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Difference between revisions of "Continuous Process Improvement (CPI)"

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== Continuous Process Improvement (CPI) Model<ref>Four continuous improvement models [https://www.investorsinpeople.com/knowledge/continuous-improvement-models-four-great-options-for-you/ Investors in People]</ref>
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== Continuous Process Improvement (CPI) Model<ref>Four continuous improvement models [https://www.investorsinpeople.com/knowledge/continuous-improvement-models-four-great-options-for-you/ Investors in People]</ref> ==
 
To do CPI, there are different models or approaches such as Juran Trilogy, PDSA cycle, Kaizen and 5S concept. Here we will discuss four models for continuous improvement, two with their history and basis in manufacturing, and two that are more recent developments.
 
To do CPI, there are different models or approaches such as Juran Trilogy, PDSA cycle, Kaizen and 5S concept. Here we will discuss four models for continuous improvement, two with their history and basis in manufacturing, and two that are more recent developments.
 
*Six Sigma: The aim of Six Sigma is to minimize faults, defects and any variation from the established process so as to increase the overall quality of outputs. The term denotes the ratio of faulty products expected per million units, which is 3.4, or to put it another way, a 99.99966% success rate. Six Sigma uses one of two methodologies depending on whether it’s being implemented to improve an existing business process (DMAIC) or create a new one (DFSS). Within these methodologies, a range of quality management tools and workflows are used, including the Five Whys, axiomatic design and cost-benefit analysis. One of the well-known features of Six Sigma is the various roles needed within the organization, including Master Black Belts, who work full-time within a Six Sigma program as in-house coaches, and Champions, who take overall responsibility for the implementation of Six Sigma.
 
*Six Sigma: The aim of Six Sigma is to minimize faults, defects and any variation from the established process so as to increase the overall quality of outputs. The term denotes the ratio of faulty products expected per million units, which is 3.4, or to put it another way, a 99.99966% success rate. Six Sigma uses one of two methodologies depending on whether it’s being implemented to improve an existing business process (DMAIC) or create a new one (DFSS). Within these methodologies, a range of quality management tools and workflows are used, including the Five Whys, axiomatic design and cost-benefit analysis. One of the well-known features of Six Sigma is the various roles needed within the organization, including Master Black Belts, who work full-time within a Six Sigma program as in-house coaches, and Champions, who take overall responsibility for the implementation of Six Sigma.
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*“Fail fast, fail forward”: This is about relentlessly moving towards better solutions by making and learning from mistakes quickly, comfortable that as long as you are going in the right direction failures are simply steps on the path to success. It’s important to understand what it means: it’s not about failing with the big overarching ideas or driving force behind your business, but about tinkering with the small things as you move towards optimal solutions. The phrase has achieved some controversy in recent years, but it’s more the semantics that have come in for criticism rather than the idea. Rob Shelton, global innovation chief at PwC, said that the idea is better represented by a ‘Darwinian engine’ beating at the organization's heart, driving forward repeated testing and dropping of ideas that don’t work. He takes issue with the word ‘fail,’ which has negative connotations, and instead likens the principle to the scientific process: developing a hypothesis, testing, re-hypothesizing and refining. Ultimately this phrase is underpinned by a belief that fearless exploration of new ideas in the right no-blame culture yields innovative results. It’s not about chasing failure but learning experientially.
 
*“Fail fast, fail forward”: This is about relentlessly moving towards better solutions by making and learning from mistakes quickly, comfortable that as long as you are going in the right direction failures are simply steps on the path to success. It’s important to understand what it means: it’s not about failing with the big overarching ideas or driving force behind your business, but about tinkering with the small things as you move towards optimal solutions. The phrase has achieved some controversy in recent years, but it’s more the semantics that have come in for criticism rather than the idea. Rob Shelton, global innovation chief at PwC, said that the idea is better represented by a ‘Darwinian engine’ beating at the organization's heart, driving forward repeated testing and dropping of ideas that don’t work. He takes issue with the word ‘fail,’ which has negative connotations, and instead likens the principle to the scientific process: developing a hypothesis, testing, re-hypothesizing and refining. Ultimately this phrase is underpinned by a belief that fearless exploration of new ideas in the right no-blame culture yields innovative results. It’s not about chasing failure but learning experientially.
 
