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Kaikaku method – how does it work?

Kaikaku method

Today’s business environment is characterized by strong global competition and fast-paced changes. That’s why production functions of manufacturing companies must have a capacity of undertaking large-scale improvement of a radial and innovative nature.
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Kaikaku definition

Kaikaku is a Japanese word meaning change or reformation. The Kaikaku method tends to entail large-scale changes involving wide ranging activities. Changes are made in, for instance, production processes, pieces of production equipment, culture in organizations, manufacturing strategies, leadership styles, information systems, and management processes. In some cases, the scope of the change was not only the production systems but also all production functions or the whole company. It often involved implementation of lean production. 

Nowadays companies must be proficient in radical innovation in production to maintain their advantages. They must be capable of creating new knowledge and constantly developing and implementing new production technologies, processes, and equipment which helps them to keep competitive edge and make “unique” goods. Kaikaku offers improvement that involves fundamental rethinking and radical design of systems and processes related to production, performance of the production system which is frequently measured in terms of cost, quality, speed, and flexibility. 

Kaikaku implementation

Kaikaku is a deliberate effort initiated by top and senior management and requires a strong direction from the management, as the implementation and the result significantly impact business. Since Kaikaku often changes the processes that involve different groups, divisions, or departments in the organizations, coordination and direction from the high-level management are needed. The Kaikaku method can be characterized as a top-down approach, but this does not necessarily mean that changes are never collaborative and participative. Sometimes the actual changes are driven by employees at lower levels of the organization. 

Kaikaku form

Kaikaku uses a definite time period with specific targets to be achieved at the end of the period. Therefore, it is typically seen as a large project or an initiative. The large project often contains smaller ones conducted at different points of time during the overall initiative. The time frames of the Kaikaku initiatives ranged from a few months to a few years. 

Kaikaku process

The Kaikaku process consists of several stages:

  1. Preparation

It is important here to ensure management commitment, identify necessary changes,  set up strategy and targets, prepare smaller projects and allocate tasks, together with educating staff on further steps.

  1. Redesign 

This phase allows us to analyse processes and make necessary adjustments as well as  test and evaluate solutions.

  1. Implementation

Finally it’s time to implement new systems and processes, provide training for employees  and monitor changes. 

Kaikaku projects

Kaikaku projects can be of four different types:

  • Locally innovative implementation – for example introducing a solution well-known to the industry, but new to the company;
  • Locally innovative methodology – for example introducing new methods, well-known to the industry, but new to the company;
  • Globally innovative implementation – for example introducing a new solution to the industry;
  • Globally innovative methodology – for example introducing a new production theory to the industry.

Some of the Kaikaku projects result in improvements in the range of 30-50% due to their radicality.

Organization structures and resources need to be prepared to support the mentioned types of Kaikaku. A process of Kaikaku can be seen as a series of unfolding smaller improvements or development projects that are undertaken to achieve overall objectives. In each project exploration and organizational learning are facilitated, so even in a smaller company it is possible to benefit from such an approach.

If you wish to learn more about other methods of optimization of production planning processes check out this article.

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