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Kaizen as a Guiding Principle for Automation

Shainil Shah

Head of Digital , APAC


We live in an age of Artificial Intelligence and automation -- where organizations across the world strongly realize that they must be in a mode of continuous digital transformation to keep up with the challenging times, fierce competition and to deliver better, more compelling experiences to the customer/end user.

The recent challenges related to economic growth across the financial industry mandates that the organizations prioritize their critical programs including ’Must Have’ programs. This, in turn, puts tremendous pressure on organizations to improve their operational efficiencies. One of the typical Digital Transformation go-to strategies is through Automation in the form of initiatives of different scale across the organization.

Over the course of their exploration, these organizations identify a lot of automation opportunities. However, due to the market situation, budgeting challenges or even a competing strategic focus, these programs end up not receiving the necessary attention and budget. As a result, organizations can end up losing a substantial opportunity of benefits from such programs. One alternative to mitigate this is through a concept that is very popular in the manufacturing industry -- KAIZEN.

KAIZEN is a Japanese concept that was widely popularized across the globe post-WW II and became embedded into Lean Manufacturing This methodology promotes that improvements are done continuously, as an ongoing activity, to achieve significant improvements over the course of time. Adopting KAIZEN as a guiding philosophy during regular Digital Transformations delivers a continuous uplift of experience for internal or external users. This concept has a very far-reaching positive impact if incorporated as part of the ideology behind automation programs. This is specifically true for organizations that cannot execute automation as a primary Digital Transformation Strategy, especially useful for achieving operational efficiencies.


Guiding Principles of KAIZEN 

Maintaining KAIZEN and its guiding principles, the below can be used as the blueprint of the program:

  1. The vision or the end goal must be clearly defined. Frequently, programs can lose track of the end goal. This is especially true in automation cases where the focus shifts to automation as an activity rather than the outcome expected to be achieved by the automation. Hence, the program, sub-program or micro-program defined as part of the strategy should always be a step forward in the direction of achieving the end goals of the digital program(s). 
  2. Definition of activity plays a very critical role in such a program. This helps to control production of tangible outcomes. A good definition approach is where the activity is treated as an independent unit of the improvement program that pushes its overall efficiency in a positive direction.  
  3. Qualification of activity or activity selection. This is as critical as the execution of the activity improvement. The qualification criteria for whether an activity is a good candidate for improvement should align with the objectives of the organization. The criteria should be measurable from the: 
    • Perspective of the impact to the customer
    • Impact to the organization  
    • The revenue impact
    • Customer satisfaction
    • The cost-benefit or ROI of the execution 
  4. KAIZEN as a culture. The program can only be of genuine benefit if the improvement is treated as an intrinsic part of the responsibilities of everyone involved, and not as a separate activity. Everyone involved in the process must contribute to the Definition-Qualification-Execution-Change Management cycle of the improvements to maximize the impact expected from the program.


Specific Advantages of KAIZEN 

  •     Lower Investment -- As a result of continuous, steady automation, this approach helps organizations to keep the momentum going with a lower investment or budget requirement as compared to a large-scale one-off program. KAIZEN provides an opportunity to move the investment as part of Operational expenditures rather than Capital Expenditures, especially in times of strict budgetary controls. For instance, one of the organizations over a period of six months through micro-improvements in the process, brought down the internal time to close reconciliation from one week to near-real-time, by enabling continuous, case by case automation of different types of reconciliation scenarios. This gradually reduces the time of activity to near-real-time by enabling users to focus on fewer scenarios of reconciliation with each release, up until only handling of exceptions towards the end. All this was achieved by executing process transformation and automation as part of the monthly improvement cycle for the reconciliation process. 
  •     Simpler Change Management -- Since KAIZEN relies on a cultural focus where everyone is part of the Transformation, the change management is very simple. This is unlike other Digital Transformation programs where change management needs dedicated attention and planned effort for adaptation of the new process or technology. For example, for one of an organization’s Customer Onboarding processes, the form submission time was reduced from over an hour to under 10 minutes, by enabling assisted data entry through automation. With every release the average time to submit a form was reduced, while allowing the agents to familiarize themselves with the change. This was achieved by keeping the Base process and data requirements the same but enabling background data retrieval to assist with data entry for each section of the form. This helped minimize change management issues by keeping the familiarity with the process intact, but gradually increasing the scope of assisted data entry section by section with each release. 


Cautions and Challenges 

Like any ideological approach, the KAIZEN methodology is not without its cautions. There is a risk of losing strategic focus if the execution is not under continuous or periodic review. The program may end up becoming an endless activity, whereby the transformation is applied in layers one over another, just to keep the improvement ongoing without any substantial benefit to each transformation. It is imperative that the program always undergoes necessary checks of its adherence to Vision-Qualification-Process Definition principles as well as following the Optimal Process Design approach during execution.

The Author

Rachel Anderson, Digital Lead at Synechron UK
Shainil Shah

Head of Digital at Synechron APAC

Shainil has 13+ years of delivery experience and is responsible for delivering value driven implementation programs for clients.  His key engagements include customer operation setup and process design, re-engineering and automation consulting and business solution implementations for clients across Japan, Singapore, and Hong Kong.

To learn more about how Synechron’s Digital capabilities can enhance and progress your unique digital transformation journey, reach out to Shainil Shah.

Synechron’s Global Digital Practice – We pride ourselves on creating user experiences that people love by exceeding expectations. Our core capabilities include, but are not limited to:   

  •     Digital Strategy Assessments 
  •     Experience Design 
  •     Application Development 
  •     Product Discovery and Management 
  •     Product Validation and MVP Creation  

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