*Perpetual beta: Perpetual beta represents a mindset and strategy based on the continuous improvement principle that a product, service or solution can never be perfect or completed. It has its origins in software development where the preferred method for delivering software to people has evolved from waiting until it’s as good as possible before shipping it out to customers to shipping a product that is as viable as it needs to be and then, on receipt of constructive feedback, improving it continuously to keep up with the evolving demands of customers. Nowadays the term is used to describe any organization with a product or service that operates with a strong feedback loop between customer and organization, where improvements are made and rolled out quickly, and where the improve/test/review cycle guides how improvements are made.
 
*Perpetual beta: Perpetual beta represents a mindset and strategy based on the continuous improvement principle that a product, service or solution can never be perfect or completed. It has its origins in software development where the preferred method for delivering software to people has evolved from waiting until it’s as good as possible before shipping it out to customers to shipping a product that is as viable as it needs to be and then, on receipt of constructive feedback, improving it continuously to keep up with the evolving demands of customers. Nowadays the term is used to describe any organization with a product or service that operates with a strong feedback loop between customer and organization, where improvements are made and rolled out quickly, and where the improve/test/review cycle guides how improvements are made.
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=== Principles of Continuous Improvement Model<ref>Six Core Principles of the Continuous Improvement Model [https://blog.kainexus.com/continuous-improvement/6-principles-of-the-continuous-improvement-model KaiNexus]</ref> ===
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The continuous improvement model reflects the idea that organizations should undertake incremental improvements to services, products, and processes. It applies to every industry and size of business. Six central principles guide it:
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*'''Principle 1. Improvements are based on small changes rather than major paradigm shifts or new inventions''': This concept is essential because significant changes often feel frightening and destabilizing to organizations. By approaching change in small, incremental steps, the continuous improvement model reduces the fear factor and increases speed to improvement. When following this principle, the organization does not need to wait for a strategic shift or a new product release to begin to advance. Any idea that eliminates waste speeds production times, reduces defects, or allows employees to develop new skills, is worth exploring. In addition, this approach opens the door to consider small-scale proposals to improve processes and enable employees to do their best work.
 +
*'''Principle 2. Employee ideas are valuable''': The continuous improvement model relies greatly on employees, not only top management, to identify opportunities for improvement. This bottom-up improvement is effective because employees are closest to the problems and thus better equipped to solve them. When thinking of these two principles, consider the value of engaging your staff. If you ask everyone in the organization for ideas to create a new product line or revolutionize how they care for their patients, you're not going to get anything; staff members are focused on their day-to-day work. They, understandably, can't come up with monumental ideas at the drop of a hat. Instead, ask people what improvement they could make to save them 5 minutes a day. Then empower them to implement that improvement, and spread it to everyone else in the organization doing the same process. In this way, you can take a small idea that anyone could come up with and drive a significant impact. For example, say you get one idea from ten employees, each of which saves them five minutes per day. That's ten ideas. Share all ten of those improvements with one hundred other employees so that every one of them is now saving fifty minutes per day (10 ideas x 5 minutes each). Another way to encourage employees to spot opportunities and implement improvements is to ask, "what bugs you?" Most complaints involve a delta between the current state and the employee's idea of how things should be. Sometimes the gripe includes a specific recommendation. It might go something like, "If they would just do X, Y, and Z, the problem would be solved." Sometimes there is no solution included. You might hear, "There's got to be something they could do to fix this!" Another way to encourage employees to spot opportunities and implement improvements is to ask, "what bugs you?" Leaders who adopt the Continuous Improvement Model do not shy away from employee complaints.
