accessible as possible to allemployees.

As an example, product designengineers should be communicatingdirectly with production managers on

thefloor. This feedback helps designersrecognize issues sooner and well before production of a new product begins.

Evaluate current facility goals and consider setting new ones

Goals should focus on reducing production time, cost and waste

Changes made to meet these goals should be reviewed and adjusted wherever necessary

A facilitys organizational structure and policies should be closely analyzed so Kaizen is uniformly applied

Information and ideas should not only travel down the chain, but up the chain as well

Executives commonly walk into work areas and talk face-to-face with work area personnel

Executives often ask work area personnel about their families and jobs.

INTEGRATION

Kaizen should be viewed as a facilitys umbrellaphilosophy. One that covers all other LeanManufacturing systems, methods and processes.It helps to ensure the successful implementationof ideas, by binding each into a single efficiency-improving movement.

In addition, facilities experience many side-benefitsby integrating Kaizen with other Lean Manufacturingtechnologies. By doing so, techniques can bemodified to better suit unique facility requirements.

Therefore, its a good idea to implement Kaizenfirst. Once fully implemented, employees will oftenbe ready to accept more complex and challengingimplementations.


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ISSUE RESOLUTION

In the spirit of Kaizen, a facilityalways views itself as imperfect.Issues are inevitable, but somerequire more expertise than asingle person may have. This is

where a small group activityknown as Quality Control Circles(QC Circles) can be used.

QC Circles is a methodspecifically designed to helpwork areas and facilitiestackle more complexissues. QC Circles are neverformal assignments and aregenerally formed, ad-hoc, bythe employees themselves

whenever a complex issuearises.

KAIZ EN LEADERS

In many facilities, Middle Managers become theleading advocates of the Kaizen Philosophy. Theirregular interaction with work area personnel givesthem the unique ability to directly encourage employeesuggestions and assure good suggestions are

implemented. Once fully applied, Middle Managerswillfind Kaizen to be an invaluable tool in aiding theimplementation of many of their goals and thoseestablished by upper management.

Converting a facility to Kaizen takes time and patience. It also requires a dedication. Utilize the followingtips to help improve the conversion process:

Make meetings more efficient by developing employee problem-solving-skills

Show employees the many ways Kaizen benefits them and the facility in which they work

Assure a facility is Kaizen Conscious by applying the philosophy daily and by rewarding suggestions

Identify good problem solvers in your facility and look to them for ideas in solving complex issues

The more employee-solved-issues; the easier it is to meet goals set forth by upper management

Standardized policies help to maintain direction and achieve goals

Never hesitate to change policy when they become dated or no longer useful

Since Kaizen promotes constant change, policies must remainflexible for continued adjustment.



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