Continuous improvement: How to build a resilient organization
Continuous improvement (CI) is how leading organizations maintain their competitive edge while navigating ongoing economic uncertainty. Find out more about what it is and how to measure it; the benefits it can bring your organization; where to start your CI journey; and how to ensure its success below.
Discover more about how continuous improvement applies to your organization:
Continuous Improvement Methodologies
From Lean Six Sigma, Kaizen and 5S to tools like DMAIC and PDCA, continuous improvement methodologies provide the framework for the delivery of manufacturers’ processes and systems, workforces and technologies.
Continuous Improvement Strategy
A continuous improvement strategy helps manufacturers develop and implement the best practices they need to become world-class organizations unafraid of – and strengthened by – change.
Continuous Improvement in Manufacturing
Integrating ongoing improvement into day-to-day business philosophy has played a key role in driving many leading manufacturers and industrial companies across the world to new heights in business performance and ROI.
Continuous Improvement Culture
Creating buy-in and getting everyone in your organization engaged and involved in making small gains consistently is the essence of a successful CI transformation. Here’s what a vibrant CI culture looks like.
Continuous Improvement Journey
The journey of continuous improvement is an ongoing cycle of improving competitiveness, consolidating gains and measuring performance. All actions need to be sequenced carefully, managed consistently and reviewed at regular intervals to ensure optimal impact.
Continuous Improvement Planning
Your strategy must plan for how cross-functional collaboration will be promoted; how tasks are assigned toward integrative improvement; and an assessment of your organization’s current level of digital maturity, and what skills and technology gaps need to be filled.
Continuous Improvement System
While most manufacturers face similar concerns regarding consumer behavior, increased competition and digitalization, their organizational requirements and approaches to CI will differ. Choosing the right system helps organizations build competitive advantages, now and into the future.
Continuous Improvement Process
To make organizations more resilient, agile and resourceful, a rigorous CI process providing strategic direction needs to be implemented. Building this organizational DNA supports digitalization and automation optimizing all functions to work as one and deliver superior service.
What does continuous improvement mean?
Continuous improvement (CI) is an organization’s ongoing efforts to improve all its processes, practices, products and services. It is often realized through small, steady and incremental improvements, but big breakthrough improvements are also possible. A world-famous example of a continuous improvement approach in action is the Toyota Production System (TPS).
The global manufacturing industry holds the TPS in high esteem – and for good reason too. Its lean philosophy underpins an efficient methodology that creates more value without generating waste. The result is an entire organization working together to continuously improve the way it works to ensure superior customer satisfaction.
Why is continuous improvement important?
The advent of advanced technologies such as artificial intelligence (AI), automation, machine learning, data analytics, the Internet of Things (IoT) and robotics has transformed manufacturing operations. As a result, organizations have had to digitalize their operations and move from a traditional, function-focused production system to a modern, digital operating system (DOS).
A DOS is the next generation in production systems specifically geared to support digitally transformed or transforming manufacturing operations. It’s designed to merge lean and smart principles for ultimate efficiency and agility.
In this digital age, a continuous development approach is more important than ever before. Digital transformation is a complex organizational transition. With a CI culture firmly in place, manufacturers can position the shift to a DOS as positive change and encourage holistic buy-in through inclusive improvements and innovations. This enables them to mitigate disruption, remain competitive throughout the digitalization process and achieve sustainable success.
How does continuous improvement work?
For CI to succeed, for it to strengthen an organization’s competitive position, it needs all employees to be involved and working together toward the same goal. To create a culture of continuous improvement, organizations need to:
- Ensure a committed leadership
- Involve and empower their employees
- Recognize the value of incremental improvements
- Focus on the customer
- Measure improvements
- Share ideas, collaborate and celebrate successes
How leaders lead is a crucial component of CI. As such, there needs to be a shift in leaders’ focus from running the business “as a boss” to improving the business “as a colleague”. Continuous improvement solutions are brought to life and sustained by leaders who, through their own behaviors and actions, encourage their teams to embrace positive change.
There is a method to activating a continuous development approach and maintaining momentum. Organizations can use these six steps to integrate CI processes into their operations. Continuous improvement needs to be sustained in a continuous cycle; organizations move seamlessly from step 1 to step 6 and back to step 1 to ensure that efforts are ongoing.
What are the benefits of continuous improvement?
The primary benefit of continuous improvement is that it improves an organization’s resilience. It achieves this through a range of other benefits that impact the business.
|Operational excellence||Products and services that anticipate customer needs, resulting in better customer service|
|Competitive advantage||Improved flexibility and responsiveness by streamlining all processes|
|Empowered employees||A proactive learning culture that encourages everyone to keep up with new technologies and trends, share knowledge and drive innovation|
|Reduced costs and wastes||Increased revenue|
|World-class maturity and capabilities||Successful digital transformation with limited to no disruptions during the transition|
|Improved product quality||Fewer defective products and production errors|
How do you measure the benefits of continuous improvement?
The impact of continuous improvement efforts is measured in tangible outcomes that directly affect a manufacturer’s bottom line. These key performance indicators (KPIs) can apply to various business objectives in the following ways:
|Improvement area||Example of what to measure|
|Production costs||Volumes of water consumption|
|Employee health and safety||Number of factory floor incidents|
|Quality control||Amount of defected product returns|
|Customer satisfaction||Customer retention|
|Competitiveness/ market position||Time to market|
Every organization will have its own set of KPIs that relate to its particular set of objectives. However, success can be broken down into three business segments: Customer, Cost and Cash.
Typical ROI achieved through an integrative CI solution
How do you ensure the success of your continuous improvement approach?
Continuous improvement efforts pay the highest dividends when the philosophy of continuous development and improvement is embedded into an organization’s cultural DNA. This supports a steady flow of incremental improvements that, when communicated company-wide, inspires employee engagement. When employees feel accountable in their work and empowered to innovate, they are much more motivated to put effort into making improvements.
Organizational leaders play a vital role in building a continuous improvement culture. Their actions, behaviors and commitment to CI influence employee confidence and buy-in. How leaders approach continuous improvement will determine their success at inspiring it among their teams, which ultimately determines the organization’s overall level of CI success. It is a large responsibility but fortunately, leaders can follow these 8 focus areas to guide their teams.
What is the connection between integrative improvement and continuous improvement?
An integrative approach to continuous improvement is designed to ensure that improvement initiatives include everyone and impact the business as a whole. It supports the shift to a DOS by dismantling operational silos and integrating teams for faster, better results. Essentially, an integrative improvement approach:
- Arranges an organization around end-to-end processes that serve customer segments rather than functions
- Involves all employees in improving processes and systems
- Ensures committed leadership that actively encourages the right mindset and behaviors to support integrative improvement principles
- Embeds CI into the culture of the organization