 +
*'''Principle 3. Incremental improvements are typically inexpensive to implement''': Employees tend to focus on small changes that can be accomplished without a lot of expense. In fact, many ideas from employees involve eliminating process steps rather than adding them, which is an excellent way to ensure that every activity adds some value to the customer and reduces wasted effort. Through examining detailed improvement data of a ton of organizations at every stage of the improvement journey around the world, in nearly every industry, KaiNexus discovered that 1.4% of improvement ideas have an impact of over $100,000, and each employee has an average annual impact of $25,000. So, not only are these ideas inexpensive to implement, but they can also have a massive effect on your bottom line.
 +
*'''Principle 4. Employees take ownership and are involved in improvement''': Getting people to change the way they've always done things is hard. Do you know what makes it easier? Rolling out changes that originated from the front lines. When people come up with ideas to improve their own work, they intrinsically see the value of the changes. Knowing that improvements come from their peers inspires faith in the necessity of the changes. By engaging your staff in the continuous improvement model, you empower them to take charge of their own work (but you help them as leaders). As a result, they're able to identify problems or opportunities for improvement, follow through on implementing their ideas, take credit for the work, and see a measurable impact from their efforts. In this way, the sole burden of improvement and process management is lifted from managers, who can spend their time more effectively coaching staff on improvement techniques and removing barriers to implementing changes. Because the continuous improvement model relies on employees for ideas for improvement, they become more invested in the outcome of the change, and employee engagement increases. This increases the chance of successful, sustainable improvement. Improved employee engagement also has a positive impact on retention, customer service, product quality, and recruiting.
 +
*'''Principle 5. Improvement is reflective''': Constant feedback is an essential aspect of the continuous improvement model. During every phase of executing an improvement, open communication is critical to both the final results of the improvement and the maintenance of employee engagement. Admittedly, this is tough to pull off in a traditional improvement culture. Coaches don't have the visibility they need to keep up with everyone doing the improvement work. Senior leaders can't engage without a major time commitment, meetings are tough to schedule, and communication gets buried in inboxes. Organizations with a more modern approach to improvement use continuous improvement software to improve visibility and team collaboration, giving coaches access to the reports they need to evaluate performance and target coaching. Senior leaders can follow the improvements that matter to them and engage quickly and easily. Staff can get the help they need from their managers without having to wait for a meeting or an email. Essentially, continuous improvement software gets everyone on the same page by improving visibility and streamlining communication. Another big advantage of an improvement platform is the ability to broadcast improvement success to the entire organization. When people see others recognized and rewarded for their work, they tend to double down on their own efforts.
 +
*'''Principle 6. Improvement is measurable and potentially repeatable''': It is not enough to simply make a change and call it an improvement. To achieve real success, the impact of change must be measured. This makes it possible to determine if the change can be applied successfully to other problems. Proving positive ROI also helps keep the organization aligned around improvement. Improvement can be measured (most easily with software) in terms of cost savings, revenue, time to market, customer satisfaction, safety incidents, collections, defect reduction, or almost any other key performance indicator for your organization. Making continuous improvement part of company culture is an excellent and cost-effective approach to tackling an organization's most complex challenges. When supported by improvement technology, results can be achieved quickly, and success can be sustained over time.

