The Lean Startup. Lean Manufacturing. Six Sigma. If you’re a student of entrepreneurship and organizational efficacy, you know there’s one principle that has been the key to success for thousands of companies — Kaizen. But if you’re like most people, you probably haven’t heard of Kaizen. That’s because Kaizen is actually a Japanese word that literally means “improvement,” but today most people use it to mean “continuous improvement.”
Born in Times of Trouble
Despite being a Japanese word, the concept of Kaizen actually originated in America during World War II when the government enlisted business process experts to make various industries more productive in support of the war effort.
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Not only did American industry need to get better quickly in order to keep up with the demands of the war effort, it needed to do so on a shoestring budget. This combination of dire need and extreme constraint led to the concept of “small steps.” America had neither the time nor the money to radically revolutionize its industries from the ground up. Instead, proponents of Kaizen implored floor managers and line workers alike to make small changes, wherever they could, whenever they could, for as long as they could.
After the war was over, the US brought these same experts to Japan to help rebuild their economy. Japanese industry, led by Toyota, embraced Kaizen as part of what would become known as Lean Manufacturing, which was instrumental to propelling the Japanese auto industry to prominence by the 1980s. Starting in the 1990s and continuing into the the 21st century, the notion of “lean” spread beyond manufacturing to software and eventually to a whole host of other industries.
So, what does Kaizen have to do with innovation? How does it help us be more creative and better innovators? No one (and no organization) is perfect. You may be doing a decent job at fulfilling your purpose, but no matter how good you are, you can always be better.
Kaizen codifies this mentality. It is the antidote to resting on your laurels. Which is much needed, because, honestly, it’s far too easy to slide into the complacency of stability-oriented organizations. Whether out of a sense of self-congratulatory accomplishment of how far you’ve come or out of a sense of weariness from the hard-fought battles it took to get there, one way or another there are times when we all find ourselves getting a little too cozy with the status quo. Instead, we need to have the humility to recognize that we still have farther to go and the optimism to believe that we can, in fact, get there. Kaizen instills in us the habit and the discipline to keep going, to keep on reaching for that improvement that’s just around the corner.
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And Kaizen is effective. Because Toyota embraced the principle of Kaizen, it put in place a series of practices that help it transform from a small, obscure auto manufacturer to the industry leader, producing more than 10 million cars per year — that’s more than GM, Ford, and every other automaker. In our own experience, we used the principle of Kaizen to quadruple the output of our product development team without increasing our headcount. Working at a startup, we quickly needed to develop products people would buy. Hiring more people wasn’t an option and neither was halting production for months so we could rebuild new infrastructure from scratch. So, Kaizen to the rescue. Every two weeks or so, we introduced one or two small changes to our process, and things would get a little bit better and our team would get a little bit faster. Over many months, the sum of these small changes added up to radical transformation. In fact, that team today is unrecognizable from the team when we started. All of the tools are different. All of the processes are different. We went from releasing new features once every three weeks to releasing new features twice a day. Despite everything that’s changed, there’s still one thing that’s stayed the same–the principle of Kaizen. Every few weeks, that team still gets together to come up with a couple of ideas to make things just that much better.
The initial practitioners of Kaizen (just like us) had no choice but to go small. But those constraints turned out to be a blessing in disguise. Without realizing it, we were playing into some of the most powerful forces in human psychology. Kaizen is so powerful and so effective across industries because it’s perfectly suited to form habits through the power of positive reinforcement. Because the steps we took to improve were small, we saw progress (small progress, but progress nonetheless) right away. And that felt good. Seeing our efforts pay off triggered the reward centers in our brains. Rapid, relatively easy actions, resulting in quick, positive results are a surefire way to get someone to keep engaging in those same actions. It only took a few cycles of reinforcement before Kaizen had become a deeply ingrained habit. Contrast that with months-long, rarely successful large change efforts, and we’ll take small steps any day.
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Another, less obvious way in which the principle of Kaizen helps organizations produce better innovations is that simply mixing things up is good for our creativity. How so? Kaizen, is constantly pushing us to try something new, and it turns out one of the fundamental aspects of the human spirit is that we’re all adventurers. We like exploring new things. We lean into the challenge. Our frontal neocortex is wired to make sense of the world, so when it encounters a new puzzle, it goes into overdrive to work things out. Put another way, new experiences, including Kaizen-driven changes, get our creative juices flowing.
We’re going to end this article with one of our favorite quotes. This one comes to us from Winston Churchill,
“To improve is to change. To be perfect is to change constantly.”
We couldn’t have said it any better. If you believe in getting better, that means you’re going to have to change. And then you have to keep it up. Perfection isn’t a destination, it’s a habit. And Kaizen, with its focus on small steps, is the best way to build that habit.