Discrete Improvement and Continuous Improvement


“The ability to add your creative ideas and changes to your own work is what makes it possible to do work that is worthy of humans.” — Taiichi Ohno

 
If there is another term as frequently misused as “Continuous Improvement”, I’m unable to think of it. Nowadays everyone claims to be doing it, yet they are all doing different things. The term has for the most part lost its meaning. This is quite unfortunate if we consider that continuous improvement, in some of its incarnations, is a key pillar of business excellence; this is the version that this page discusses.

Conversely “Discrete Improvement” is quite straightforward, it is an event, a change that follows the discipline of improvement. This will not be examined in as much detail, except as a contrast to the concept of continuous improvement.

 

The Tools Misconception

Much like business improvement in general, continuous improvement often gets associated with the tools and methods that businesses apply in their pursuit of improvement. This mistake is understandable, as the tools and methods are the most visible aspects of improvement, however, it unfortunately misses the more subtle point of why those methods are used and can result in the preoccupation with a particular toolkit or approach[1].

 

The Scale Misconception

Discrete and Continuous Fallacy

Common misconceptions of Discrete and Continuous Improvement.
Neither is defined by the scale of changes.

Small-scale improvements are often stated as a defining characteristic of continuous improvement. This is an exaggeration of the spurious correlation between small-scale change and continuous improvement. It has even given rise to the term “Continual Improvement”, a series of small discrete improvements[2]. Essentially what is wrong with the image on the right is the labels; the top is disruptive change (discrete improvement can be large or small), the bottom is continual improvement. Essentially continual improvement is about iteration, while continuous improvement is about the mindset, not something that can be shown as a time-series graph.

A more appropriate defining characteristic, as will be examined in detail below, is the mindset and approach to change. Organisations that embrace continuous improvement take the view that there are always better ways to do things and keep searching for them, continuously. With adequately supportive leaders, such an organisation will invariably see many improvements. One side-effect of this is a reduction in the need for large-scale changes, relative to organisations which treat improvement as a bi-annual event, however, this is in no way synonymous with focusing only on small-scale improvements.

Another reason why small-scale change is correlated to continuous improvement stems from the nature of disciplined change. As discussed on that page, taking the time to understand a situation can reveal opportunities for simpler, targeted changes. For many situations, solutions can be found that follow the Pareto rule; 80% of the outcome can be achieved with 20% of the effort, 64% with 4% of the effort, etc. With fewer barriers to change, organisations pursuing continuous improvement will naturally see many smaller changes taking place; again, this is a side-effect rather than defining characteristic of continuous improvement. Needless to say, this does not apply to all situations and sometimes economies of scale call for larger changes. Business leaders still need to be looking for disruptive (i.e. macroscopic) changes; these are less frequent but looking for them should be continuous.

 

Continuous Improvement: A Mindset

Continuous Improvement Mindset

Continuous Improvement as a mindset.

The elusiveness of a uniform definition for continuous improvement stems in part from its invisible nature; it is a different mindset, which extends beyond the superficial, yet more salient, aspects such as the scale of change. Continuous improvement is the mindset of avoiding complacency in everything you do as an organisation. Just because there is no obvious or economical way to improve something today, does not mean that one should just “leave it alone”.

Consider how the latter part of the phrase “Our ______ is world-class, it cannot be improved” becomes a self-fulfilling prophecy. The polar opposite of continuous improvement is the mindset of “best practices”[3], the mind-numbing idea that there is a “best” way to do something; how does one improve from “best”?

A good introduction to the continuous improvement mindset is provided by one of its originators, Taiichi Ohno[4]:

There is something called standard work, but standards should be changing constantly. Instead if you think of the standard as the best you can do, it’s all over. The standard is only a baseline for [further improvement]… Standards are set arbitrarily by humans, so how can they not change?

 
When creating standard work, it will be difficult to establish a standard if you are trying to achieve “the best way.” This is a big mistake… the motivation for [improvement] will be gone…

 
But in the beginning, you must perform the standard work, and as you do, you should find things you don’t like, and you will think of one [improvement] idea after another. Then you should implement these ideas right away and make this the new standard.

 
Years ago, I made them hang the standard work documents on the shop floor. After a year I said to a team leader, “The color of the paper has changed, which means you have been doing it the same way, so you have been a salary thief for the last year.” I said, “What do you come to work to do each day? If you are observing every day you ought to be finding things you don’t like and rewriting the standard immediately. Even if the document hanging here is from last month, this is wrong.” At Toyota in the beginning we had the team leaders write down the dates on the standard work sheets when they hung them. This gave me a good reason to scold the team leaders, saying, “Have you been goofing off all month?”