Revision as of 17:49, 19 January 2022

Continuous Process Improvement is defined as, “The ongoing improvement of products, services or processes through incremental and breakthrough improvements.” It doesn’t only mean that a business should make changes along the way when things aren’t working smoothly. Instead, continuous process improvement is an actual type of work style that is designed to continuously review results and rapidly adopt new measures when deemed necessary. The keyword here is continuous because ultimately broad-scale change and progress stem from small steps along the way that are all geared towards optimization. For some, it may be easy to conflate continuous process improvement as equivalent to other lean methodologies, including Kaizen and Six Sigma, for example. While these frameworks help to improve processes along the way, they can live inside the practice of continuous process improvement, but they are not the same. Two main philosophies exist for continuous process improvement - formalized and adaptive. Formalized continuous process improvement is typically in line with Six Sigma, in which you have a set of techniques that are enacted for a quantifiable financial return. Adaptive continuous process improvement may pull from lean methodologies and approach improving processes on a case-by-case basis.[1]


Continuous Process Improvement (CPI) Model[2]

To do CPI, there are different models or approaches such as Juran Trilogy, PDSA cycle, Kaizen and 5S concept. Here we will discuss four models for continuous improvement, two with their history and basis in manufacturing, and two that are more recent developments.

  • Six Sigma: The aim of Six Sigma is to minimize faults, defects and any variation from the established process so as to increase the overall quality of outputs. The term denotes the ratio of faulty products expected per million units, which is 3.4, or to put it another way, a 99.99966% success rate. Six Sigma uses one of two methodologies depending on whether it’s being implemented to improve an existing business process (DMAIC) or create a new one (DFSS). Within these methodologies, a range of quality management tools and workflows are used, including the Five Whys, axiomatic design and cost-benefit analysis. One of the well-known features of Six Sigma is the various roles needed within the organization, including Master Black Belts, who work full-time within a Six Sigma program as in-house coaches, and Champions, who take overall responsibility for the implementation of Six Sigma.
  • Kaizen: A Japanese word meaning ‘improvement,’ Kaizen’s ultimate goal is waste elimination. Its origins are in post-WWII Japanese businesses but it now used worldwide. It is an inclusive model of continuous improvement in that opportunities for improvement are expected to be identified by everyone from the CEO downwards – this is unsurprising considering its ubiquity in manufacturing, where front-line workers are often best able to spot inefficiencies in the production cycle. But what this also means is that there’s a distinctive cultural element to Kaizen and the implementation of processes and procedures must work alongside cultural re-alignment to the continuous improvement mindset in order to drive employee suggestions. When Kaizen is used for continuous improvement there are two distinct elements: flow kaizen and process kaizen. The former deals with how information, products and services flow throughout the organization, while the latter focuses on small changes individuals can make quickly to improve efficiency. Kaizen has many principles and makes use of underlying processes that include root cause analysis and PDCA.
  • “Fail fast, fail forward”: This is about relentlessly moving towards better solutions by making and learning from mistakes quickly, comfortable that as long as you are going in the right direction failures are simply steps on the path to success. It’s important to understand what it means: it’s not about failing with the big overarching ideas or driving force behind your business, but about tinkering with the small things as you move towards optimal solutions. The phrase has achieved some controversy in recent years, but it’s more the semantics that have come in for criticism rather than the idea. Rob Shelton, global innovation chief at PwC, said that the idea is better represented by a ‘Darwinian engine’ beating at the organization's heart, driving forward repeated testing and dropping of ideas that don’t work. He takes issue with the word ‘fail,’ which has negative connotations, and instead likens the principle to the scientific process: developing a hypothesis, testing, re-hypothesizing and refining. Ultimately this phrase is underpinned by a belief that fearless exploration of new ideas in the right no-blame culture yields innovative results. It’s not about chasing failure but learning experientially.
  • Perpetual beta: Perpetual beta represents a mindset and strategy based on the continuous improvement principle that a product, service or solution can never be perfect or completed. It has its origins in software development where the preferred method for delivering software to people has evolved from waiting until it’s as good as possible before shipping it out to customers to shipping a product that is as viable as it needs to be and then, on receipt of constructive feedback, improving it continuously to keep up with the evolving demands of customers. Nowadays the term is used to describe any organization with a product or service that operates with a strong feedback loop between customer and organization, where improvements are made and rolled out quickly, and where the improve/test/review cycle guides how improvements are made.


Principles of Continuous Improvement Model[3]

The continuous improvement model reflects the idea that organizations should undertake incremental improvements to services, products, and processes. It applies to every industry and size of business. Six central principles guide it:

