Skip to main content

Advertisement

SpringerLink
Log in

Revisiting the existing notion of continuous improvement (Kaizen): literature review and field research of Toyota from a perspective of innovation

  • Article
  • Published:
Evolutionary and Institutional Economics Review Aims and scope Submit manuscript

Abstract

Continuous improvement (Kaizen) has been identified as a crucial factor for strengthening firms’ competitiveness in the automotive industry as well as others, and many scholars view it as detailed below. In the existing literature, from a perspective of innovation, Kaizen has often been conceived of as an accumulation of similarly small, mutually independent, incremental process innovations that are conducted by workers, work-teams, and their leaders. However, few empirical case studies examine the relevance of this conventional notion of Kaizen. Do Kaizen activities contribute only to similarly small, incremental process innovations? Does Kaizen only consist of various mutually independent innovations? Is Kaizen always achieved by workers and work-teams rather than by engineers? This paper attempts to observe those continuous improvements conducted in a certain factory for a certain period. Through longitudinal observations, this paper shows via seven case studies that (1) Kaizen consists of a series of innovations with various scales and that these scales could also be estimated by the “scope of coordination” in addition to existing scale indicators, such as the investment amount, and outcomes, such as the cost reduction effect. Additionally, (2) Kaizen sometimes induces small changes in product design and affects organizational activities of production design as a small-scale product innovation. Furthermore, (3) Kaizen activities sometimes influence other Kaizen activities. With regard to these characteristics of Kaizen, this paper implies that (4) Kaizen management needs organizational design. For example, in Toyota’s case, not only work-teams but also product/process design engineers contribute to Kaizen, and shop-floor engineers play a vital role in coordinating between shop-floors and engineering departments on the basis of the “staff-in-line structure” of organizations.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3
Fig. 4
Fig. 5
Fig. 6
Fig. 7
Fig. 8
Fig. 9
Fig. 10
Fig. 11
Fig. 12
Fig. 13
Fig. 14

Similar content being viewed by others

Notes

  1. This article uses the word “Kaizen” as an uncountable noun.

  2. Boer and Gertsen (2003) define continuous innovation as process and product innovation, but they also think of continuous innovations as relatively small and numerous changes.

  3. Koujô-Gijyutsu-In in Japanese.

  4. Evolutionary economics considers that changes of organizational routines occur by chance like distribution of a random variable (Nelson and Winter 1982), thus making micro-firm-level analysis difficult.

  5. Their discussion considers it important to divide one routine into two aspects (ostensive and performative). The ostensive aspect describes standard rules or procedures that govern behavior in organizations. The performative aspect indicates the specific and inherently improvisational actions taken by people in organizations. This study does not use this idea.

  6. Womack et al. (1990) also studies Takaoka.

  7. Following D'Adderio (2011), an organizational routine change was deemed to have occurred when an explicit operational procedure was altered.

  8. For example, operational improvement, process/production engineering, product/design engineering, etc. could be included in Kaizen projects as innovations.

  9. This is calculated as 12 times 0.5 = 6.

  10. ¥100 yen was approximately US$1 in 2015.

  11. It is a kind of Japanese English used in factories. Takt time means the time necessary to assemble one unit.

  12. It is a hinged cover over the engine.

  13. It is also called the “side member”.

  14. Of course, it is a required consideration that weighted scope of coordination is one kind of investment.

  15. From these cases, we can say that Kaizen consists of a variable scale of innovations and we can measure this by the scope of coordination in addition to the investment amount and cost reduction effects.

  16. Of course, it is doubtful that Toyota almost always determines the exact extent of coordination necessary for Kaizen.

  17. The term “line” here means both organizational positions: line and production line.

  18. Mintzberg (1980) calls an organization resembling staff-in-line “the Divisionalized Form organization” (p. 335). However, staff-in-line is nearer the plant floor than in Mintzberg’s model and is unique in serving two roles.

  19. Interview conducted on February 13, 2014.

  20. The scale of innovations (and variability thereof) is also a function of the scope of innovations because innovative activities in this context are organizational in nature and require coordination.

