Operational Excellence with Principles Kaizen and Essential Reliability


Operational Excellence with Principles Kaizen and Essential Reliability


Pursuing operational excellence is a continuous journey of improvement and efficiency. The Kaizen principles and essential reliability in production are the backbone of this journey, supporting the structure for high-performance operations. The Kaizen methodology foundation, focused on continuous improvement and eliminating waste (Muda), provides a map to identify and remove hurdles to efficiency. At the same time, for a successful operational transformation, the 4 Ms of essential reliability in operations must also be considered — methods, machines, materials, and workforce — to analyze how each element is required to maximize productivity.  

Integrating these practices with continuous improvement strategies allows for sustainable and resilient growth. This article aims to analyze how these principles interconnect to form the foundation of an ideal operational system.

The importance of Kaizen in achieving operational excellence

The Kaizen methodology, emphasizing continuous improvement, is crucial in achieving operational excellence. This Japanese approach, centered on small incremental changes, is essential for constantly optimizing organizational processes and systems. The Kaizen approach encourages a culture of constantly questioning the status quo, and all team members are encouraged to contribute with improvement ideas.

The key to success when following Kaizen principles is based on their universal applicability—they can be implemented in any process, department, or function, making them a valuable tool for achieving operational excellence at all levels of the organization. Companies can achieve significant gains in efficiency, productivity, and quality by focusing on continuous improvements, even small ones.

This commitment to continuous improvement goes beyond simple process optimization; it is rooted in the organizational culture, promoting an environment where innovation and efficiency are promoted. By identifying and eliminating waste (Muda), the Kaizen methodology contributes to lean and sustainable operations.

Next, we will present the main types of Muda, and how proactively identifying them can further boost operational excellence and remove inefficiencies

Identifying types and critical Muda variables

Identifying Muda types is essential for effectively implementing the Kaizen philosophy. Muda, the Japanese term for waste, refers to any aspect of a process that does not add value. Identifying and eliminating Mudas are fundamental to increasing efficiency and reducing costs. Below are the seven types of Muda and how they can be identified and mitigated in operations:

  1. Overproduction: producing more than necessary or before it’s needed can lead to excess inventory, increasing storage costs and the risk of obsolescence. Focusing on actual demand and adopting practices like Just-In-Time can help minimize this waste.
  2. Waiting (employees): when employees wait for materials, information, or approvals, time is wasted. Optimizing workflow and efficient communication are essential to reduce waiting times.
  3. Waiting (materials and information): similar to the previous waste, waiting for materials or information delays production. Effective management systems and supply chain synchronization are crucial for addressing this type of Muda.
  4. Motion (of people): unnecessary movements of employees during work can lead to inefficiencies. Reorganizing the workspace to minimize movement is an effective strategy.
  5. Transportation (of materials and information): excessive transportation of materials and unnecessary transfer of information creates inefficiencies. These movements can be reduced by redesigning the factory layout or integrating information systems.
  6. Overprocessing: performing more tasks or more complex procedures than necessary can be a source of waste. Simplifying processes and ensuring each step adds value is paramount.
  7. Defects: errors and defects lead to rework and customer dissatisfaction. Implementing robust quality control systems and adopting a preventive approach can help minimize these Mudas.

Identifying and addressing these wastes enables organizations to take significant steps toward operational excellence. As Mudas are eliminated, it’s crucial to involve functional groups in Muda awareness exercises, the so-called “Muda hunt,” so that everyone detects what affects them and opportunities for improvement.

Critical Muda variables refer to measurable indicators of the factors generating waste. The goal of involving these groups is to challenge them to eliminate waste so they begin to understand and apply tangible changes to operational processes.

For instance, reducing machine Changeover time (CO) is a classic lean improvement variable and a critical Muda variable. Analyzing with detail the time between a batch’s last good-quality piece and the first of the next can reveal significant inefficiencies. Traditionally, the total CO time was seen as a fixed parameter; however, with the Kaizen mindset, this time can and should be minimized.

Going into detail about the changeover time activities through direct observation or video analysis can uncover many improvement opportunities. For example, reducing unnecessary movements or wait times can improve the task sequence. The Kaizen approach suggests that changeover time is a variable that can be optimized by properly identifying wastes and implementing improvement actions.   

By focusing on reducing CO, for example, it is possible to engage all operators in a continuous improvement process, where they will perform tasks and contribute to identifying and solving inefficiencies. This collaborative process is a central aspect of the Kaizen philosophy, valuing the knowledge and experience of all operators.

