Ethiopia – Doing it the Japanese way

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The Japanese workplace philosophy of Kaizen is sweeping all before it in factories and workshops in Ethiopia. The philosophy, developed by Japan after World War II to make the most of meagre resources through efficiency, seems to be a perfect fit for Ethiopia’s industrial needs. James Jeffrey made the rounds of businesses in Addis Ababa to find out how the idea works and with what results.

Inside a dimly lit shed, a projector displayed a PowerPoint presentation onto a hastily rigged sheet of wood. Although the text was in Amharic, the main language of Ethiopia, the ideas behind the bullet points are summed up by one Japanese word: Kaizen. A small group of Ethiopian furniture makers sat and listened intently to the instructor from the Ethiopian Kaizen Institute (EKI), while in the back row a woman scribbled into a notepad.

Kaizen is a Japanese management philosophy that allows companies to continuously improve their productivity and product quality with available resources and without depending on new investment – and it is taking root in Ethiopian business culture.

The Addis Ababa-based EKI was established through a partnership between the Ethiopian government and the Japan International Cooperation Agency (JICA), a Japanese governmental agency focused on development through technical cooperation.

JICA has already introduced Kaizen to other African countries although its Japanese staff think Ethiopia can become a Kaizen hub due to its business situation being such a good fit for Kaizen ideas and methodologies. Ethiopian end users seem to be reacting positively to this Japanese business ethic that can trace its lineage back to the birth of Zen Buddhism.

“The workers are involved and can see the changes,” said Dawit Birasa, manager of plans and programmes at Peacock Shoe Factory, an Ethiopian company based in an Addis Ababa industrial zone and which last year embraced Kaizen. “It’s understandable and not complicated, which is a big advantage.”

Between 15th January 2013 and 22nd May 2013, a team of Kaizen consultants from EKI visited the factory 17 times to instruct workers and management on Kaizen and how it can be used to identify bottlenecks in manufacturing processes, develop action plans, provide solutions and evaluate results to instigate further improvements. By the end of May, production of quality men’s and ladies shoes had increased from 500 pairs every eight hours to 800 pairs, many of which are exported across much of Europe.

JICA’s Kaizen programme started in November 2011 and will run until October 2014. In addition to production improvements, reductions to costs and elimination of waste have amounted to savings totalling tens of thousands of dollars for companies involved in JICA’s programme.

Less tangible benefits include attitudes changed for the better, more mutually beneficial relationships between workers and managers, and improved team work and motivation levels starting at the lowest level of workers and continuing upward through a company’s hierarchies. Kaizen emphasises a bottom-up approach.

By the end of its programme, JICA aims to have trained 65 EKI consultants working with 65 large and medium enterprises, and 190 Kaizen train-the-trainers working with 190 micro and small enterprises.

Even if those figures are not met, the establishment of the EKI means that numbers trained by the institute in the future will far exceed JICA’s contribution. Those at JICA wouldn’t have it any other way. “By starting their own training initiatives there will be many more beneficiaries,” said Yuko Ikeda, JICA’s project formulation advisor for private sector development. JICA specialises in capacity building and enabling organisations achieve self-sufficiency – hence JICA programmes always have an end date.

The PowerPoint presentation to the workers at Mesker Metal & Wood PLC was only the third visit to the company by an EKI team. The ramshackle layout inside the compound indicated there was much potential for the sort of business streamlining promulgated by Kaizen. Before the presentation started, the two workers I spoke to didn’t yet seem to understand much about Kaizen, although one of them said he hoped to see workspace improvements.

“The main problem is in the workshop where materials are not accessible and it’s hard to get the right measurements,” said Selamu Bereka, clad in dusty blue overalls. “When we finish, the [cupboards] are not as good as they could be.”

