Fast and Intense: Kaizen Approach to Problem-Solving

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By Mark Price and Tim Williams

Perhaps it was impatience with how long traditional projects take. Often it was an awareness of how hard it is for people to concentrate on improvement when they keep thinking about getting their work done. To some extent it was a matter of their innate respect for the people who do the work. For all these reasons, years ago the Japanese inventors of the Lean improvement systems came up with a different improvement model they called Kaizen.

Kaizens (or blitzes, as they are sometimes called) are improvement events where people work only on improvement for a few days, up to a full week. In a traditional Kaizen project, the people from a particular work area come together with a few experts for four or five days straight and complete most or all of a DMAIC cycle on a narrowly targeted high-priority issue. ("We need to process loan applications faster.") The model has been so successful that this basic approach has been adapted to other uses such as service design sessions.

Example of a Bank's Use of Kaizen

A major national bank started using the five-day Kaizen approach whenever it wanted to attack process speed and efficiency problems. The bank's Kaizen events all share four characteristics:

• The purpose is to take a cross-functional view of the process or work area.
• Participants are people who are directly involved in, and usually responsible for, various parts of the process. The team is cross-functional.
• Participants are pulled off their jobs for several days at a time.
• The project is well-defined going in because there is not time to redefine the purpose or scope.

A Typical Kaizen Schedule

Here is a sample agenda which the bank uses for the five days:

Day 1 is an afternoon spent training participants on topics that cover basic concepts related to the goals of the project. This could include teaching relevant Lean or Six Sigma concepts and reviewing relevant data.

Day 2 is spent looking at the process with new eyes. Participants do a "unit walk," a tour of operations affected by the problem or situation being studied where they simulate being a work item flowing through the process. The group visits each portion of the process, where, because there is cross-functional representation, they have the opportunity to hear insights from someone who works in that area. The group creates a value stream map (a picture of the "as-is" situation) that captures the basic process steps, such as cycle times, number of steps, rework loops, queuing delays, work in progress (WIP) and transportation time.

Day 3 is designed around clarifying problems and brainstorming solutions. The team re-organizes the value stream (on paper) or creates a "should" map that depicts how the process would need to function to solve the identified problems. The outcome includes developing action plans for implementing solutions or trial simulations for the next day.

Day 4 is used to test the solutions, conducting a simulation within the operations if possible. The group quantifies the improvement if the proposed changes are implemented, using estimates of reductions in travel time, queuing time, work in process, number of steps, number of forms, and so on.

Day 5 is when participants prepare and present their findings to the sponsor in a formal report-out session.

Making It Work and the Results

The bank makes this model work by having its internal consultants (equivalent to Master Black Belts) partner with the manager/sponsor to pick problems that are extremely high priority, not only for that work area but also for the business as whole. This makes it much easier to justify taking people off their regular jobs. Also, the goal of the event is a little more modest than a traditional Kaizen. Instead of having solutions up and running full-bore after five days, teams are expected only to get through the simulation and piloting of solution ideas. The internal consultant will then assist the team with full-scale implementation.

In the many Kaizens this bank has run, it has achieved results such as:

• Cycle-time improvements have ranged from 30 percent faster to nearly 95 percent faster, measured sometimes in minutes and other times in days. One administrative process went from 20 minutes to 12 minutes, and a complaint resolution process dropped from 30 days to 8 days.
• Fiscal indicators have all been positive. One high-level project has allowed the bank to start charging for a service that previously was offered free to customers. New revenues are expected to total between $6 million to $9 million per year. Other projects have led to cost reductions or loss avoidance in the hundreds of thousands of dollars.

An Alternative Kaizen Format

While consecutive days of intense work is the ideal, some companies have found it impossible to pull an entire work group, or even a subset of a work group, off the job for the better part of a week.

One company worked around this issue by using the following structure:

• The team was brought together for a brief meeting where the problem was explained and people brainstormed what they would need to know and understand in order to find solutions.
• The team leader, a Black Belt, and one team member then worked offline during a period of several weeks to gather data and refine the problem definition.
• The team was brought together for a day to rapidly analyze the problem and come up with complete action plans – not just ideas – for improvement.
• Since the changes likely would affect the everyday work of the team members, they and others were involved in making the changes real-time on the job, and establishing a control plan.

This alternative Kaizen structure works well in this company because:

• The company is still relying on the knowledge of the people who actually do the work.
• It is data-based decision making.
• The company starts with a narrowly defined problem or opportunity statement – often the participants may be examining how they can implement a Lean principle to their process, such as "How can we make information flow better?"
• The company takes steps to verify that the target is likely to bring important, measurable results. Random or "drive by" Kaizens, chosen with little forethought, may, at best, lead to local improvements, but will not contribute to significant value stream gains.

Conclusion: Concentrating on Creativity

Kaizen events are a powerful improvement tool because people are isolated from their day-to-day responsibilities and allowed to concentrate all their creativity and time on problem-solving and improvement. Companies which use Kaizens have found they generate energy among those who work in the area being improved, and produce immediate gains in productivity and quality.

About the Authors: Mark Price is a vice president with George Group and has led Lean Six Sigma deployments for Global 500 clients in service and product companies. He has been working with corporate teams to design and implement successful performance improvement programs for the last 16 years. He can be reached at mprice@georgegroup.com. Tim Williams is a Master Black Belt at George Group. He is experienced in applying Lean Six Sigma to the financial services industry to drive bottom-line results. He has assisted organizations in scorecard development, business review practices, and process improvement strategies. Mr. Williams has been a speaker at conferences for the Banking Administrative Institute and the Institute of Business Forecasting. He also contributed to the book Lean Six Sigma for Service by Michael George. He can be reached at twilliams@georgegroup.com.

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