CI 101

How do you align Kaizen with Business Objectives?

When you have specific business improvement goals as part of your Business Plan and strategies, it is easier to identify where you should focus on kaizen activities.  But even if this does not exist, you can still align your kaizen to your business goals.  Let’s take a look at how you would do it under each scenario.

Before I continue, I want to clarify something.    Previously I defined strategy as the framework that establishes what the organization will do to deliver value and how it expects to accomplish target revenues and profits.  However, it is common to use the word strategy while talking about the activity, policy, or process designed to achieve the objective.  For example, to support the objective increase in sales from x to y, the process or activity z (strategy) grow business by 10%.  To be consistent, I will use the activity or process to indicate the way to achieve the objectives.

When it’s time to develop next year’s goals, you group the business plan with the continuous improvement plan.  Achieving those goals means achieving the desired conditions for profitability, delivery, quality, and people.  From these statements of intent, you move to develop specific objectives, which are a clear target or destination.  To make your business map more effective, you also established what are you going to do to achieve them, and how you are going to do it.  At this time, you can identify in what department or area this activity will have more impact on the KPI’s and use the information to plan specific projects.  The kaizen events will help to achieve the objectives.  Kaizen is very powerful when used as a tool to improve the process to close the gap with the objective.   

When the business plan does not include the improvement plan, you can still align kaizen with it.  Your team is dealing with problems that impact productivity, quality, cost, and delivery.  Daily kaizen, and events, can help to overcome those challenges by improving the process and solving operational problems.  You can start doing daily kaizen at any time to start tackling their pain points, but some recurrent issues with high impact in the business deserve a kaizen event.

As always, you need to understand the problems first.  Talk with the team, key players, customers, and learn about their pain points, challenges, and needs.  A brainstorming session with the team would be a good start to generate ideas for possible kaizen events.   The next step is to validate those ideas, to see if they align with the objectives or drive the business KPI’s.  With a refined list of kaizens, the next step is to prioritize based on the effort vs. impact or benefits level.  After this, you are ready to start planning kaizen.

The important part for both processes is to align kaizen with the business objectives, which should target KPI’s that measure customer satisfaction, quality, delivery, and cost.  Let’s keep improving!