Consequently, critical Muda variables can include the time an operator takes to perform a task (any operator involved in production, logistics, or admin), the number of defective parts, or the inventory – i.e., materials waiting at a given point.

Measuring indicators of critical Muda variables provides a way of evaluating the effectiveness of implemented changes. Considering the earlier example, by measuring the improvement impact on changeover time, organizations can see a reduction in downtime and improvements in other indicators such as product quality and customer response time.

In addition to CO, other critical elements of the production flow must be analyzed, such as WIP (work in process), lead time, and batch size. WIP and lead time are directly related to an organization’s ability to respond quickly to customer demand, while batch size affects flexibility and responsiveness. Contrasting with batch production, a unitary flow approach can help reduce lead time and WIP, thereby increasing agility and efficiency.

Components like the total lead time are major variables within the pull production flow. Reducing the information and material flow lead time is therefore crucial for effectively implementing a pull system, where production is based on actual demand to minimize excess inventory and associated waste.

In this sense, improvement actions should also consider machine availability rates, service levels, and defect rates, which are vital for operations reliability, as we will see next. Monitoring and improving these indicators lead to a more predictable and reliable production environment, where resources are optimized and products are consistently delivered with high quality.

Analyzing critical Muda variables stresses the need for a holistic approach in operational management, where each aspect of the process is constantly examined and refined. Addressing these variables contributes to operational improvement and achieving reliability.

The 4Ms of operations reliability: waste reduction foundations

Essential reliability in operations is often assessed through the 4Ms: workforce, machines, materials, and methods. These elements are fundamental in reducing waste and continuously improving production processes. Identifying and analyzing these four elements is crucial to avoid disruptions affecting flow and operational efficiency.

Workforce, the first M, is directly linked to the system’s reliability. The timely and consistent presence of operators is essential to prevent production delays. Next, we have machines whose availability rates should be maximized to avoid unplanned downtime that can disrupt the operations’ flow. Materials require special attention due to stockout rates; inventories must be managed to ensure a smooth and responsive supply chain. Finally, the methods applied should be refined and standardized to maximize quality and minimize rework, leading to the critical variable represented by defect rates.

Resistance to change is also a significant challenge, compromising essential reliability. Organizations must, therefore, promote a culture that accepts and seeks continuous improvement and adaptation to new methods and practices.

One of the lean metaphors about essential reliability is represented by an iceberg where, below the water level, various problems related to the 4Ms are invisible. It suggests that if the water level lowers, these problems will become visible.

An image that illustrates a lean metaphor where you see an iceberg that below the water level contains various problems that can affect the stability of production.

Like this metaphor, the exact nature of these problems may vary from company to company. This article addresses essential reliability, focusing only on issues that can cause significant problems.

These problems are related to the following critical variables:

  • Punctuality and absence
  • Machine availability rates
  • Material stock shortage
  • Quality defects rates
  • Strong resistance to change

Next, each of the 4Ms is detailed further.

Basic workforce reliability in operations

Workforce stability is key for any manufacturing operation, and identifying and managing critical staffing variables is essential to ensure processes’ continuity and efficiency. Operators’ punctuality and absences are crucial variables requiring constant monitoring, as they directly impact production capacity and operations stability.

In this sense, discipline in the workplace, especially adherence to established schedules, is fundamental. Operators who start their tasks late or take longer breaks can cause significant production delays. In addition, unforeseen absences can completely disrupt operations, creating bottlenecks and affecting the delivery of the final product. It is crucial to implement measures that promote attendance and reduce absence rates.

It is crucial to involve supervisors and the human resources department to address these issues. They should work together to understand the causes of absence and implement strategies to mitigate it, such as incentives for attendance or penalties for unjustified absences. Setting clear goals for reducing non-attendance and implementing measures to achieve these goals is essential to improving staffing stability.

The SDCA tool (Standardize, Do, Check, Act) is very useful in addressing manpower stability. It starts with standardization, by creating a standard that solves a specific problem, then doing the work according to the established standard, checking and acting upon deviations. This cycle is a systematic approach to ensure standards are maintained and continuously improved.

SDCA Cycle (Standard, Do, Check, Act)

Training and work instructions also play a crucial role in implementing new standards and ensuring operators understand the expectations and procedures. With proper training, operators are more empowered to perform their tasks effectively, increasing productivity and reducing errors.

Companies can achieve greater operational stability by analyzing and continuously improving critical variables affecting the workforce. This creates a work environment that supports a constant and efficient production flow, which is fundamental for sustainability and long-term growth.

