Constant Improvement: A Bad Idea?

Source: AICPA CPA Insider

The following includes excerpts, reproduced with permission, from an article by Justin Locke.

For those of you who are not familiar with Toyota Motor Corp.'s lean management philosophy, the “kaizen” portion of it refers to seeking “constant improvement.”

“Constant improvement” is one of those phrases that sounds absolutely wonderful and positive. Who could possibly object to it? Well, I hate to be such a cynic, but there's no such thing as a management tool that is absolutely positive.

So I would like to offer a counterbalancing management tool: knowing when to leave things the way they are.

If, as a manager, your top priority is “constant improvement,” this means you are focusing on what needs fixing more than what is already working just fine. There is a big danger here: It's easy to take fabulous work for granted and not notice how hard everyone is already working to maintain a very high status quo. Failing to appreciate heroic effort that is already happening is the first step to a drop in quality.

There is always the danger, when you have a policy/expectation that they must institute “constant improvement,” that people will satisfy that requirement by going out and looking for things to change and improve, some of which perhaps do not need to be changed or improved. The classic example is the changed taste of Coke. What a disaster “New Coke” was.

There is a tremendous appeal to making changes, simply because there is more money to be made by making changes, far more money than can be made by leaving things the way they are. But “constant improvement” should only apply to situations that need improving. The idea that it should be occurring constantly in all things is dogma, not strategy.

For the complete article, read “If it ain't broke, don't kaizen it.”

From AICPA CPA Insider, June 25, 2012, http://www.CPA2biz.com.