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Philosophy of business

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The word Kaizen comprises two Japanese words: kai, which means “change”, and zen, which means “better”. Despite being able to trace its lineage back to the first Buddhist monks who wanted to simplify life, the connection between Kaizen and business began in earnest after World War II, said Tsuyoshi Kikuchi, EKI’s chief advisor on Kaizen in Ethiopia, who is contracted by JICA and has worked on various development projects in Africa spanning a 30-year period. This fusion of philosophical musings and business ambition was a result of the recovering Japanese economy and its companies having to make do with scant resources immediately after the War, Kikuchi says. A number of associations which actively promoted Kaizen and its brand of production management technology came into being . The results were impressive.

“Kaizen in the manufacturing workplace has been a driving force in Japan’s industrial development,” Kikuchi says. Nowadays the majority of Japanese companies practise Kaizen; Toyota is one of the best known proponents. In Ethiopia the idea is that lessons and methodologies which proved so successful for Japanese companies and enabled many to become world beaters can benefit Ethiopian companies at the very start of their business journeys.

“Manufacturing is the engine of economic progress so I view Kaizen as part of the foundation for sustainable development in Ethiopia,” Kikuchi says.

JICA has introduced programmes of quality and productivity improvement through Kaizen in six other African countries: Tunisia, Egypt, Ghana, Tanzania, Zambia and Kenya. But it is in Ethiopia that the philosophy has really taken hold: Ethiopia is the only country with a dedicated Kaizen institute.

Top-level government support and funding directed to the EKI, enabling its staff to grow from 10 to 100, is another reason why Kaizen is flourishing in Ethiopia, Kikuchi says.

The late Ethiopian Prime Minister, Meles Zenawi, was a particular fan of Kaizen and pushed for its coming to Ethiopia through JICA.“Kaizen is the philosophy we like, we agree with, and we believe can make a lot of difference in Ethiopia,” said Meles, whose legacy still holds enormous sway in Ethiopia’s corridors of power.

Kaizen and its tenets will be written into Ethiopia’s next five-year Growth and Transformation Plan set to start in 2016, said Getahun Tadesse, EKI’s Director General.

For all the talk of philosophy, the effects on the ground are matter of fact and practical. Inside Peacock Shoe Factory, distinctive turquoise strips with yellow margins indicate pathways across factory floors; tools are allocated clearly labelled places from where to hang on walls; boxes are stacked neatly in rooms in which diagrams indicate where particularly items are found. It might not sound revolutionary but it wasn’t always like this.

“One year ago it was very different,” said Haileyesus Habte, head of Peacock’s cutting department. A notice board showing before and after photos starkly illustrated the situation before the EKI team got to work: chaotic rooms crammed with clutter in which a Buddhist monk would have felt particularly uncomfortable; and in which finding what you needed took an age, Haileyesus says.

The resulting improvements and time saved means he now no longer has to run around the factory to get everything done.. Another advantage of Kaizen dissemination throughout the factory workforce, he noted, is workers can be instructed and left to organise their work spaces themselves without each one needing supervision.

A fundamental tenet of Kaizen is the organisation of workers into small groups of about five to six persons. Each group is called a Kaizen Promotion Team (KPT) and meets each day to identify and discuss problems or procedures that could be improved. This forms feedback passed on to middle management to consider whether action is warranted.

Sitting on a stool in the finished upper section of the factory floor was Gizachew Sifeta, his fingers encased in protective leather as he sewed, with great speed, an upper leather panel onto the sides of a shoe base.

Gizachew described a previous problem whereby sometimes the holes in an upper leather panel didn’t match the holes in the sides of the shoe base, which left a tiny flap of upper unsecured. His KPT told management about the problem. Now each upper is checked to have the right number of holes before it is sent to the finished upper section. An important quality control check but also production streamlining with beneficial consequences, especially for workers paid per pair of shoes finished.

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Kaizen matchmaker

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“The key is to adopt our methodology to local circumstances,” Kikuchi said. “We work with local people to make things work locally; we equip them to carry on with Kaizen on their own.”

The first phase of EKI’s partnership with JICA involved learning a new concept from Japanese experts, says Yigedeb Abay, director of metal industries at EKI. The second phase that the institute is currently engaged in involves disseminating what has been learned while adding more advanced capacity building.