  • Principle 1. Improvements are based on small changes rather than major paradigm shifts or new inventions: This concept is essential because significant changes often feel frightening and destabilizing to organizations. By approaching change in small, incremental steps, the continuous improvement model reduces the fear factor and increases speed to improvement. When following this principle, the organization does not need to wait for a strategic shift or a new product release to begin to advance. Any idea that eliminates waste speeds production times, reduces defects, or allows employees to develop new skills, is worth exploring. In addition, this approach opens the door to consider small-scale proposals to improve processes and enable employees to do their best work.
  • Principle 2. Employee ideas are valuable: The continuous improvement model relies greatly on employees, not only top management, to identify opportunities for improvement. This bottom-up improvement is effective because employees are closest to the problems and thus better equipped to solve them. When thinking of these two principles, consider the value of engaging your staff. If you ask everyone in the organization for ideas to create a new product line or revolutionize how they care for their patients, you're not going to get anything; staff members are focused on their day-to-day work. They, understandably, can't come up with monumental ideas at the drop of a hat. Instead, ask people what improvement they could make to save them 5 minutes a day. Then empower them to implement that improvement, and spread it to everyone else in the organization doing the same process. In this way, you can take a small idea that anyone could come up with and drive a significant impact. For example, say you get one idea from ten employees, each of which saves them five minutes per day. That's ten ideas. Share all ten of those improvements with one hundred other employees so that every one of them is now saving fifty minutes per day (10 ideas x 5 minutes each). Another way to encourage employees to spot opportunities and implement improvements is to ask, "what bugs you?" Most complaints involve a delta between the current state and the employee's idea of how things should be. Sometimes the gripe includes a specific recommendation. It might go something like, "If they would just do X, Y, and Z, the problem would be solved." Sometimes there is no solution included. You might hear, "There's got to be something they could do to fix this!" Another way to encourage employees to spot opportunities and implement improvements is to ask, "what bugs you?" Leaders who adopt the Continuous Improvement Model do not shy away from employee complaints.
  • Principle 3. Incremental improvements are typically inexpensive to implement: Employees tend to focus on small changes that can be accomplished without a lot of expense. In fact, many ideas from employees involve eliminating process steps rather than adding them, which is an excellent way to ensure that every activity adds some value to the customer and reduces wasted effort. Through examining detailed improvement data of a ton of organizations at every stage of the improvement journey around the world, in nearly every industry, KaiNexus discovered that 1.4% of improvement ideas have an impact of over $100,000, and each employee has an average annual impact of $25,000. So, not only are these ideas inexpensive to implement, but they can also have a massive effect on your bottom line.
  • Principle 4. Employees take ownership and are involved in improvement: Getting people to change the way they've always done things is hard. Do you know what makes it easier? Rolling out changes that originated from the front lines. When people come up with ideas to improve their own work, they intrinsically see the value of the changes. Knowing that improvements come from their peers inspires faith in the necessity of the changes. By engaging your staff in the continuous improvement model, you empower them to take charge of their own work (but you help them as leaders). As a result, they're able to identify problems or opportunities for improvement, follow through on implementing their ideas, take credit for the work, and see a measurable impact from their efforts. In this way, the sole burden of improvement and process management is lifted from managers, who can spend their time more effectively coaching staff on improvement techniques and removing barriers to implementing changes. Because the continuous improvement model relies on employees for ideas for improvement, they become more invested in the outcome of the change, and employee engagement increases. This increases the chance of successful, sustainable improvement. Improved employee engagement also has a positive impact on retention, customer service, product quality, and recruiting.
  • Principle 5. Improvement is reflective: Constant feedback is an essential aspect of the continuous improvement model. During every phase of executing an improvement, open communication is critical to both the final results of the improvement and the maintenance of employee engagement. Admittedly, this is tough to pull off in a traditional improvement culture. Coaches don't have the visibility they need to keep up with everyone doing the improvement work. Senior leaders can't engage without a major time commitment, meetings are tough to schedule, and communication gets buried in inboxes. Organizations with a more modern approach to improvement use continuous improvement software to improve visibility and team collaboration, giving coaches access to the reports they need to evaluate performance and target coaching. Senior leaders can follow the improvements that matter to them and engage quickly and easily. Staff can get the help they need from their managers without having to wait for a meeting or an email. Essentially, continuous improvement software gets everyone on the same page by improving visibility and streamlining communication. Another big advantage of an improvement platform is the ability to broadcast improvement success to the entire organization. When people see others recognized and rewarded for their work, they tend to double down on their own efforts.
  • Principle 6. Improvement is measurable and potentially repeatable: It is not enough to simply make a change and call it an improvement. To achieve real success, the impact of change must be measured. This makes it possible to determine if the change can be applied successfully to other problems. Proving positive ROI also helps keep the organization aligned around improvement. Improvement can be measured (most easily with software) in terms of cost savings, revenue, time to market, customer satisfaction, safety incidents, collections, defect reduction, or almost any other key performance indicator for your organization. Making continuous improvement part of company culture is an excellent and cost-effective approach to tackling an organization's most complex challenges. When supported by improvement technology, results can be achieved quickly, and success can be sustained over time.
  1. Definition - What Does Continuous Process Improvement (CPI) Mean? Solve Xia
  2. Four continuous improvement models Investors in People
  3. Six Core Principles of the Continuous Improvement Model KaiNexus