Journal of business initial document
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This study explores the practices and challenges of implementing kaizen at small and medium enterprises (SMEs) associated with Entoto Polytechnic Cluster College in Addis Ababa. The findings indicate moderate implementation success but highlight significant challenges, including gaps in knowledge and infrastructure, lack of administrative support, and negative attitudes towards kaizen. The study identifies key dimensions affecting performance and suggests a framework to enhance organizational effectiveness within the context of kaizen and business development.
Journal of business initial document
- 1. Vocational of Busines Education and Management Unit College of Edcuation and Behavioral Studies Addis Ababa University International jornal of business and commers Practices and Challenges of Kaizen Implementation at Entoto Polytechnic Cluster College in District 3 of Gulele Sub City, Addis Ababa Berhanu Tadesse Taye E-Mail: berhanutat@yahoo.com Berhanutaye17@gmail.com www.bertat.bright.light.com www.slideshare.netberhanutadesse90
- 2. 1. Abstract This study is on practices and challenges of kaizen implementation at Entoto Polytechnic Cluster College in District 3 of Gulele Sub-City in Addis Ababa. The study investigated the practices and challenges of implementing Kaizen at Small and Medium Enterprises working with Entoto TVET Cluster College. The study was undertaken in Menen Industrial Area in the particular sector of General Metal Fabrication (GMF) and Wood Work Technology where there were 12 SMEs which was involved on it. Nevertheless, the study mainly focused on six of those Enterprises which were more capable of implementing kaizen than other organizations. Available literature has justified the paramount of importance of kaizen strategy in different parts of the globe. In globalization era, the world gets organized in the form of economic unity which necessitates quality management system, like kaizen. Asian countries have mostly implemented successful kaizen strategy to ameliorate the problems in quality management system. Kaizen which originated in Japan before in 1986’s but their prominent author Masaaki Imai wrote about it in the mentioned year. The term represent among others it is one of means that has been used to improve elements associated with organizational performance and effectiveness, with benefits already well documented. Kaizen is a quality standard that aims at continuous improving on the current quality standard. Kaizen is a collective term of productivity improvement, creative idea and innovation expected from entire workers by following a bottom- up management; it has a procedure and problem solving mechanism suggestion system. The objective of the present study is to gain a deep understanding on practices and challenges of implementing Kaizen at Small and Medium Enterprises - which are working in collaboration with Entoto Technical Vocational Education and Training (TVET) College in district 03 Administration of Gulele Sub City, Addis Ababa to identify the dimensions and practices and challenges of implementing Kaizen. Further, the aim is to clarify how the Kaizen implementations in SMEs have affected their performance. The empirical evidence is based on multiple case studies from the perspective of the implementers the trainers (SMEs) and executive. This study builds a framework for a management theory of organizational performance and effectiveness kaizen versus business process re-engineering (BPR) business development success in the SME-context, based on literature from the areas of project and change management, entrepreneurship and small business management, as well as performance measurement, and on empirical evidence from SMEs. The framework consists of six success dimensions: Implementation of kaizen strategy including benchmarking and innovation practices, Overall Successes of kaizen implementation, Challenges of kaizen implementation on SMEs, Over all challenge of kaizen implementation on attitudes, knowledge and skills of trainees and trainers, Strategy used to address the challenges, Availability and facility of the implementation of kaizen in the Entoto TVET and SMEs. To address that objective, mixed research design was employed, (i.e. quantitative and qualitative data collection methods). A purposive sampling technique was used to select the colleges and SMEs and convenient/availability, sampling, non probable sampling and snowball sampling technique was employed to select sampled respondents. Both quantitative and qualitative data were collected from 80 respondents using questionnaires and from 7 informants using semi-structured interviews as primary and secondary data