References

  • Abernathy WJ (1978) The productivity dilemma: roadblock to innovation in the automobile industry. Johns Hopkins University Press, Baltimore

    Google Scholar 

  • Abernathy WJ, Utterback JM (1978) Patterns of industrial innovation. Technol Rev 64(7):228–254

    Google Scholar 

  • Adler PS, Goldoftas B, Levine DI (1999) Flexibility versus efficiency? A case study of model changeovers in the Toyota production system. Organ Sci 10(1):43–68

    Article  Google Scholar 

  • Anand G, Ward PT, Tatikonda MV, Schilling DA (2009) Dynamic capabilities through continuous improvement infrastructure. J Oper Manag 27(6):444–461

    Article  Google Scholar 

  • Barnard CI (1938) The functions of the executive. Harvard University Press, Boston

    Google Scholar 

  • Barratt M, Choi TY, Li M (2011) Qualitative case studies in operations management: trends research outcomes and future research implications. J Oper Manag 29(4):329–342

    Article  Google Scholar 

  • Becker MC (2004) Organizational routines: a review of the literature. Ind Corp Change 13(4):643–678

    Article  Google Scholar 

  • Becker MC (2005) The concept of routines: some clarifications. Camb J Econ 29(2):249–262

    Article  Google Scholar 

  • Bessant J, Caffyn S (1997) High-involvement innovation through continuous improvement. Int J Technol Manag 14(1):7–28

    Article  Google Scholar 

  • Bessant J, Caffyn S, Gallagher M (2001) An evolutionary model of continuous improvement behavior. Technovation 21(2):67–77

    Article  Google Scholar 

  • Bhuiyan N, Baghel A (2005) An overview of continuous improvement: from the past to the present. Manag Decis 43(5):761–771

    Article  Google Scholar 

  • Boer H, Gertsen F (2003) From continuous improvement to continuous innovation: a (retro)(per)spective. Int J Technol Manag 26(8):805–827

    Article  Google Scholar 

  • Choi TY (1995) Conceptualizing continuous improvement: implications for organizational change. Omega 23(6):607–624

    Article  Google Scholar 

  • Clark KB, Fujimoto T (1991) Product development performance: strategy organization and management in the world auto industry. Harvard Business Press, Boston

    Google Scholar 

  • D’Adderio L (2008) The performativity of routines: theorising the influence of artefacts and distributed agencies on routines dynamics. Res Policy 37(5):769–789

    Article  Google Scholar 

  • D’Adderio L (2011) Artifacts at the centre of routines: performing the material turn in routines theory. J Inst Econ 7(2):123–197

    Google Scholar 

  • Dyer JH, Singh H (1998) The relational view: cooperative strategy and sources of interorganizational competitive advantage. Acad Manag Rev 23(4):660–679

    Google Scholar 

  • Eisenhardt KM (1989) Building theories from case study research. Acad Manag Rev 14(4):532–550

    Google Scholar 

  • Ettlie JE, Reza EM (1992) Organizational integration and process innovation. Acad Manag J 35(4):795–827

    Article  Google Scholar 

  • Feldman MS (2000) Organizational routines as a source of continuous change. Organ Sci 11(6):611–629

    Article  Google Scholar 

  • Feldman MS, Pentland BT (2003) Reconceptualizing organizational routines as a source of flexibility and change. Admin Sci Quart 48(1):94–118

    Article  Google Scholar 

  • Fujimoto T (1999) The evolution of a manufacturing system at Toyota. Oxford University Press, New York

    Google Scholar 

  • Fujimoto T (2007) Competing to be really good: The behind-the-scenes drama of capability-building competition in the automobile industry. International House of Japan, Tokyo

    Google Scholar 

  • Fujimoto T (2014) The long tail of the auto industry life cycle. J Prod Innov Manag 31(1):8–16

    Article  Google Scholar 

  • Gulick L, Urwick L (eds) (1937) Papers on the science of administration. Institute of Public Administration, New York

    Google Scholar 

  • Hackman JR, Wageman R (1995) Total quality management: empirical conceptual and practical issues. Admin Sci Quart 40(2):309–342

    Article  Google Scholar 

  • Hayes RH, Clark KB (1985) Explaining observed productivity differentials between plants: implications for operations research. Interfaces 15(6):3–14

    Article  Google Scholar 

  • Hayes RH, Wheelwright SC (1979) Link manufacturing process and product life cycles Harvard. Bus Rev 57(1):133–140

    Google Scholar 

  • Helfat CE, Winter SG (2011) Untangling dynamic and operational capabilities: strategy for the (N) ever-changing world. Strateg Manag J 32(11):1243–1250