 
If it takes one or two months to create these documents, this is nonsense. You should not create these away from the job. See what is happening [at the work site] and write it down.[2013, pp.142-3]

 

Eastern and Western Approaches to Change

As we saw above, Taiichi Ohno’s “philosophy of change” was about having the mindset to reject complacency and always look for ways to do things better. This ongoing “search” for improvement is not a trait unique to Ohno, and perhaps is related to the Japanese tradition of craftsmen honing their skills, as seen in the documentary Jiro Dreams of Sushi. How broadly this has affected the philosophy of business change in Japan and the region, I’m not in a position to say, so for this section I’ll just contrast Ohno’s ideas with traditional western approaches.

But what is the corresponding western “philosophy of change”? Consider how three words from Kurt Lewin’s 1947 paper on field theory and social group equilibria[5] have captured the imaginations of western organisations; “a planned social change may be thought of as composed of unfreezing, change of level, and freezing on the new level”[p.36]. The lasting appeal of the three words is in part due to how they reflect an idealised model of discrete change, one with a clearly defined beginning and end. Whether or not the words “Unfreeze, Change and Freeze” are explicitly used, they provide a good description of the western philosophy of change; one only needs to consider some other common terms that permeate change efforts. A “Current State” that one needs to unfreeze, a “Gap” that change needs to traverse to arrive at a “Future State” where one aims to freeze things at.

Talk of freezing future states would tend to assume, explicitly or implicitly, that:

  • How things will work after the change can be accurately predicted.
  • A “best” solution can be found (see above).
  • No further change will be desirable for a considerable period.

How often are these true? Furthermore, the notion of change having a definitive “end”, as appealing as that might be from a change accounting perspective, is rather dubious. Change has short and long-term effects; those that occur through systemic feedback or other indirect diffusion may take years to unfold. What is the total positive and negative impact of a change? (Hint: when would you really know?)

Ohno’s philosophy was diametrically opposed to the notion of freezing, rejecting the faith in one-shot change, instead seeing change as transient, with any “stasis” persisting only in the very short-term. In other words, the continuous improvement mindset implies that change should be made with the expectation of changing things again soon after.

In sum, the mindset of continuous improvement may be inherently unsettling to western audiences who are used to seeing change as a discrete, finite “event”. If so, that would provide explanations for the slow uptake of continuous improvement (the mindset, not the label) and why the ideas are sometimes warped to conform with orthodox business thinking. But is it really something uniquely difficult for western managers to get comfortable with? I often read that Ohno’s approach to organising was rather unusual in Japan, and he himself wrote: “I think another [Japanese] company would never have let me try this”[2013, p.72]. So while some cultural differences may be a factor, they should not become a convenient excuse — there are other forces at play. That some organisations in traditionally “western” countries have succeeded with continuous improvement is reassuring, though we must always look deeper, past the label, when examining these cases.

 

Who Should Be Involved?

If we pose to business leaders a drive-by-research survey question “Is your organisation pursuing a strategy of continuous improvement?”, a great number will answer “yes”, I would predict close to 100% for larger companies. But if we actually interviewed those same leaders, we are likely to find that they themselves are not involved at all, and that the organisation has a dedicated manager or team “responsible for” continuous improvement. While having some specialists around is helpful, their presence alone cannot transform the thinking of others in the business; if business leaders do not actively “lead” continuous improvement, it is reduced to a mere label.

Continuous improvement should occur in top-down and bottom-up modes simultaneously. For those situations where no simple solution is adequate, business leaders still need to work on larger change initiatives, while a myriad of localised problems can be addressed by the front line. Communication is an essential ingredient to finding improvement opportunities, as illustrated by Russell Ackoff’s account of his work with a plant manager[6]:

He said, “If I had money, I would automate the hell out of this plant, get rid of a large part of the work force, and I could make it pay.” I said, “How do you know that?” He said, “What do you mean, how do I know it?” I said, “Well, how do you know that that’s so.” He said, “Well, I believe it.” I said, “Well, that’s different. That’s not knowing.”

 
So I suggested that we do a simulation of the plant under the assumption that he had all the money he wanted and he could automate the hell out of it. He took the top management of the plant, they spent about 6 months designing the most advanced aluminium production facility in the world. It fortunately could be simulated on a large computer — we did — and it still lost money. And the reason was clear. It was labor and management relations. Labor was so unproductive, relative to the price, that even with complete automation, going from 6,200 to 1,500 didn’t pay. And we said, “You’ve gotta do something about labor.”

