Understanding Gemba Kaizen Innovation

Never has there been a better time to unleash innovation in your organisation. There is a perfect storm that offers: an unprecedented amount of talented and entrepreneurial young people; accessible technology- many of it for free; and a colliding of ground-breaking knowledge which gives us a clear route forward; and customers who are accessible, around the world, because they are only a few clicks away from ordering.

There are two types of innovation:

  1. Gemba Kaizen innovation (innovation at the work face is a daily activity) which focuses on improving internal processes as a daily activity.
  2. Blue ocean innovation where an organisation moves away from the cut throat, dog eat dog bloody red oceans of competition to the clear, calm and rewarding waters.

The important use of Gemba in front of Kaizen reminds us that we need to start in the “real place: the operations.  Kaizen stands for continuous improvement. The foundation stones for this process are:

  1. Housekeeping
  2. Muda (waste) elimination
  3. Visual management
  4. Adopting Time Saving Techniques ( Adopting SCRUM meetings from the agile movement and value stream mapping)

1. Housekeeping

A surprising start to a new process but one that is emphasized in all the case studies in the book[i].  The benefits of housekeeping is that it highlights problems, helps ensure everything is where it should be thus saving time, and brings teams together.  Japanese organisations are known to start the day with a 15-minute tidy up where all teams work together both in and outside the premises. In a western culture this needs to be explained as the default future for all the staff is “This is what we have cleaners, gardeners etc for”.  Its significant is that it can be were 50% of the  errors occur.  There are Four Ss in Gemba Kaizen:

  • Sort: determine what is necessary and unnecessary and dispose of the latter.
  • Straighten: Put essential things in order so that they can be easily accessed.
  • Scrub: Clean everything, tools, workplace
  • Systemise & Self-discipline: set the standard, train and develop and maintain a culture where self-discipline:

Practical steps to embrace sorting:

  1. Select and area in operations and hold a training session on Gemba Kaizen from a local trainer.
  2. All staff after the training session are given red tags to place on all items that will not be used in the next 30 days. The rule being if in doubt red tag it.
  3. For those items that operations staff want stored in their area they have to demonstrate the necessity back to the group. Those hoarders will thus be challenged and a compromise reached.

Practical steps to embrace straighten:

I will never forget visiting the garage of one of my friends.  His dad had all his key tools hanging above his workbench with a stencil outline on the wall to show what tool was not back in its right full place.

Hospitals are particularly good at this as lives depend on it. During my visits to see my wife, who was in hospital for 105 days, I was impressed with the organisation of the blood extraction trolleys, nurses knew that everything was in its place.

In hospitals sensitization is very important.  Having a hand cleaner dispenser empty is of no use. So, they have a sticker on each unit which says, “Turn me over if empty”.  The label when turned over is red   and says “EMPTY”.  That is straightening at work.

  1. Set put specific places where tools and supplies should be.
  2. Label all areas where work in progress is placed indicating the maximum permitted level

2. Waste elimination

In lean methodology, there are eight types of waste.  These wastes are seen within the whole organization. I have outlined the eight wastes below in Exhibit 1

Exhibit 1: The Eight Wastes that Need Tackling

Eight types of waste
Over-production: Building batches of products larger than the customers’ immediate need. Printing marketing brochures in advance. This waste typically occurs because we want to increase utilisation of large and important machines, are worried about rejects and absenteeism so we produce more to be on the safe side. In just-in time systems being ahead of the production schedule is regarded as worse than being behind it.
Waiting: Production operators waiting because a machine has gone down or a component is not available. Or when the operators are simply monitoring the machine as it does its value adding task. Whilst operators being idle is easy to measure, it is more difficult when they are look busy. In one example in a German automotive manufacturer, the set-up time in the press shop was reduced from 10 hours a week to 3.5 hours.
Transportation: Moving materials around the factory. Any process physically distant from the main line should be incorporated into the line if possible. Masaaki Imai points out a common sign of a problem with layout is the need for conveyor belts. He goes on to say “The best thing a company can do with its conveyor belts is to sell it to their competition, or  send it to them free of charge.”
Extra processing: Processes that appear productive but are unimportant to the customer. Value stream accounting provides good guidance here. Do not include any costs and activities that do not add value to the customer. There are many ways an organization can have extra processing.

  • Monthly reports that are prepared for accountability purposes but are not read or used by the recipient
  • The majority of Excel spreadsheets that are a reprocessing of already recorded transactions
  • The chart of accounts where it holds more than 50 codes for the P/l
  • Annual planning processes that take months and are useless as soon as the ink has dried
  • Designing additional features into a product that the customers do not use e.g. many features in Excel are not used.
Excess inventory: Having materials, components, work-in-process, and finished goods levels above the immediate need. When an inventory level is high nobody gets serious enough to deal with problems like quality, machine downtime, and absenteeism, and thus an opportunity for kaizen is lost.

