The Business Book

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be slow to catch up because during
the time it takes to develop, install,
and test new systems, companies
using kaizen have moved on,
boosting productivity to an even
higher level. This may be seen as
analagous to the fable by Aesop
in which the plodding tortoise
trumps the sprinting—then
delaying—hare. Increased
productivity achieved by kaizen
tends to be cheaper to obtain than
productivity growth achieved by
BPR. The source of kaizen
improvement is people. Employee
ideas are essentially free, unlike
expensive new machinery for a
new production system.

Is kaizen always effective?
However, in some companies
kaizen does not work. Middle
managers and supervisors who are
inclined toward an autocratic
leadership style typically resent
kaizen: they enjoy making all the
decisions and are sometimes

resistant to change. Individuals

with this mind-set will not want to

delegate decision making to factory-

floor workers. If their good ideas are

constantly ignored by managers,

employees will quickly become

disillusioned and stop contributing.

A company’s industrial relations

history can also affect the outcome

of kaizen. In general, the chances of

success with kaizen fall if there is a

lack of trust between the

management and the work force.

Employees may see kaizen in a

cynical way—feeling that the plan is

just another management ruse to

get more out of the work force

without offering anything in return.

Kaizen is built on the premise

that no production method is perfect;

systems can always be improved

through employee suggestions. But

is this always true? Logically,

businesses will try to use kaizen to

fix key problems first. It could be

argued that, over time, the benefits

of kaizen are likely to fall steadily as

DELIVERING THE GOODS

any new problems that are tackled

will be those previously considered

less significant.

The rewards of risk

Technology and consumer tastes

change. From time to time the

old product, and with it the old

methods of production, will need to

be discarded in favor of something

new and radical. Companies that

favor kaizen may tend to eschew

radical overhauls in favor of less

dramatic change. The danger here is

that they can end up being left

behind by their bolder rivals. A good

example of a company that suffered

as a result of this approach is Nokia.

For many years the Finnish

cell-phone company enjoyed great

success by sticking to its classic

design of “Candybar” phones.

However, in the meantime rival

companies such as Samsung and

Apple took greater risks, and as

a result, out-innovated Nokia,

taking away their market lead. ■

Aesop’s fable tells how the
tortoise wins a race against
the hare by slowly advancing to
the finish while the hare sprints
and then riskily naps. Kaizen
can be viewed as the tortoise,
making minor adjustments
daily, while the hare can be
viewed as BPR, making rapid,
dramatic changes.

The tortoise

demonstrates that

steady progress,

such as that

achieved using kaizen

methods, can be the

better approach to

winning the race.

The hare’s

overconfidence

causes him to lose the

race, much as the big,

bold changes wrought

by BPR can prove

less effective in

the long run.