 
Well, it’s a long story, but what he ultimately did was empower the work force. He said, “You people know more about the work shop than we do, so you tell us what to do down there.” And I can give you all sorts of examples. There are two workers who made a change at the end of a rolling mill that saved the company two-and-a-quarter million dollars after taxes. They did it in 15 minutes…

 
The day after they did this, I was visiting, and I went down to see them. And I said, “You know, it’s marvelous what you did.” And boy, they puffed up, they were so proud. These were men in their 50’s. They had been working in the plant for 25 years. And then I said, “How long have you known about this?” And they both looked down. They didn’t answer. “Come on. Tell me the truth. I won’t tell anybody.” And one of them looked up, and he mumbled, “Fifteen years.” I said, “How come you never said anything about it before?” And I’ll never forget his answer, because he taught me something. He said, “Those sons of bitches never asked me before.” And the answer to the question of how we increase the productivity of labor is to start asking ‘em. You get incredible increases.[1992, pp.74-6]

Ackoff’s example coincidentally illustrates the problem of undisciplined change. 6 months spent trying to justify a solution? Until one can be reasonably sure that opportunities for simple changes have been exhausted, the benefits of large-scale automation cannot be realistically estimated. Furthermore, changes aimed at reducing the number of employees send the message that the business is in decline; improvement ideas are unlikely to be forthcoming when people are scared of losing their jobs as a result. If the need to do certain activities is eliminated, this should be seen as an opportunity to expand the business in a new direction or work on other initiatives without incurring additional costs.

Understandably, another common misconception is that continuous improvement is a “grassroots” activity, that if front-line employees are sufficiently empowered, they alone will solve the organisation’s problems. While the front-line should be actively involved in looking for things that need to be improved, these may often be things they cannot do anything about. Investment in new equipment, changes in other areas of the organisation and negotiation with suppliers are just some of the things that business leaders need to step-in and help with. Sometimes the best approach may be a complete re-design. Merely using ‘empowerment’ as rhetoric to push accountability downwards will likely result in disillusionment and not improvement.

 

Culture: The Key Ingredient or a Proxy Indicator?

Many talk about a “Continuous Improvement Culture” and earlier I mentioned the need for supportive leadership. Addressing the people-side of improvement is essential[7] but is it the complete story? Like business excellence, the prerequisites for continuous improvement are broader than just a change of culture, as that can be eroded away quickly.

For many years “Culture” has been a staple in discussions of business, both practical and academic. There are however many different conceptions of culture, and these include the view “that organizations are themselves culture-producing phenomena… social instruments that produce goods and services, and, as a by-product, they also produce distinctive cultural artifacts such as rituals, legends, and ceremonies”[8]. This view that organisations produce culture implies that you cannot change culture directly but rather need to understand its antecedents and make changes to those.

Performance management practices are an often discussed example of tangible activities that are not part of organisational culture but strongly influence it. Someone who needs to “meet the numbers” is not going to be easily engaged in improvement activities. On the surface it might look like they are uncooperative and resistant (“resistance to change” is another misnomer that I will not elaborate on here), and that the “culture” of the place is at fault, but no amount of “warm and fuzzies” will last very long if the underlying issue is not addressed.

That said, there are definitely many “softer” aspects of continuous improvement that relate to how individuals think, such as their attitudes to problems (opportunity for improvement vs. casting blame). While the existing members of an organisations can change their thinking at a given point in time, there is no guarantee that future members will have a similar mindset; if this is considered important, then it may warrant formalisation in the selection or induction processes to make such aspects more tangible.

 

Quick Exercise

Consider some problems that you worked on in your organisation.

  1. Were you looking for the “perfect” permanent solution, or ways to do things better today with the possibility of changing again tomorrow?
  2. When you see improvement, who is involved? Do senior leaders work with the front line to identify and address opportunities for improvement?

(If you are unsure about the barriers to continuous improvement in your business then contact us)

 
 
Next: TBC

 
 

Optional Footnotes

1. ^ Mark Graban’s video about bad 5S is a great commentary on tool-fetishism:

http://www.leanblog.org/2012/04/a-video-showing-office-5s-gone-wrong/

It would be more hilarious if not for the realisation that Mark has witnessed enough of such occurrences to feel the need to make such a video. Rather than looking for situations to use a given tool, we need to be looking for tools to use in a given situation; this of course means we need to be familiar with many tools in the first place and their suitability in various contexts.

The skit illustrates another important point; those who ask questions are often looking after the interests of the organisation they work in. Unfortunately some change management (and I am using the term very loosely here) devolves into a “you’re either with us or against us” witch hunt; sure that might make it easier to implement changes quickly but…

2. ^ Before you continue, let me remind you of the “Optional” prefix for the footnotes section. Sometimes these footnotes help to provide some extra detail but in this case it is more likely to confuse than help. You have been warned.