Essential machine reliability: reducing downtime and increasing productivity

Machine stability is a critical factor for the productivity and efficiency of any industrial operation. Overall Equipment Efficiency (OEE) is a crucial performance indicator directly reflecting this stability. A low OEE can indicate significant issues that need to be addressed, such as availability, performance, and quality losses.

To ensure machine stability, it is necessary to define and monitor the equipment’s operational time, when it is planned to run. This operating time is crucial as it is used for calculating the takt time — the pace that aligns production with customer demand.

Availability losses are often the main problem, with unexpected stoppages or breakdowns that can significantly impact machine stability. An 80% or more availability rate is generally considered sufficient to initiate a flow project. However, it is not just the average availability that matters but also the variability around this average, known as the standard deviation, which can be a significant obstacle to the efficient process flow.

Types of losses affecting equipment availability

Increasing OEE (Overall Equipment Efficiency) requires specific actions, particularly in machines acting as a pacemaker for pull logistics systems. These are machines that define the capacity of the entire logistics chain and are essential for production planning.

Gemba Kaizen workshops are an effective strategy for addressing significant losses and starting to sort out the most critical problems. A detailed analysis of the reasons behind equipment failures, using techniques such as the 5 Whys or the Ishikawa diagram, is essential to understand root causes and develop appropriate corrective measures.

To address machine stability issues, it is vital to form dedicated groups that include representatives from the maintenance department. It is also critical to involve operators, production supervisors, and quality control to address defects.

By addressing these fundamental issues and implementing effective visual management standards and the SDCA (Standardize, Do, Check, Act) cycle, organizations can solve many problems related to staffing and equipment stability. This leads to a more reliable workflow and increased productivity.

Essential materials reliability: streamlining inventory to optimize flow

Issues often compromise essential materials’ reliability with the supply and availability of components necessary for operation. Production can be delayed or even stopped when essential parts or raw materials are missing, or when suppliers fail to deliver on time.

Applying the principles of stability to the materials flow reveals that when the level of stockouts is high, or supplier service is not good enough, an inventory buffer may be needed to ensure material flow. At the beginning of a pull flow project, it is essential to identify and resolve significant issues related to material shortages. The improvement team focused on this area usually includes planning and logistics departments, which are responsible for ordering materials and managing them to their point of use.

In many cases, only a system change can solve chronic supply problems. Quick and effective results can be achieved by using a list of the main material-related issues and applying the PDCA (Plan, Do, Check, Act) improvement cycle.

When dealing with supply chain and logistics challenges, it is advised to consider solutions from the Total Flow Management (TFM) model, as they can resolve most material supply issues. However, it is crucial to be realistic when assessing whether a specific material stability issue deserves to be addressed, as not all problems will be solved with the same approach.

The Kaizen Institute’s experience indicates it is often better to create a problem-solving system that deals with the most common causes of supply interruptions. This approach will ultimately resolve most issues and address others at the same time. It is also good practice to regularly check for delivery problems with suppliers or within internal and external logistic processes, to ensure material flow and operational stability.

Essential methods reliability: systematically identifying and eliminating waste

Stable methods in industrial operations are directly linked to maintaining a continuous flow of materials and information, minimizing safety buffers, and promoting an accurate and efficient flow. Problems in method stability can show in various ways but are often related to quality and time constraints.

A method stability issue can severely impact if it occurs randomly, with significant variations around the mean, making these problems unpredictable and capable of stopping an entire production line. These issues may not be directly linked to a specific machine – which would be reflected in the machine’s OEE – but rather be a random problem with implications throughout the process chain.

In this context, if a new product is introduced, we must carefully evaluate the reliability of current methods to ensure their stability. Mixing a flow solution with the best parameters for a new process may not be ideal for initiating pull flow projects, as it requires extra consideration and detailed discussions to align both objectives.

The best way to start a pull flow project is with a stable and reliable process in terms of staffing, machines, materials, and methods.

Nevertheless, it is wise to always check the methods’ stability before initiating such a project when no new product is being introduced and where there are no significant changes in ongoing processes. This can be done by identifying substantial issues related to time, quality, safety, or ergonomics and conducting Gemba Kaizen workshops with dedicated groups.

These workshops are an opportunity to systematically analyze current methods, identify sources of waste, and work collaboratively to develop solutions that improve processes’ stability and efficiency. By consistently applying continuous improvement practices and waste elimination, operations can achieve stability that supports high productivity and consistent product quality.

More on workforce stability: empowering employees for lean operations

Often, the main obstacle to essential reliability is significant resistance to change from all involved—operators, middle management, and top management. This resistance can exhibit through a defensive reaction to any change proposal, highlighting potential obstacles and excuses. To overcome this resistance, it is essential to identify and understand its sources, which often lie in deeply ingrained habits and reluctance to deviate from long-established practices.

