The philosophy behind continuous improvement is simple: incremental and ongoing changes to your organization result in more efficient business processes, better products, and superior customer experiences.
The pursuit of excellence is familiar to many of us in our daily work, and your organization may already have a culture, goal, or process management method designed to improve performance and facilitate operational excellence.
But what’s simple in theory is often more complex in execution. And with the speed at which our world is changing, businesses need to adapt and evolve quickly. Many organizations assume that they need to make big, broad changes to address challenges or have a meaningful impact—an approach that’s often time consuming, hard to implement, and difficult to measure; a continuous improvement process is about doing the opposite. Continuous improvement is about taking an iterative approach to improvement that adds more value over time. It's an all-hands-on-deck philosophy that builds ownership, boosts innovation, and creates incredible customer experiences.
What is a continuous improvement process?
A continuous improvement process (CIP) is an ongoing and incremental cycle of improvement to products, services, and processes. It is a structured approach to continuous improvement that organizations can use to identify, define, implement, measure, and analyze the effectiveness of change.
Iterative by design, continuous improvement processes enable organizations to make an ongoing commitment to change that increases efficiency, product and service quality, and customer satisfaction more consistently. This continuous, iterative improvement goes hand in hand with innovation. Some of the most innovative and successful companies are those that rely on continuous improvement models to refine their products and processes over time.
Continuous improvement processes are often used in industries such as manufacturing, healthcare, and technology. But the concept can be applied to any organization that seeks to improve its operations and outcomes.
Why use a continuous improvement process?
Continuous improvement processes are about more than just efficiency. When fully adopted across an organization, continuous improvement breeds a culture of innovation and ownership that provides a competitive advantage and drives ongoing growth and success.
Implementing a continuous improvement process offers numerous benefits:
- Increased efficiency and productivity. With optimized business processes, your organization can do more with less, reducing operation costs and improving profitability.
- Superior customer experience. CIPs lead to better products and services and keep your customers’ needs top of mind. By committing to a culture of continuous improvement, you can delight customers with constant updates rather than playing catch up when something goes wrong.
- A more engaged and empowered workforce. CIPs provide opportunities for continued learning and growth for individuals and teams. Working together to identify areas for ongoing improvement leads to the development of new skills and knowledge, which strengthens your workforce and improves employee experience.
- Agility and resilience. A company culture committed to continuous improvement means that flexibility is built into the way your organization operates. This makes it easier to respond to changing customer needs, stay compliant with regulations, and adapt to market trends.
- Competitive advantages. Focusing on how to consistently improve results lead to more innovative products, services, and processes that outperform competitors and position your organization as a leader in the market.
Common continuous improvement process methods.
While there are many different methods, names, and implementations for continuous improvement models, they all share a common goal: strive to be better, always.
Plan-Do-Check-Act (PDCA)
Plan-Do-Check-Act (PDCA) is a four-step methodology used to identify, test, and implement changes to improve a process. Originally based on the scientific method, PDCA is a framework for continuous improvement that focuses on measuring and analyzing results to identify the actions needed for improvement efforts.
Sometimes referred to as the Deming Cycle or Deming Wheel, this method was developed in the 1950s by statistician and engineer W. Edwards Deming and is based on the “Plan, Do, See” model previously proposed by statistician Walter Shewhart in the 1920s. It was further refined by the Japanese Union of Scientists and Engineers into the framework used today. The method has also been adapted to PDSA—Plan, Do, Study, Act—in which “study” replaces “check” to emphasize a focus on analysis.
PDCA has four steps:
- Plan - Identify the problem or opportunity and determine a process for improvement.
- Do - Implement the process changes and collect data to measure the results.
- Check - Analyze the data to determine if the change had a positive impact.
- Act - If the change was successful, standardize the change and implement it on a larger scale. If it was not successful, make further changes and repeat the cycle.
