becomes more chaotic; the bigger the company, the more entropy by definition. As complexity increases within a system, so does chaos. This is why Kaizen is needed to simply stay competitive and healthy.
Many companies find themselves fighting fires within the organization, which leaves them taking care of only the imme- diate issues of the company. Root cause issues are not solved or understood, including at the executive level, and the fires are created by key critical problems not getting resolved. The executive needs to understand that the collective individual gripes expressed on the manufacturing floor are indeed the keys to the solution.
So often, observable “waste” is being overlooked in order to not “rock” the proverbial boat. Major changes may be needed that companies fear, such as capital cost expenditures and potential down time. Too often, manufacturing companies in North America have a management mindset that in order to increase efficiency and decrease cost, you must simply de- mand your employees work faster and harder. Simultaneously, they reduce spending on small but vital items, and completely avoid large capital repairs or moves—considered the sacred cows due to someone’s cost reduction agenda. When the system gets so bad that there are too many fires to put out and not enough capital to fix even immediate prob- lems (despite draconian cost saving measures), the company collapses, often blaming the wrong people in the process. A shortsighted mindset is a sure path to bankruptcy. But Kaikaku is not just used to undo or overcome poor management budgeting issues, but to also re-examine why the current system or model should even be used.
Kaikaku in Action To dispel notions that Kaikaku can only be used at the OEM
level, here’s an example of a company that had been on a lean journey for six years. In that time, they had become a lean leader in mold manufacturing and had many refined systems that put them ahead of their competition. They had created a good lean culture and “top down” lean mindset. When we first entered the company, Active Burgess, we recognized their tremendous strides and endeavored to ana- lyze their current flow, questioning some of their core layout. Redundancies could be consolidated between the two plants that they occupied. An overhaul of machine location and plant organization could be re-arranged to improve both sites' productivity but requiring a capital commitment. Many
machines and operations were consolidated to reflect the real flow within the two organizations.
Cost savings and an improved value stream were revealed. New foundations were laid and cells were reorganized to achieve time and movement reductions that revolutionized the operations’ function. Fortunately, the innovative executive staff, including the President and CEO, Mike Bragagnolo, as well as VP of Opera- tions, Doug Brockman, understood the power and profitability in the proposed changes and decided to make some deci- sions that involved investing in the future, resulting in a 30% reduction in mold build hours and a repayment of capital costs within the first few mold builds.
Kaikaku begins with a healthy executive lean mindset that is willing to ask these tough questions: • Are we investing in our future or just trying to cut costs and put out immediate fires?
• Is major capital investment needed to achieve not only competitiveness, but to surpass the competition?
• Is our current value stream reflecting the ultimate demands of the market and present/future needs of our customers?
• Are we keeping outmoded systems and machines in order to avoid downtime or capital expense?
• Are our designs the simplest and most manufacturable or are they the first ones we came up with that satisfied customer standards and functions?
• Do we have the metrics and tools to identify where change and innovation is possible or are we impeded because of fear and lack of data?
• Is our business model correct or are we missing our niche or an evolution occurring in the market?
• Are we a company only interested in status quo or are we bold enough to accept Kaikaku and become a market leader?
Shortly afterwards, new prospects toured the renovated
plants and were so impressed that new business came as a result. Many companies do not realize that a commitment to lean has an effect on not only employee and company efficien- cies, but also on how customers view an organization. If you find your company has gone as far as it can using standard lean refinement tools and is unable to progress further due to your current paradigm of business, it is time for Kaikaku. Because sometimes, “If it ain’t broke, you have to break it.” ME