- 3. sources (such as various published and unpublished documents) respectively. The quantitative data were analyzed through descriptive and inferential statistics with SPSS Version 20 in particular of independent T.Test, whereas the qualitative data were analysed using thematic and content analyses. Hence, without assigned appropriate management system, it is impossible to ensure sustainable economic growth and development. Without creating strong awareness of all stakeholders about kaizen, they worked in the form of synergy. Asayehgn Desta (2013) argues that the Ethiopian manufacturers are still going on as a drawback about getting human capital and asset. The manufacturing sector is less than 5.0 percent of its contribution to the Gross Domestic Product due to lack of highly skilled human resources. Those executives, implementers, and owners of the MSEs were found to be lack of the proper implementation of Kaizen as a performance of knowledge, attitude and skills. 1.1. . Introduction One of the primary benefits of Globalization is that; it brings the whole world together for sharing technological equipment and other human innovation to ease the lives of human in terms of business communication, e-learning, e-business/e-commerce, among others device for exchanging ICT, medical, and transportation devises with each other. Thanks to the innovator which changes the way of life of the human being the globe itself changed in to one village for the purpose of using technological device. In this era the world organized in the form of economic Correlation, for marketing purpose, import and export purpose where our country Ethiopia also a part of this economic Correlation or unity. With this respect the competitiveness happen to the enterprise capability to pursue the world market and will be owners of the global market the enterprise determined by the provision of quality product and service for their customer, through the long term improvement process of their enterprise which mean according to the customer need and want. For example, if one enterprise competent enough from other within similar producers determined by quality product of the enterprise which bring in to market. This will convey by the quality management system including team work and team sprit which leads have power over quality production it is important for the survival and the sustainability of every enterprise. The expenditure of a proficient skill, entrepreneurship and escorting of best technological quality work, for the productivity of work by embracing a quality production and service delivery, without any types of input; such as, the availability infrastructure and the availability organizational structure in the enterprises, it doesn’t bring profitability and success to an enterprise. From this standing point, SMEs development policy is designed for undertaking a proper work of an enterprise, by launching the industrial extension and technology transfer position at several government office level and TVET college level. Hence, for this purpose the Kaizen embrace the supporting system SMEs by industrial extension and technology transfer team. The supporting system functions with different activities including; by identify their problem it provides a work base training and development depending on their need, encourage the MSEs lifelong learning to go together with this dynamic world like entrepreneurship, business communication, etc. Fully equipped for SMEs information and other important technological transformation, creation of job or employment opportunity, documentation and in general over all aspects of organizational consultancy service etc. the main purpose of the position commenced for capacity building i.e. kaizen implementation program for SMEs. The findings of the research showed that there was moderately implemented kaizen strategy. The kaizen implementation indicated that there were also success stories, but there had been challenges which emanated from various sources, like gaps in knowledge of executives, trainers and employees; their negative attitude towards the kaizen implementation; their lack of knowledge and skills; gaps in available infrastructures and material resources; and gaps in the capacity and capabilities of the management body. The majority of the respondents elicited that they did not take any training regarding the use, and
- 4. implementation of kaizen, there were no adequate administrative supports, feedbacks and encouragement for smooth operation of Kaizen. The present Entoto TVET Cluster College was established in 1925. The provisions of education serve as primary school gradually improve the provision in to secondary education. Since its foundation until 1974, it was known by the name of the then Emperor Haileselasie I of Ethiopia - ‘Teferi Mekonen’. When the military Government of Ethiopia came into power, its name was changed to Entoto Comprehensive Secondary School in 1974. The College was legally established according to Proclamation No. 22/1999 published in the Negarit Gazette. Entoto TVET College is one of the known and giant public TVET clusters found in Addis Ababa. In 2000, it however changed its name to Entoto TVET College. The new reform of the TVET Strategy in the country was also amended in 2011. Thus, the previous name of the College was changed in to Entoto TVET Cluster College. Since then, it has been named as Entoto TVET Cluster College. The College offer training on different skills that may require more practices only in (hard skills) both in the premises and in the provisions of Training on Kaizen in the enterprises. During the time of data collection, the College was offering the Training at Level I to IV on those occupations, including hotel management, information technology, metal and wood work, automotive technology, drafting and survey, construction technology, textile and garment technology, electrical and electronics, and aesthetics. All those occupations are derived from the National Occupational Standards (NOS) prepared by the Ministry of Education in collaboration with the stakeholders (Alemu, 2012). In line with the Training Programmes designed in the College, it was implementing Kaizen Training in the enterprises. The TVET College has its own criteria to offer the support of Kaizen Training. A guideline and a plan were prepared to facilitate the implementation of Kaizen Training