    Article  Google Scholar 

  • Imai M (1986) Kaizen: the key to Japan’s competitive success. Random House Business Division, New York

    Google Scholar 

  • Iwao S (2015) Organizational routine and coordinated imitation. Ann Bus Admin Sci 14(5):279–291

    Google Scholar 

  • Koike K (1998) NUMMI and its prototype plant in Japan: a comparative study of human resource development at the workshop level. J Jpn Int Econ 12(1):49–74

    Article  Google Scholar 

  • Koike K, Tyuma H, Ōta S (2001) Monozukuri no ginou (the skills for manufacturing). Toyokeizai, Tokyo (in Japanese)

    Google Scholar 

  • Lawrence PR, Lorsch JW (1967) Differentiation and integration in complex organizations. Admin Sci Quart 12(1):1–47

    Article  Google Scholar 

  • Lindberg P, Berger A (1997) Continuous improvement: design organization and management. Int J Technol Manag 14(1):86–101

    Article  Google Scholar 

  • March JG, Simon HA (1958) Organizations. Blackwell, Cambridge

    Google Scholar 

  • Mintzberg H (1980) Structure in 5′s: a synthesis of the research on organization design. Manag Sci 26(3):322–341

    Article  Google Scholar 

  • Monden Y (1983) Toyota production system: practical approach to production management. Engineering & Management Press (Productivity Press), New York

    Google Scholar 

  • Myers S, Marquis DG (1969) Successful industrial innovations (NSF 69-17). National Science Foundation, Washington

    Google Scholar 

  • Nelson RR, Winter SG (1982) An evolutionary theory of economic change. The Belknap Press of Harvard University Press, Cambridge

    Google Scholar 

  • Ōno T (1988) Toyota production system: beyond large-scale production. Productivity Press, New York

    Google Scholar 

  • Pentland BT, Feldman MS (2008) Designing routines: on the folly of designing artifacts while hoping for patterns of action. Inform Organ 18(4):235–250

    Article  Google Scholar 

  • Plowman DA, Baker LT, Beck TE, Kulkarni M, Solansky ST, Travis DV (2007) Radical change accidentally: the emergence and amplification of small change. Acad Manag J 50(3):515–543

    Article  Google Scholar 

  • Schumpeter J (1934) The theory of economic development: an inquiry into profits capital credit interest and the business cycle. Harvard University Press, Cambridge

    Google Scholar 

  • Shingo S (1981) A study of the Toyota production system from an industrial engineering viewpoint. Japan Management Association, Tokyo

    Google Scholar 

  • Shingo S (1988) Non-stock production: the Shingo system for continuous improvement. Productivity Press, Cambridge

    Google Scholar 

  • Simon HA (1947) 1997) Administrative behavior: a study of decision-making processes in administrative organizations, 4th edn. The Free Press, New York

    Google Scholar 

  • Simon HA (1969) The sciences of the artificial. MIT Press, Cambridge

    Google Scholar 

  • Thompson VA (1965) Bureaucracy and innovation. Admin Sci Quart 10(1):1–20

    Article  Google Scholar 

  • Weick KE, Quinn RE (1999) Organizational change and development. Ann Rev Psychol 50(1):361–386

    Article  Google Scholar 

  • Winter SG (2003) Understanding dynamic capabilities. Strateg Manag J 24(10):991–995

    Article  Google Scholar 

  • Womack JP, Jones T, Roos D (1990) The machine that changed the world. Rawson Associates, New York

    Google Scholar 

  • Yin Robert K (1994) Case study research: design and methods, 2nd edn. Sage, New York

    Google Scholar 

  • Zollo M, Winter SG (2002) Deliberate learning and the evolution of dynamic capabilities. Organ Sci 13(3):339–351

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. University of Tokyo, Tokyo, Japan

    Shumpei Iwao

Authors
  1. Shumpei Iwao
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Shumpei Iwao.

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Iwao, S. Revisiting the existing notion of continuous improvement (Kaizen): literature review and field research of Toyota from a perspective of innovation. Evolut Inst Econ Rev 14, 29–59 (2017). https://doi.org/10.1007/s40844-017-0067-4

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s40844-017-0067-4

Keywords

JEL Classification

Search

Navigation