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Business improvement in distribution | What is the Kaizen approach?

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Business improvement in distribution | What is the Kaizen approach?

Excuse us, but we may start to get a little philosophical in this blog as we draw towards the end of 2016.  We often speak about business improvement or digital transformation and sometimes it may seem to be overwhelming to bring about business change.  However, if you look at your business like a jigsaw puzzle (Christmas game anyone?) and define the separate elements you can take a “Kaizen” approach.

Kaizen (Japanese for “improvement”) is a philosophy that looks at incremental gains to bring about improvement in performance and process – whether it is personal, in business or in the sports world.

A recent example of Kaizen is the British Cycling scenario adopted by their General Manager, Sir Dave Brailsford back in 2010.  His interpretation was the concept of the “aggregation of marginal gains.”  The result has been that in the last two Olympics, Team GB has captured 16 gold medals and British riders have won the Tour De France three times in the last four years; ahead of target.

This incremental philosophy is also shared by Jeff Olsen in his “Slight Edge” article, here’s his success curve which looks at the use of multiple, simple steps.

The Slight Edge

What can business (and more specifically, distributors) learn from Brailsford’s approach?

Achieving business improvement in distribution

If distribution companies take a look at each area of their business, including people, process, supply chain, function and systems – and seek best practice in each area; even the small changes will add up over time and result in a large gap when comparing to the start point.

So our advice would be to spend some time at the end of this year in order to look at business change in 2017 and capture your start point and then define the areas of business you can tackle with your 1% strategy.

In our distribution whitepaper “Top 10 steps to achieving success in modern distribution – getting the basics right” – we go into further detail about which key areas you need to address and this can be your guide for your marginal improvement plan – if a 100% replacement strategy isn’t the right one for you.  Prioritise these business areas:

  • The ability to profile customers and buying trends
  • Inventory optimisation for improved cashflow
  • Optimising fulfilment rates
  • Recognising and reducing errors
  • Achieving on-time delivery
  • Increase average order sizes
  • Lowering or controlling costs
  • Facilitating internal and external collaboration across the supply chain

By adopting a 1% approach, you can also manage your risk and test new things out – because there isn’t a big bang you will not see a big leap and sometimes that can be appropriate.

For more information on business improvement within distribution, download the whitepaper, review our distribution articles and speak to Prodware about the best approach for you to achieve success in 2017.

Download a distribution whitepaper

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