EKI aims to promote and customise Kaizen in accordance with the needs of Ethiopia and, as a result, is focused on currently burgeoning manufacturing sectors such as leather, textile and sugar production.
The institute has also focused on tackling huge wastage within the construction industry,

Getahun says. As a result, construction times and costs were reduced while quality was bolstered by improving the impact of small enterprises in the supply chain.

Kaizen can even be brought to bear in the making of tasty jams. JICA’s One Village One Project (OVOP) initiative strives to enable farmers in southern Ethiopia to gain value addition for their raw produce.

Converting raw mangos into jars of mango jam sold at supermarkets for higher prices is one result of Kaizen implementation, says Talemos Data, a market linkage specialist with OVOP. Another implementation was taking fibres left over from handmade bag production – and that previously were burnt – to stuff pillows and mattresses.

“Economic development is based on incremental changes,” Getahun says. “So the principles of Kaizen are a good match for Ethiopia.” As well as being preferable to some Western approaches that are more scientific and typically require heavy investment, he adds.

Though that is not to say the Ethiopian government doesn’t want to attract serious investment: Ethiopia’s large-scale infrastructure projects such as the Renaissance Millennium Dam Project are crying out for foreign capital. That need is felt all across the economic board, with small companies struggling to access vital capital for growth from Ethiopian banks unwilling or unable to lend.

But foreign direct investment doesn’t happen spontaneously, says Jin Kimiaki, JICA’s Chief Representative in Ethiopia. Rather FDI needs to see opportunities and comparative advantages in a country. And Ethiopia isn’t in a particularly advantageous position, Kimiaki notes, especially when competing with countries that are more mineral rich, such as the likes of Tanzania with natural gas, Mozambique with aluminium and Ghana with oil, for example.

“So what is the attraction of Ethiopia?” Kimiaki posits. “An essential point for investment is the quality of its labour – it has the second-largest population in Africa, with workers that are disciplined and straight forward.”

Education and vocational training are important components of further improving the quality of Ethiopia’s labour force, he says but so is on-the-job improvements – which is where Kaizen can have a beneficial impact.

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No silver bullet

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The first people to point out the limitations of Kaizen are those Japanese workers striving to ignite the Kaizen movement in Ethiopia.

“Kaizen is not almighty,”

Kikuchi says. In addition to embracing Kaizen’s brand of production management technology, a company also needs to nurture business management technology, manufacturing technology, and designing and planning technology if it is to grow: “You need to strengthen all four – not just Kaizen,” Kikuchi says.

And despite Kaizen’s focus on achieving more with the same resources and equipment, that shouldn’t be taken as a means to avoid investing in new equipment, Kikuchi points out. Kaizen typically results in gradual improvements – if you want rapid change then often you simply need to splash out on quality machinery. Furthermore, there are other important factors beyond the production side such as marketing and finance which can’t be neglected.

There are some who question whether the Ethiopian government really understands that striving to increase capital also needs to include increasing Ethiopia’s precious social capital to ensure future development.

But at the micro level it appears Ethiopia’s social capital is gaining in no small part due to Kaizen. And not just in the workplace. Peacock Shoe Factory’s plans and programme manager, Dawit Birasa, said his home and lifestyle is neater and more organised as a result of his exposure to the lessons of Kaizen.

One of Ethiopia’s most popular radio stations even broadcasts a weekly hour-long programme dedicated to Kaizen.

It can appear that everyone is signing up for the Kaizen treatment. JICA has been liaising with the African Union Commission (AUC) on the creation of a Kaizen Unit within the AUC to help establish Kaizen culture and improve the quality of AUC’s services provided to its member states and stakeholders.

For the foreseeable future, all evidence suggests Kaizen is here to stay in Ethiopia. So don’t be surprised to find more Amharic renditions of a word that when translated gives a particularly Japanese sense of business.

“Kaizen and drawing on the Asian growth experience is our intellectual contribution to Ethiopia’s economic growth,” Kimiaki says.

Sourced here  http://africanbusinessmagazine.com/africa-within/countryfiles/kaizen-japanese-way/4/