LEAN to Improve Series - The Benefits of Adopting a Continuous Improvement Approach

on April 1, 2022

Continuous improvement methodologies and business transformation

Imagine a workplace where productivity was constantly optimized, innovation was always pursued, and new opportunities were frequently discovered! This method of constant betterment - known as the continuous improvement approach - empowers manufacturers to operate on a higher level.

With the right culture, systems, and mentality, improvement becomes part of everyday work and can provide incremental value to businesses seeking a new route of competitiveness and achieving operational excellence.

What Is Continuous Improvement?

The continuous improvement process involves ongoing incremental improvements, where a manufacturing business continues normal business activities while constantly seeking out new opportunities to add value to products, services, and processes. While continuous improvement can accomplish major change over time, it is completely driven by the input of employees. Therefore, effectiveness relies on the team’s dedication to the process.

In the context of the Lean methodology, continuous improvement seeks to improve every operation in your company by focusing on enhancing the activities that generate the most value for customers while removing as many wasteful processes as possible. 

The Benefits of a Continuous Improvement Approach

A manufacturer that adopts the continuous improvement approach will see immeasurable benefits, including:

Increased Productivity

The continuous improvement approach focuses on eliminating waste, improving product quality and customer service, and driving efficiencies to optimize labor productivity. Therefore, implementing efficient processes to reduce waste is particularly important in the manufacturing industry, as downtime negatively affects delivery schedules, customer relations, and general internal operations.

One common form of waste is time spent waiting, whether its employees waiting for work orders or from work orders waiting for employees. Adopting a continuous improvement approach gives your employees the immediate tools they need to get work done to and can result in reduced downtime, improved customer service, increased cost savings, and higher profitability.

Improved Quality

Improvements usually impact multiple areas; for example, an idea that increases revenue may also improve customer satisfaction. One of the central purposes for implementing a continuous improvement approach is to further streamline processes to produce quality products. In fact, around 54% of all improvements impact quality, which in turn boosts other metrics like customer satisfaction and streamlines the overall manufacturing process; this is a crucial benefit you’ll enjoy when implementing a continuous improvement approach to manufacturing operations!

Lean manufacturing is a production theory that emphasizes the elimination of waste in all forms. Resource expenditures that do not contribute to the value of a product as defined by the customer are wasteful in a lean manufacturing environment. When waste elimination is the goal, the results are an improvement in customer service, efficiency, and the overall quality of the products a business manufactures.

The continuous improvement approach not only eliminates wasteful steps that add no value, but also eliminates the quality problems that stem from this cost, time, and resource drain. Many manufacturing companies have an established and proven process to handle job quotes and orders, formalized training for new employees, as well as metrics and criteria to determine overall quality and efficiency. Further, they have measures in place to mitigate production risk and manage customer feedback.

Reduced Costs

The average impact of a cost-saving idea is $31,043 in its first year of implementation. Your factory staff can be a great source of ideas for improving processes that help reduce costs. Be sure to talk with workers on the shop floor to discuss ideas regarding points of process improvement. Because workers on the shop floor are the ones constantly using the processes, they have valuable insight into how things can be simplified or optimized to generate value.

Decreased Delivery Times

The average impact of an improvement that saves time is almost one hour per day - 270 hours in its first year of implementation. On-time delivery is one of the most important expectations to meet with customers. Many manufacturing businesses are required by customers to consistently demonstrate a high service level -- often 95% or higher. 

Many metrics are used to help develop a supplier’s performance to higher levels, including quality, timeliness, delivery, cost, and compliance. Perhaps the single most important metric of all is on-time delivery -- if you can’t meet your customer’s expectations and deliver on time, then they will often find another supplier who can.

Improved Employee Satisfaction & Morale

A Gallup poll of US workers in 2020 showed that just 20% of employees were engaged in their job. That means an average of 80% of employees aren’t engaged, and this is a vast opportunity for improvement as there are many financial benefits to having employees care about their work.

A lean and continuous improvement program hits directly at this problem. At its core, continuous improvement is designed to empower employees to solve problems that bug them and gradually improve the efficiency of their work processes. This methodology indicates to employees that their ideas are important. When an employee makes a suggestion for improvement, the idea can be carefully tested; and if successful, implemented company wide. This changes the employee’s role and responsibilities from being a passive actor to being an active participant in the business processes.

Reduced Employee Turnover Rate

Did you know that more than half of employees are actively seeking new roles elsewhere? 

​​Turnover in organizations is expensive in terms of time, energy, and resources, as the company must pay for recruiting, hiring, and training someone new to do the job. In some jobs, it can take several months or even years of on-the-job training for an employee to gain the necessary experience to excel at their job. Employees who actively participate in the betterment of the company gain a sense of pride and accomplishment, which is a cornerstone facet of the continuous improvement approach. This leads to a greater sense of belonging and fewer reasons to leave the organization.

How Kansas Manufacturers Can Implement Continuous Improvement Practices

There are a few different methods to implementing a continuous improvement approach in your manufacturing business. Some utilize lean manufacturing, other Six Sigma or the Theory of Constraints.  Each of these has a tool in common - the root-cause-corrective-action model.

Among the most widely used tools for continuous improvement is a four-step quality assurance method—the plan-do-check-act (PDCA) cycle:

Plan: Identify an opportunity and plan for change.
Do: Implement the change on a small scale.
Check: Use data to analyze the results of the change and determine whether it made a difference.
Act: If the change was successful, implement it on a wider scale and continuously assess your results. If the change did not work, begin the cycle again.

Check out our EVENTS page for LEAN to Improve Series webinars and trainings for additional Continuous Improvement expert insight and actionable recommendations. 

KMS's Continuous Improvement expert is here to answer your questions or come by your facility to provide a Continuous Improvement assessment.  CONTACT us to get your questions answered or REQUEST an assessment today!

 

Lean methodologies and business transformation
Gregg Profozich

Gregg Profozich is a manufacturing, operations and technology executive at Kansas Manufacturing Solutions' peer MEP Center in California, CMTC.  Gregg believes that manufacturing is the key creator of wealth in the economy and that a strong manufacturing sector is critical to our nation’s prosperity and security now, and for future generations. Across his 20-year plus career in manufacturing, operations and technology consulting, Mr. Profozich helped manufacturing companies from the Fortune 500 to the small, independents significantly improve their productivity and competitiveness.