Programme. Accordingly, the TVET also received financial support from Addis Ababa TVET Agency for those enterprises providing Kaizen Training. The Kaizen Training is generally supposed to pass through series of steps: meeting appointment with enterprises and undertake Kaizen Training implementation after they have got confirmation, and planning of the Kaizen Training within the enterprises. The Cluster Kaizen Team is undertaking kaizen implementation by signing of Memorandum of Understanding (MoU) for the purpose of getting confirmation from enterprises for establishing Kaizen Training sites, assigning Training Coordinators, inspecting Training sites, and Monitoring and Evaluating the Programme (Berhanu, 2011). The College also developed various formats to facilitate the implementation of Kaizen at the level of the enterprises and to provide promotion from their level one step ahead after providing National Assessment and Certification (NAaC). The following qualitative based paragraphs indicated the studied Enterprises experienced moderate level of implementing kaizen and associated challenges. Firstly, DTM Metal and Wood Production Enterprise produced office and home furniture, contributed to employment creation, and had a capital of ETB 2500,000. However, the growth of the Enterprise was evaluated as low which was below the expected level when compared with that of the newly established enterprises in accounting and documentation system. Secondly, Dobbe and ATW Metal and Wood Production Enterprises manufactured office and home furniture, and garment machineries. Moreover, the Enterprises created job opportunities for 8 male and 2 female of their members. The Enterprises were inaugurated with a capital of ETB 1200 in 2009, but its current capital reached ETB 720,000. They implemented kaizen in their contexts with the Ethiopian Kaizen Institute in 2012 properly. Thus, the management system of the Enterprises revealed a potential for improving their production values.
- 5. Thirdly, ATW Enterprise began with a capital of ETB 80,000 in 2013 and the current capital was ETB 146, 343.59, and also had estimated assets worth more than ETB 400,000. Concerning the kaizen implementation, it was the most successful implementing Enterprise. ATW Company offered Cooperative Training to students who had come from Entoto TVET College as the former signed Memorandum of Understanding (MOU) with Entoto College. Fourthly, Berhan Aschalew Ena Godegnoch Construction Enterprise had a capital of ETB 238,563. The Enterprise grew slowly compared with those newly established similar enterprises. Fifth, Wondeson Robel and Godegnochu Enterprise started its operation with an initial capital of ETB 3,500and then reached at current capital of ETB 5,957,607 in 2014. Before the implementation of Kaizen, the members did not have machinery maintenance plan. Two machines in the Enterprise thus stopped working. After implementing kaizen, they started cleaning the machine, scrap material and lubricant properly. The Company had a capital which ranged from ETB 300,000 to 350,000 in June 2014, and had a budgetary capital of ETB 595,767. Owing to kaizen implementation, the Enterprise significantly increased its assets. The growth of the Enterprise is good after the members have started implementing Kaizen. The 3 MSE Office’s directory report depicted until September 2014 the capital of the enterprise showed that 200,000 birr only hence, they had not accurately registered their capital. Sixth, Beza Metal and Wood Work Enterprise started with an initial capital of ETB 5,000. However, its current budget reached ETB 200,000. Before the full implementation of kaizen, there were some of the problems like layout problem; unsafe environment; unsafe electric installation which was exposed to fire and other damages; lack of clean working environment and workers’ personal hygiene problems; sanitation problem in the production room; there were no office; and lack of store. The members prepared detailed work description following Kaizen implementation and assembly of transparent steel for the room; cleaned production room and retouched the room idea; disposed waste; constructed Office; rendered consultation for purchasing and marketing demand situations and electric installation; and started consulting sanitation. But the Enterprise grew below the expectation when compared with the newly established enterprises. The members of the Enterprise borrowed money from Addis Credit and Saving Micro Finance for purchasing machineries, but managed to pay back their loan. Although the Enterprise was found in a relatively better position, there was no proper financial documentation. The findings of the study came up with a mixed picture of the kaizen strategy implementation – success stories and challenges. SMEs and implementing bodies have low level of awareness about the benefits of kaizen management philosophy. The stakeholders’ participation in the management and delivery of kaizen implementation is inadequate. The introduction and implementation of kaizen training is carried out without proper participation of key stakeholders, including all sectors which should work hand-in- hand in District leaders. The AACA-TVET Agency, Sub City and the TVET College have not fully involved in matters regarding the importance and the utilization of best alternative for organizational performance and effectiveness for productivity of the SMEs. The Kaizen Team members at all level have low capacity in benchmarking, innovation, and low level of ability in adopting and transferring technology to the users. In every organization implementation of 5s can be assessed using the parameters provided in the appendixes 9 of this thesis; table (4.11) standard criteria for identification of necessary equipments and parts set for the future and in appendix 10table (4.12) the follow up of systematic arrangement should have to use the following guide. Firstly, the implementation of 5s in the enterprises were observed that against standard which set by the Kaizen training according to their pace of organization implementation phase. For this reason rating takes place when we say the enterprises were lower in average. It could be provided at lower level. For example, when the enterprises pace of implementation frequency like things