Implementing changes gradually and involving employees in the process can be an effective strategy. Starting a pilot or improving a complex operation can demonstrate the value of change and help alter employees’ mindsets. The 5S approach, named after the initials of the Japanese words Seiri (sort), Seiton (set in order), Seiso (shine), Seiketsu (standardize), and Shitsuke (sustain), is a powerful tool in this process, introducing incremental changes that can lead to significant benefits in productivity and error reduction.

When promoting staffing stability, it is vital to address not only the physical aspects of the job but also the psychological and cultural ones. Encouraging adherence to Kaizen principles and continuous improvement requires a planned effort of training and involvement at all organizational levels. Acceptance and commitment to the Kaizen principles of pull flow are essential for implementing sustainable changes.

Some companies refer to this approach as promoting a lean management system or fostering lean thinking. Developing a continuous improvement mindset and being able to change involves discussing and testing new ideas, often through Kaizen Events, where employees are directly involved in designing solutions.

Before taking any steps to improve flow in an organization, it is crucial to assess essential human reliability and define measures for its improvement. This lays the groundwork for successfully implementing lean production systems and creates an environment where operations are more efficient, employees feel empowered, and they are an integral part of the continuous improvement process.

Integrating continuous improvement and the 4Ms for sustainable growth

Integrating continuous improvement with the 4Ms — workforce, machines, materials, and methods — is essential for sustainable growth in companies. The Kaizen philosophy, focusing on incremental and systematic improvements, is the foundation for this holistic approach.

The combined effect between continuous improvement, Kaizen practices, and the 4Ms produces an operational framework that not only adapts and improves in response to market changes but also thrives, ensuring sustainable and competitive growth in today’s fast-paced environment.

As organizations evolve, they face unique challenges and opportunities that require prompt and innovative responses. By systematically applying the Kaizen philosophy, the ability to respond flexibly to such challenges becomes a core competency.

In this way, companies can transform challenges into competitive advantages, ensuring that growth is achieved through operational efficiency, business model evolution, and additional value for customers and stakeholders.

Adaptation and growth are based on optimizing what is already known and exploring what can still be discovered and improved.

Strategies for continuous waste identification and elimination

For ongoing identification and elimination of waste, companies can adopt various effective tools and strategies within the scope of their continuous improvement:

  • Value Stream Mapping – VSM: This technique is used to visualize the materials flow and information necessary to deliver a product or service to the customer. VSM helps identify where value is added in processes and where waste arises, providing a solid foundation for improvements.
  • Gemba Walks: this practice involves visiting the shopfloor where the work is performed to observe processes firsthand. This method allows for identifying problems and improvement opportunities from a direct and practical perspective.
  • Ishikawa Diagram (cause and effect): the fishbone diagram tracks the root causes of a specific problem or quality failure, leading to a better understanding of eliminating waste.
  • Standard Work: establishes clear and consistent procedures for each operation and ensures that tasks are carried out efficiently and effectively, minimizing variability and waste.
  • Pull Systems: Unlike traditional push systems, pull systems ensure products are manufactured only in response to actual demand, which helps reduce overproduction and unnecessary inventory.

When integrated into a continuous improvement framework, these strategies allow companies to create a positive cycle of assessment, action, and reassessment, leading to leaner operations and sustained growth.

Still have questions about Kaizen and reliability principles?

What is the Kaizen philosophy?

Kaizen is a Japanese word meaning “change for better” or “continuous improvement.” This concept is a philosophy applied to lean management focused on the continuous improvement of processes at all levels of an organization, involving all employees. This methodology is characterized by small, incremental changes made regularly instead of significant, one-time transformations. The goal is to optimize workflow, reduce waste, and increase efficiency and productivity.

What are the 4Ms?

The 4Ms of essential reliability represent the following elements — Manpower, Machines, Materials, and Methods — and are fundamental in many production systems and quality management. Within lean production and Kaizen philosophy, the 4Ms are critical aspects that should be analyzed and optimized to ensure efficiency and quality. An organization can reduce errors, improve workplace safety, and increase customer satisfaction through continuous improvement in these areas.

What is lean production?

Lean production, or lean manufacturing, is a methodology that aims to minimize waste within a production system without compromising productivity. This methodology can be applied in various sectors, not just in production. The idea is to create more value for customers with fewer resources, identifying and eliminating waste in processes, such as overproduction, waiting times, and defects, by implementing pull systems and tools, for example, Standard Work.

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