Kaizen
Kaizen is a Japanese business philosophy based on the principle of continuous improvement. Recognizing that small improvements can have a ripple effect on other areas of the organization, the Kaizen method focuses on making incremental changes that are often easy to implement and track.
Kaizen is both a concept and a methodology. Japanese for “improvement,” the terms “kaizen” and “continuous improvement” are often used interchangeably. Both concepts share a goal of ongoing and incremental improvement and rely on the idea that small, gradual changes can lead to significant improvements over time.
The Kaizen approach builds upon the concepts of PDCA and was initially developed in manufacturing to eliminate waste, promote innovation, and increase employees’ sense of purpose. Toyota famously employs Kaizen in the Toyota Production System developed by Taiichi Ohno—a production control system designed to make vehicles in the quickest and most efficient way to expedite vehicle delivery to customers. Kaizen didn’t become popular in the west until the mid 1980s when Masaaki Imai, founder of the Kaizen Institute, solidified the concept in his best-selling book, Kaizen: The Key to Japan’s Competitive Success.
As a continuous process improvement method, Kaizen follows the implementation of five core principles:
1. “Know Your Customer” - Understand your customers’ interests, challenges, and pain points to improve the customer experience with better products or services.
2. “Let it flow” - Every process and every employee should focus on creating value and eliminating waste, with an ultimate goal of achieving zero waste.
3. “Go to gemba” - Gemba roughly translates to “place.” Follow the action to get a better understanding of how value is actually created and be more aware of what’s happening at every level of the organization.
4. “Empower people” - Organize teams and goals in a way that supports kaizen principles. And, provide employees with the systems and tools they need to achieve them.
5. “Be transparent” - In order to evaluate their success, the improvements you make should be measured and tracked with data.
Six Sigma
Six Sigma is a method designed to improve the quality of processes by removing defects and minimizing process variability, using data and statistics to analyze processes and identify areas for improvement. Six Sigma is based on a set of key principles and practices, including a focus on the customer, eliminating issues or defects, collaboration, flexibility, and continuous improvement.
The concept of Six Sigma was first introduced by Motorola engineer Bill Smith in the 1980s. Smith recognized that the traditional quality control methods used at the time were not effective at reducing defects in a consistent and efficient way. He proposed a new approach that used statistical methods to measure and analyze process data, with the goal of reducing the number of defects to less than 3.4 per million opportunities. Six Sigma has since evolved and spread beyond its initial use in the manufacturing sector, gaining more mainstream popularity after being adopted by GE.
Six Sigma contains two primary sub-methodologies:
- DMAIC (Define, Measure, Analyze, Improve, and Control) - used for improving existing processes or products that are falling short of customer needs or company standards.
- DMADV (Define, Measure, Analyze, Design, Verify) - used for developing new processes or products or for optimizing processes or products that have already been optimized but are still failing to meet expectations.
Lean
Lean methodology is used to optimize processes by eliminating waste and focusing on creating value for the customer. It is based on two core principles: continuous improvement and respect for people.
Like PDCA, Kaizen, and Six Sigma, lean has its origins in manufacturing, based on the lean manufacturing method developed by Shigeo Shingo and Taiichi Ohno used in the Toyota Production System. It has since been applied to a wide range of industries, including healthcare, finance, and service industries, and is frequently used by software companies to improve development. Often, lean is used in conjunction with other continuous improvement process methodologies, such as Kaizen or Six Sigma.
There are five basic principles of the lean methodology:
1. Identify value - Focus on what benefits the customers. This is what adds value to your products or services. Eliminate inefficiencies and waste.
2. Map the value stream - Identify and document all steps involved in the value creation process. Often, businesses use Kanban boards, but techniques like process discovery can help speed up value stream mapping.
3. Build efficient workflows - Identify and remove bottlenecks that are causing inefficiency in your workflows.
4. Develop a pull system - Create a queue for new work so it is only done when there is a demand for it. This helps optimize resources and reduce overproduction.
