It's Time to Rethink Continuous Improvement
1:25 PM Tuesday May 8, 2012
This has been an issue with me for years and is critical to having a successful growth company…companies must be ambidextrous and chose the right process for a given task. Go to our blog site (http://marketdrivengrowth.blogspot.com/)and look under the articles titled Process: Being Ambidextrous on the left hand column. This IS CRITICAL!!!!!!!!!!!!
Six Sigma, Kaizen, Lean, and other variations on continuous improvement can be hazardous to your organization's health. While it may be heresy to say this, recent evidence from Japan and elsewhere suggests that it's time to question these methods…..
Admittedly, continuous improvement once powered Japan's economy….…But what's happened in Japan? In the past year Japan's major electronics firms have lost an aggregated $21 billion and have been routinely displaced by competitors from China, South Korea, and elsewhere. As Fujio Ando, senior managing director at Chibagin Asset Management suggests, "Japan's consumer electronics industry is facing defeat. "Similarly, Japan's automobile industry has been plagued by a series of embarrassing quality problems and recalls, and has lost market share to companies from South Korea and even (gasp!) the United States.Looking beyond Japan, iconic six sigma companies in the United States, such as Motorola and GE, have struggled in recent years to be innovation leaders. 3M, which invested heavily in continuous improvement, had to loosen its sigma methodology in order to increase the flow of innovation. As innovation thinker Vijay Govindarajan says, "The more you hardwire a company on total quality management, [the more] it is going to hurt breakthrough innovation. The mindset that is needed, the capabilities that are needed, the metrics that are needed, the whole culture that is needed for discontinuous innovation, are fundamentally different….."…Customize how and where continuous improvement is applied. One size of continuous improvement doesn't fit all parts of the organization. The kind of rigor required in a manufacturing environment may be unnecessary, or even destructive, in a research or design shop……Question whether processes should be improved, eliminated, or disrupted. Too many continuous improvement projects focus so much on gaining efficiencies that they don't challenge the basic assumptions of what's being done….…Assess the impact on company culture. Take a hard look at the cultural implications of continuous improvement. How do they affect day-to-day behaviors? A data-driven mindset may encourage managers to ignore intuition or anomalous data that doesn't fit preconceived notions