Whether your business is a startup or a multinational corporation, understanding the importance of continuous improvement is a key component of Lean and Agile methodologies. Using it at a small scale can help your team operate more effectively. Implementing it at a large scale, as a top priority, can help your business stay ahead of the competition.
The most successful companies are never satisfied with the status quo. They constantly have their eye on the next innovation, the next level of performance. They know the importance of continuous improvement in all areas of the business.
Even if things are going really well, people at successful organizations are looking at what could be improved upon so that they can perform better. They are finding ways to work smarter, not harder, in order to be more efficient and profitable. The most successful companies are always innovating and developing new ways to deliver top-notch quality to their customers.
But this kind of behavior doesn’t just happen. Sure, some people have a natural drive to keep improving their skills and the results they produce at work. But many people prefer to stay in their comfort zones, never questioning the way things are done.
Companies must communicate the value and importance of continuous improvement and build it into every aspect of the business as a disciplined strategy. They must train their employees to study internal processes and create ways to make them more efficient. They must study their successes and failures regarding their customers and act based on those learnings to go above and beyond customer satisfaction. In today’s fast-moving and competitive landscape, this is a critical factor of most leading companies.
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The Importance of Continuous Improvement in Lean and Agile
The practice of continuous process improvement, or Kaizen, was developed to improve Japanese manufacturing processes through lowering costs and improving quality. Kaizen translates to “change for better,” a simple concept that is now used by companies all over the world at individual, team and organizational levels. Some companies may practice it as its own concept, but you will mostly find it integrated in companies operating within Lean and Agile methodologies.
The concept of continuous improvement is an important element found in both Lean and Agile practices. In the Seven Principles of Lean Development, continuous improvement is weaved throughout. The principles of Building Quality In and Reducing Waste, for example, require a mindset of continuous improvement. In Agile, it shows up in iterative development and shortened feedback loops, among other principles.
What is Continuous Improvement?
The term seems fairly simple, but how does it really play out? What does continuous improvement look like when it is implemented in a business environment?
The most commonly used model is PDCA: Plan, Do, Check, Act. Walking through these four steps can bring improvements to any process.
In this first step, the focus is on defining the problem and coming up with an approach that you will test in order to solve the problem, asking questions like:
- What is the scope?
- What is the target?
- What is the best approach for the outcome you are trying to achieve?
This includes defining a team and planning a timeline.
You can use this step to execute a full plan, or to implement a pilot solution at a smaller scale. Either way, this is the opportunity to experiment; try something new to see if and how it works. The key here is to record the steps taken in the process and collect data and feedback along the way.
This is the opportunity to study the chosen approach and evaluate the results, compared to your expectations when planning. Ask questions like:
- Was the approach successful / effective?
- Did it work as planned? Why or why not?
- What worked and what didn’t work?
If the approach was unsuccessful, you can go back to the first step (planning), considering what you learned and why it didn’t produce the intended results. If it was successful, you can proceed to the next step.
Now that you’ve taken the learnings and feedback from the previous steps, it’s time to implement the new solution fully. Remember, this doesn’t mean it’s the final solution or the only approach. Instead, it becomes the new baseline against which you will continue to measure for future improvements.
Much of the importance of continuous improvement lies in what a business does after they’ve cycled through the steps outlined above. In a typical business environment, when improvements are made in a process, those improvements become “the way things are,” not to be questioned until something goes wrong. In continuous improvement methodology, every improvement becomes the new baseline for the next.
This PDCA cycle is straightforward, and the importance of continuous improvement is fairly obvious, but how do you implement it in a business that is not currently practicing it, or is unfamiliar with Lean and Agile methodologies?
Companies implement continuous improvement in various ways and to various degrees. It takes a large commitment to embed the methodology into the foundation of a company, but as we mentioned earlier, it doesn’t have to be used at a large scale in order to be beneficial. It can begin on a small scale, with one team or in one department, and then expand from there into other areas of the business.
You can include continuous improvement in your day-to-day practices or hold “rapid improvement events” once every few months to work on specific areas of focus.
Regardless of the degree in which you practice continuous improvement, the results will show up incrementally over time. The key is to start somewhere; pick an area of your business that needs refinements and see how the methodology works for you.
The Importance of a Continuous Improvement Mindset
As with any new process, it can be daunting to think about implementing an unfamiliar methodology. In this case, it is more about shifting the mindset rather than adding a process that people need to learn.
Continuous improvement does not have to add to your workload; it shouldn’t create extra steps nor take extra time to implement. The steps are meant to be embedded into the work that’s already being done.
And this doesn’t mean you have to force change on processes that are working well. There are always areas of the business that can use improvement and the point is to look for those areas. Remember, continuous improvement is a mindset, not an additional task.
Benefits of Continuous Improvement
You may still be asking, “why do continuous improvement?” Depending on the size of your company and the degree to which it is implemented, you may see various results. Below are some common benefits that have been gained as a result:
- Improved product quality
- Increased efficiency and productivity
- Decreased cost
- Reduced waste
- Employee satisfaction and teamwork
- Customer satisfaction
As you could surmise from the list above, the advantages of continuous improvement can be exponential. In addition to financial benefits, employees who work on improving the company tend to feel more personally accomplished, leading them to staying longer at the organization and producing more impactful results.
Technology and innovation continue to progress more quickly than ever before. If you stick to what you know and what has always worked, you will quickly be behind. Adopting a mindset of continuous process improvement will put your business on a different, more successful trajectory.