Also, with generally accepted accounting principles all finished goods carry prior months overheads into the future periods these goods were sold.  This carrying forward of costs to future periods leads to additional costs hitting the P/L when inventory levels fall.

Waste of motion:  Any motion of a person ‘s body not directly related to adding value is unproductive.  While very  evident in manufacturing environments it is of equal importance in all other environments.

  • Disorganized servicemen who do not have all their tools with them
  • Health workers double handling patient information
  • Office workers who cannot access previous work files efficiently
I recently witnessed a classic waste of motion activity in a hospital.  We were in the emergency department and my wife was having her blood pressure read.  Because my wife records could not be brought into the room the nurse , who was  wearing protective gloves had to write the temperature down on a scrap of paper and then transfer it to the file when back at their work station.

There are many ways an organization can have a waste of motion

  • Having to search for tools, parts, or forms
  • Handling something twice because
  • Writing reports when the data is available already in another source
Waste due to rework and rejects that have to be scraped: Rejects interrupt production and require expensive rework or have to be discarded. In addition, the need to have operators watching over high speed equipment is wasteful. A lack of adequate consultation in the design phase often leads to customer rejections and machining problems. There are many ways an organization can have a waste due to rework and rejects.

Reports that have to be rewritten are effectively rework.

Unused employee creativity: Employee ideas having to hurdle many obstacles before adoption. Based on Toyota, we would need to have 10 innovations implemented per team member per year.


3. Visual management

Toyota is famous for its “andon cord” if problems occur. Andon refers to the pull cord where any worker on the production line can stop production, and ask for help, if they see a fault that cannot be fixed by them or the next workers before it will be covered up by a panel.  Immediately lights flash and that part of the production line is halted.  The workers below are unaffected as there is a feed in line with about eight minutes of product to work on.  Trained engineers rush in and fix the problem.  They have up to eight minutes before the whole production line will be halted.  The ability of anyone to stop production and activate the flashing lights to get the roaming engineers to the spot quickly is a major advantage Toyota and other manufacturers have when using this visual control.

Visual control is an important principle for the finance team to master as many reports need a rocket scientist to read them.  Whereas if we adopted this Toyota principle we would make:

  • all reports so clear that nobody needs to ask questions about them – I call it passing the 14-year-old test
  • use some sort of “and on cord” like a “red cone” so staff, within the accounting function, can signal that they are having a problem that might delay an accounting process, at month-end / annual planning/ annual accounts
  • use of staff notice boards, screens in canteens to report progress

[i] Masaaki Imai, Gemba Kaizen: A Common Sense, Low-cost Approach to Management,  (McGraw-Hill 1997)

4. Adopting Time Saving Techniques

There are a number time saving techniques worth adopting

  1. SCRUM meetings from the agile movement
  2. Value stream mapping


Purchase David Parmenter’s toolkit which is on sale at USD 29.90 and comes with 15 electronic templates.

A ‘look inside’ the Innovation Toolkit

Contents page

A perfect storm 2

Understanding Gemba Kaizen Innovation 3

  • Housekeeping 3
  • Waste elimination 5
  • Visual management 7
  • Adopting winning methods 7

Blue Ocean Innovation 8

The five-step Blue Ocean Shift Model 9

  • Step 1: Get started 9
  • Step 2: Understand Where You Are Now 18
  • Step 3: Imagine where you could be 22
  • Step 4: Find how you get there 24
  • Step 5: Choose and make the blue ocean move 28

Selling and Leading Change. 31

  • Steve Zaffron and Dave Logan 31
  • Harry Mills’ Self Persuasion 32
  • John Kotter’s Leading Change 32
  • Selling A BOS Project to the Senior Management Team 33
  • Learn to Sell by Using the Emotional Drivers of the Buyer 34
  • The Elevator Speech 34
  • Deliver a Compelling Burning Platform Presentation 35

Wisdom from the great management thinkers. 37

  • Peter Drucker’s Lessons on Innovation 38
  • Jim Collins’s Lessons for Innovation 42
  • Jack Welch’s Lessons for Innovation 42
  • Thomas Peters and Robert Waterman’s Lessons for Innovation 43
  • Gary Hamel’s Lessons for Innovation 43
  • Jeremy Hope’s Lessons for Innovation 44
  • Tom Peters’ Lessons for Innovation 44


  • Establishing a BOS Project Team Checklist 48
  • Establishing BOS Team Questionnaire 50
  • BOS Team 360-Degree Questionnaire 53
  • “Just Do It” Culture and Process Checklist 55
  • Job Description for the BOS Team Leader 56
  • Skills and experience 56
  • Workshop Preparation Checklist 58
  • Guidelines to Running Workshops 60

The working guide can be purchased from