How can a Kaizen process finance itself?

It often takes some effort to start a new improvement process, as it requires an investment, both in time and in cost. So is it worth it? Our answer would be a resounding YES. In this blog, we explain how a Kaizen process can finance itself - and how the revenue quickly outgrows the investment. 

What can Kaizen do for your improvement process?

Kaizen is a fantastic improvement method where improvements become visible and manageable. That’s the foundation of an effective and continuous improvement process. 

Kaizen:

• Offers structure for the whole organization
• Provides an improvement impulse to the whole company
• Is a suitable technique for both work floor and management
• Works with an effort/impact analysis to guide towards those savings that cost little and yield a lot
• Shows quick results with changes that require little or no investment, just a different way of working
• Offers the option to really start improving top-down and to realize a strategic goal quicker

Kaizen or Excel?

It's possible to do Kaizen on paper, on whiteboards, or in Excel. But you'll miss an overview within the department, within the company, and over more extended periods. You can't send reminders or have an overview of the whole process. Cierpa Kaizen does provide insight and grip on the improvement process. It simply gets you further as an organization. 

Cierpa Kaizen:

• Channels the flow
• Offers overview: everyone knows what to do and when to do it
• Monitors lead times
• Shows progress
• Facilitates prioritization based on impact/effort 
• Shows savings already achieved, but also future ones
• Offers great possibilities for analyses and reports
• Motivates the entire company to keep improving 

Improvement is an ongoing process; it's never over. Cierpa Kaizen keeps on delivering small and large improvements and savings. Our customers experience that too: after three years, up to 98% of them are still using Cierpa Kaizen!

Do the costs of a Kaizen process outweigh the benefits?

At the very least, a Kaizen process finances itself. Far more often than not, a Kaizen process makes money. Let's do the math.

A calculation: 

Cost

You'll probably need a one-time consultant for a proper Kaizen implementation. Let's estimate that at €20,000.

You'll also need software to support the process. That will cost you about €4,000 (you can find our Cierpa Kaizen price list here).

Return

Every organization is different, and so savings will vary. Here's a good estimate:

• Shigeo Shingo is considered one of the Kaizen founders. His motto: every employee who uses Kaizen saves $4,000 a year. How many employees do you have?
• Our Speedy Kaizen campaigns generate an average of over €50,000. With an average of 8 actions per year, Speedy Kaizen guarantees excellent results. 
• Even small Kaizen actions combined lead to significant savings. Our customers earn an average improvement of €25 per action. Some customers do up to 2,000-3,000 activities per year!
• Also, keep in mind that these are not one-time savings: every change will keep on working to your advantage in the future.

So YES, a Kaizen process is definitely worth the investment!