″Continual Improvement″ for Competitive Advantage
| Pages | 4-10 |
| Date | 01 January 1990 |
| Published date | 01 January 1990 |
| DOI | https://doi.org/10.1108/02635579010141628 |
| Author | Michael Pettersson |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
4 INDUSTRIAL MANAGEMENT & DATA SYSTEMS 90,1
"Continual
Improvement''
for Competitive
Advantage
Michael Pettersson
A
deductive rationale to make continual
improvement the primary policy of any
organisation.
Introduction
Can you say, of your (section of your) organisation, that
"every day and in every way it becomes better and
better"?
To
justify your confidence, can you describe the
mechanisms of change that are institutionalised to make
continual improvement a predictable achievement?
Can all
your staff describe how their departmental goals are set
and achieved and how much better their operation will
be next year than this year and than last year? And how
did "better" get defined anyway?
In nearly 20 years as a manager in multinational and
household-name companies, I have noticed progress in
the organisation of change. My observation is that,
although the component procedures that are necessary
for predictable continual improvement now exist, their
coherent application is extremely rare. My belief is that
as our rate of change continues to accelerate, an explicit
continual improvement policy will be seen as necessary
though, alas, not sufficient for survival and growth as a
profitable entity.
"Continual improvement" is not a standard management
practice. Few would denounce or deride it but, equally,
few put it at the starting point of their activities. Hunt
through the literature on how to run your business or your
function or through the literature from the business
schools and you will not
find
it. It crops up in discussion
of just-in-time manufacturing techniques but rather as a
spin-off effect than as
a
leading
principle.
Suzaki's excellent
book is something of an
exception[l].
The importance of
making continual improvement the primary policy is that
it will change the goals you set and the strategies and
policies for reaching them.
Recognising the Necessity for "Continual
Improvement"
There is a cogent, deductive argument for a primary
continual improvement policy, based on familiar views of
(1) Darwinian natural selection through the survival of the
fittest in changing circumstances, and (2) the speed that
technical change has reached. It runs as follows:
• The rate of
technical
change,
which has accelerated
steadily throughout human history, is now so fast
that individuals can expect to experience huge
technical and consequent social and economic
changes within their lifetime. The doubling-time for
human knowledge has reduced, over the life of
Homo sapiens, from the order of hundreds of
thousands of years during the Stone Age down to
merely centuries or decades at present.
• This is not a magical process. Technical change
results from the discovery, spread and application
of new knowledge of the physical world, that is,
from
R&D.
The output from
R&D
depends on: (1)
the motivation to undertake it; (2) the brainpower
behind it, and (3) the technical resources available
to it.
• The vital imperative to master new techniques and
materials, as the expanding population reaches the
limit supportable by existing techniques, would
cease to motivate
R&D only
if the human population
were to reach a natural steady state. The repetition
of this pattern throughout human history is well
illustrated by Harris[2].
• Ever-increasing brainpower and technical resources
come respectively from the growing human
population and from cumulative R&D output. The
rate of technical change increases exponentially
because the outputs are fed back as extra input.
• Changes of circumstances exert Darwinian selec-
tive pressures. Species or
organisations
that
previously flourished may become extinct through
an inability to compete in new circumstances.
As
the rate of
change
increases,
it
becomes more obvious
to individuals that the only alternative to the performance
improvement and growth of an organisation is extinction
and that maintaining the
status quo
is not an alternative.
The (only) guiding policy for the members and directors
of an organisation who take this view of the world and
who wish their organisation to survive and to grow as a
profitable entity is to:
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