‘Evolve or die’, goes the quote. In order for businesses to survive and thrive, they have to be willing to make changes that improve their position. Continuous improvement is the ongoing and incremental enhancement of an organisation’s products, services or processes.
Businesses have several continuous improvement strategies they can utilise. In this article we discuss 4, namely the Lean continuous improvement strategy, The PDCA (Plan-Do-Check-Act) approach, The value stream mapping strategy and the Total Quality Management (TQM) approach.
The lean continuous improvement strategy
The lean approach focuses on increasing customer value by making small changes. This incremental nature borrows aspects from Kaizen, a practice which believes everything can be improved with continuous non radical changes.
The Toyota motor company has used the Lean approach since the 1950s to increase customer value. One of the ways they do this is by focusing on what customers value most to determine that which can be eliminated. In so doing, they are able to reduce waste and optimise operations.
Another dimension of the Lean approach emphasises the building of a culture that empowers employees to share ideas and contribute to improving their work.
To implement the Lean approach, practitioners suggest; identifying what customers value, developing of flow production or continuous production, supporting flow of materials to constrained operations and seeking the ideal circumstances that further reduce waste to zero.
Benefits of the Lean continuous improvement approach include;
- Higher efficiency
- Faster delivery cycles
- Reduction in errors
- The above lead to better customer experience
Although developed by the Toyota Motor Company, the Lean strategy can be implemented across any industry, from education to healthcare and even fashion. Toyota has gone ahead to share their knowledge on the Lean approach.
The PCDA (Plan-Do-Check-Act) method
With the PCDA cycle, an organisation walks through the 4 steps of improvement on an iterative basis. Because it is a cycle with one stage leading into the next, it ensures that improvement is continuous. It gives organisations and teams a chance to improve at each stage.
It is broken down as follows:
- Plan- At this stage, the organisation makes an assessment of their current situation in order to identify where improvements can be made. They determine how those improvements will be made and set objectives.
- Do –This is the stage where the plan in the previous stage is implemented. Systems and processes are changed and employees are trained and equipped with the skills needed to be part of or carry out the change.
- Check-The check stage is about looking at the effects of the implemented changes. At this stage, the organisation can compare with data got at the Plan stage.
- Act-A full analysis of the data from the change implemented is carried out at this stage. Both positive and negative results, loopholes and bottlenecks that are preventing the desired results from being achieved are noted. The results from the Act stage are fed back into the Plan stage.
Benefits of the PCDA method
- If embraced it can make you a solution oriented business. The cycle can be used a number of times to address different issues. Knowing that there is a problem solving mechanism in place will lead to higher employee productivity and engagement.
- Continuously improving systems can help organisations zero in on a competitive advantage over others in a similar business who are content to do things the same way.
- A side effect of this method is risk mitigation. Mistakes and errors can be spotted, solved and stopped from being replicated.
The value stream mapping strategy
The value stream mapping process allows organisations to map or create visualisations of all the work processes needed to get a product or service from start to finish. Value stream mapping works as a continuous improvement strategy by clearly showing what happens at every step of the organisation’s work processes.
It makes it easier to see where value is being added and where there is resource wastage. Having this information arms management with accurate data on where to make improvements and in order to deliver more value to their stakeholders.
Benefits of value stream mapping
- It helps to identify the areas where an organisation is being wasteful
- A clear view of work processes helps management in planning. These plans can range from human resource training strategies to those for capital expenditure.
- With information on work flows, organisations can better plan for their improvement.
Total Quality Management (TQM) approach
This continuous improvement strategy has roots in the manufacturing industry, but like the Lean approach, it has been adapted to other industries as well. TQM focuses on organisation wide improvement in order to guarantee the success of a company. This includes areas like; employee engagement, customer satisfaction and communication.
Advantages of using TQM include:
- Reduced costs and better cost management
- Higher profitability
- Increased customer loyalty and retention
- Improved employee morale
- Greater shareholder and stakeholder value
Principles of continuous improvement strategies
There are different approaches to continuous improvement strategies but they have a few things in common. In modelling any of them, keep the following principles in mind.
Change is incremental
Rather than big overnight changes, changes happen slowly and steadily. In addition, these changes are initiated within the organisation and not as a response to external forces.
Employees play an important role
Continuous improvement strategies work best when employees who are tasked with doing the work share ideas on how to solve challenges they face and on how to better processes. As a result, there is a lot of communication and dialogue with employees. This has an added benefit of employees owning and embracing change.
Measuring as a cornerstone
Any changes that are made are monitored and measured. In this way the organisation has a wealth of learnings. Changes that work can be replicated, those that do not can be improved.
Implementation may be less costly
Continuous improvement strategies are all about small changes. This means that organisations may be able to make changes without stretching their budgets by too much.
Continuous improvement strategies see business improvement as a process, and not a one and done task. In a dynamic business world where change happens fast, embracing these strategies will help businesses small and large adapt, stay ahead of their competition and deliver continued value to their stakeholders.