Improvement, for the most part, is a series of planned, discrete changes, and it is generally more accurate to call a series of granular improvements “Continual” rather than “Continuous”. However, while a change is discrete, its effects generally are not. While some effects may be immediate, others which propagate through systemic feedback are gradual and extend far beyond the “Discrete” change event. In that regard, the notion of discrete change (as per the “western philosophy of change” discussed on this page) starts to look rather dubious.

In the case of some industrial processes, the effects of a change can be truly “Continuous”. What kind of industrial process would this apply to? Well, a “Continuous Production” process, such as one dealing with liquids or gasses; a single improvement to such a process would result in a gradual (“continuous”) change to a new equilibrium.

In the majority of cases, the frequency of improvement has an upper limit, determined by the rate of feedback. For example, changing part of a process with a long cycle time means that the effects of the change cannot be assessed until much later. Generally speaking, making changes more rapidly than their effects can be examined would no longer be considered improvement; one may “feel” that a change is so sure to work that observing its effects is unnecessary but that is not the same as “knowing”.

Confused? Well I did warn you… The other footnotes will be better, maybe.

3. ^ Not only is “Best Practice” a thought-terminating cliché that stops continuous improvement dead in its tracks (how could one improve any further?), it is a terrible term due to the various assumptions it carries:

  • A “best” way of doing something is known (how would one tell?)
  • The labelled practice is the “best” (how would one prove this?)
  • There is no better way (who would check this?)
  • The same practice is “best” for everyone (…)

I can only imagine that the phrase has become so popular because people like to force their views on others without question. Consider the alternative “Good Practice”; it leaves open the possibility of something being “better” and by doing so invites discussion and critical thinking. We might therefore conclude that semantically “good” or “better” are superior to “best”.

4. ^ Taiichi Ohno’s book provides many insights into continuous improvement, the practice of improvement in general, the origins of the ideas behind Lean and many other related concepts:

Ohno, T. 2013, Taiichi Ohno’s Workplace Management, Special 100th Birthday edn, McGraw Hill.

I note that this English translation has retained some of the original Japanese words such as Kaizen and Gemba (“Improvement” and “The place where the work is done” respectively). In my view, many of Ohno’s ideas extend beyond what is often labelled “Lean” nowadays, and can be of great value to those not practicing “Lean” per se, so I have mixed feelings about any obfuscation of his writings with jargon that only a cabal of enlightened Sensei are privy to; Ohno himself opposed the labeling and packaging up of his ideas [any first-hand source for this?], yet this seems to be exactly what has happened.

5. ^ Lewin’s original paper is still a good read despite its age showing in places. What amazes me, and this isn’t the only case, is how three words, arguably from a peripheral discussion, are what is remembered from an article over thirty pages long. Actually, force field analysis is still used today, though I believe its origins precede this paper.

Lewin, K. 1947, ‘Frontiers in Group Dynamics: Concept, Method and Reality in Social Science; Social Equilibria and Social Change’, Human Relations, vol. 1, no. 1, pp. 5-41.

6. ^ I found this in a transcript of a discussion between Ackoff and Deming in 1992. There are plenty of other insights from Dr. Ackoff in the transcript:

http://ackoffcenter.blogs.com/ackoff_center_weblog/2011/04/a-converstaion-between-russell-ackoff-and-edward-deming.html

7. ^ This post by Mark Graban emphasises the leadership aspect of culture, something often seen in discussions of improvement.

http://www.leanblog.org/2014/08/to-create-a-culture-of-continuous-improvement-put-away-the-gavel/

It is essential to focus on leadership in any improvement effort but it is also important to dig deeper. Like culture, many leadership behaviours are influenced by other aspects of an organisation — if these are not considered then it should not be a surprise when a new manager reverts things to how they were before the “cultural change” was introduced.

8. ^ This comes from a paper by Linda Smircich that explores the many perspectives on organisational culture. It can help to dispel any notion of culture being a singular or easily defined concept.

Smircich, L. 1983, ‘Concepts of culture and organizational analysis’, Administrative science quarterly, pp. 339-58.

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Marcin Kreglicki

Business Excellence & Improvement Consultant at Effective Perspectives Consulting
Marcin is a business improvement specialist with a passion for helping businesses be more effective. He advocates the application of evidence-based approaches to change and giving leaders an understanding of business excellence concepts relevant to their company. In support of his professional work, he is currently carrying out research on the barriers to holistic thinking in business decision-making.

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About Marcin Kreglicki

Marcin is a business improvement specialist with a passion for helping businesses be more effective. He advocates the application of evidence-based approaches to change and giving leaders an understanding of business excellence concepts relevant to their company. In support of his professional work, he is currently carrying out research on the barriers to holistic thinking in business decision-making.

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