- 6. have not used once in the last 6-12 months their storage methods show as throw out store at distance or Keep in store rated as lower level. The second one is said to be average performers of frequency 5s, when we say average performers organization uses the pace of the enterprises. They should have to implement frequently use things they have used only once in the last 2-6 months. Storage methods of the organization should have to Store in central place of its zone store it in central place in your zone rated at average level. The last part of this organizational assessment is frequency implemented, stored in methods of organizational and rated 5s. If things are used more than one month, the storage methods also should be used to store in central place in the zone. We can say that the performance of the college/enterprises is highly used to implement within a week and a day, an hour, a minute and seconds. Methods of storage the enterprises are used to store near the workplace which is easy for production. The rating of the implementation of the organization is said to be higher performance from other which cannot implement as them. The rating scale results also explained as follows, ATW engineering enterprise has got a score 120 the first one from other enterprises in terms of kaizen implementation from the same areas of production. Dobbe enterprise which scores 110 stands second followed by Ralcon enterprise which ranks third. The forth rank is Beza,enterprise followed by the fifth and sixth rank DTM and Lalibela enterprise respectively. According to the levels of the enterprises parameter, except ATW, Ralcon and Dobbe enterprises the others were not implemented5s properly. The fourth place provided for Beza enterprise by its human resource numbers of employees haired than other. In the enterprises that were observed the standard which set by the Kaizen training according to their Pace, concerning human capital ATM engineering and Dobbe enterprises better position than other enterprises. The methods of their bookkeeping and accounting system are in a better position than others enterprises; they are ethical, honest and open. The criteria which offer first position from others enterprises are more than five innovation discovered by ATW engineering enterprise such as modern weaving machine, knitting machine, movable clinic and among others. Training was not given to the kaizen trainers based on their gaps in knowledge and skills. For this, lack of adequate finance has severely affected the successful operation of the kaizen implementation. This is reflected in terms of inadequacy of the training materials, lap top, LCD and other supportive items at the College. Conversely, the majority of the practitioners in the SMEs express their positive views on the implementation of kaizen. They have been actively and effectively involved as team members and participants in the implementation of kaizen. Therefore, attitude towards kaizen implementation vary from individual to individual as it is a difficult to clearly understand the attitude of the person is either positive or negative - attitude seems covert behaviour. There are also benefits of kaizen implementation at those Enterprises – for example, package of benefits like shortening time for getting items in the respective Workshop which has taken 10 to 15 minutes before arrangement, gaining additional width of the workshops, areas of space, reduction in implementation expenses and incomes in those Enterprises. Those trainings offered by the College have positively contributed to such outcomes of the Enterprises However, there are challenges encountered in implementing kaizen strategy in that they have shortage of human resources, but they cannot maintain their out-of-date machineries. Generally, there are other miscellaneous challenges in the implementation process which include: policy, curriculum, training materials and equipment, demand and supply for training of trainers, market information, lack of competency for preparing training materials at the grassroots level, lack of required up-to-date facilities and
- 7. equipment, incompetency of trainers, limited involvement of the private sector and NGOs in providing training based on demand and supply principle, and limited skills. In conclusion, kaizen strategy is moderately implemented and practiced at those SMES, but there are multi- faceted challenges which have emanated from different levels of the implementing organizational structures in Gulele Sub City and Addis Ababa. Therefore, the stakeholders should consider those stories as good lessons to effectively address those challenges identified. It is recommended that those stakeholders at different levels should consider such practical lessons and challenges while implementing kaizen/TQM as a quality management strategy in the City.