5. Continuously improve - Evaluate and iterate on the previous steps over time to address new challenges and build efficiency and adaptability into your processes.
Theory of Constraints (TOC)
Theory of Constraints (TOC) focuses on identifying the biggest bottleneck, or constraint, in a process in order to improve it. This concept hinges on the idea that identifying and addressing the biggest system constraint is the fastest path to improvement and continuous growth.
TOC uses a chain analogy to underscore the importance of identifying a system constraint: If you imagine that your processes are a connected chain of functions, the only way you can strengthen that chain is by identifying the weakest link. Making improvements to other parts of the chain will never solve the core issue, because your weakest link will still exist, jeopardizing the integrity of the entire chain.
The theory of constraints was developed by Dr. Eliyahu Goldratt. In his 1984 book, The Goal, he proposed five focusing steps to identify and eliminate constraints:
- Identify - Define the biggest bottleneck in your process.
- Exploit - Try to maximize the output of the bottleneck with your existing resources.
- Subordinate - Make sure the bottleneck is fully resourced so it can run optimally.
- Elevate - Invest additional resources to increase the capacity of the bottleneck.
- Repeat - Repeat the process with newly identified bottlenecks.
Since its conception, TOC has continued to be refined and adapted, resulting in a series of sub-methodologies, such as “Throughput Accounting” for performance measuring, “Thinking Processes” for root cause analysis, and a variety of other applications for specific industries and use cases.
How to implement a continuous improvement process.
Many organizations adopt a method or combination of methods, such as Kaizen, PDCA, Six Sigma, lean, or TOC, as the framework for continuous improvement processes.
Regardless of your specific approach, successful implementations of a continuous improvement process typically involve a variation of the following steps:
- Define the scope - Identify a process that needs improvement and establish goals and objectives for the improvement process. Remember that the best CIPs are those that focus on making ongoing, iterative changes, so try to start small.
- Select a team - Identify who will lead the CIP effort and choose representatives from different areas and levels of the organization, including managers, individual contributors, and frontline workers. This helps build employee engagement and ownership, a key step in creating a continuous improvement culture.
- Identify opportunities for improvement - Continuous improvement processes rely on process transparency to understand how current processes are executed—including who does what, when, and where. Analyze the processes to identify areas of waste, inefficiency, and opportunities by gathering data and using tools such as process mining software or process maps and cause-and-effect diagrams to identify suggestions for improvement.
- Develop the improvement plan - Once you’ve identified opportunities for improvement, create a plan for making changes that defines clear priorities, identifies measurable goals, and establishes a timeline.
- Implement - With the plan defined, it’s time to implement. Be sure to involve all stakeholders and communicate any changes as the project unfolds. And remember, continuous improvement is about making changes and learning from them—it’s okay if you run into some bumps in the road, as these can be addressed in the next iteration.
- Monitor - Track the progress of the improvements that you implemented and measure the results against the established goals and objectives. This step is the key to understanding what can be improved in the next iteration.
- Continuously improve - Identify new areas for potential improvement by reviewing the processes on a continual basis and documenting what you’ve learned from failures or setbacks. As new opportunities are identified, repeat the cycle or standardize the results to apply them to another area for improvement.
The process automation connection
Implementing a continuous improvement process is a commitment that takes ongoing effort and continued practice. But with modern technology and tools, CIPs can be implemented more quickly than they could have been in the past.
Technologies like data fabric, process mining, and process automation can all be used to gain end-to-end process visibility. This makes it easier to understand how your processes are currently running and where they can be improved. And when using platforms that combine these technologies, you can quickly implement changes and more easily measure, track, and act on the results.
Kiichiro Toyoda, founder of Toyota Motor Corporation, believed that “the ideal conditions for making things are created when machines, facilities, and people work together to add value without generating any waste.” By leveraging software that designs, automates, and optimizes complex processes, organizations can connect people and technology to continuously improve and drive ongoing innovation, growth, and success.
