We would never undertake anything if we wanted to ensure in advance the success of our company ”
Napoleon Bonaparte Emperor of France.
The economic liberation and the abolition of a protectionist model have forced public and private companies to adopt a new competitive position against their counterparts, for this reason the leaders of the organizations must implement a new culture of constant change that allows defining the current situation and improve it.
Below I will give a brief overview (from a very personal point of view) of how continuous improvement arises and how companies could use it to achieve success in their organizations.
Precedents and evolution of continuous improvement
Man's need to improve day by day has been present in all stages of human evolution, this is how primitive beings developed tools suitable for hunting, clothing and food. All this with the firm intention of increasing their standard of living.
What is really important here is the continuity of improvement that was given to the daily processes of primitive life, and it is there that continuous improvement led to the development of techniques for hunting and the evolution of weapons such as the spear or the mallet, instruments that arose from the basic need for food, which also facilitated their daily tasks.
Not satisfied with this, they optimized each resource available at the time, in such a way that hunting an animal not only provided food but perhaps allowed them to cover their bodies and protect themselves from the inclement weather, typical of the time.
Thus, human needs have been changing, and in the same way, the way in which the human being must face them, it is here where the creativity and innovation of man plays a very important role in which all available efforts and resources are involved. for the achievement of the proposed objectives.
Theorists like Abraham Maslow, and Ludwing Von Berthalanffy were interpreters and visionaries of the importance that continuous improvement would have in modern times. For the first; motivation is essential in the development of people, and is achieved through the satisfaction of needs; where the human being is expected to achieve higher degrees of performance motivated by the obligation to constantly improve1.
In the same way, Bertalanffy proposes a concept much closer to continuous improvement, in which it is evident how the result of a process depends both on the inputs that enter it, and on its self-regulation and constant improvement2. This is how constant motivation and systemic thinking leads to continuous improvement, motivation as a vehicle and the administrative systemic approach as the need to interrelate elements dynamically.
At present, continuous improvement is a system that has inputs, processes and outputs that must be constantly improved and fed back with the intention of satisfying the current needs of customers on a daily basis and exceeding them, this will allow the customer to give a higher assessment, that is, to pay a better price for the good that is being offered and thus achieve success in a market economy.
Other Western theorists such as Frederick Taylor, Frank Gilbreth and Henry Gantt, were concerned with improving production processes, affirmed that any work can be improved through specialization and control of times and movements, concepts that are still valid today.
Some criteria inherited from the West are taken up in Asia; For example, Deming, believes that quality is achieved by controlling processes, reducing production times, and unifying quality standards. William Ouchi, transforms administrative thinking with theory Z, which is more than a theory a new culture that can transform entire nations.
"It is important to understand the concept of total quality, as an interminable and continuous process, in which great transformations are not made, but small constant changes, which should lead to improving productivity in organizations."
Thus, in eastern organizations, Kaizen3 is seen as a Philosophy, or a new culture that leads to the improvement of both people and companies, this has allowed the growth of large companies, which in turn have been dragging the economic development of their countries.
I could cite several examples, in which Kaizen has been a determining factor in business success. One of them is the Toyota Motor company, 4 which has come to occupy the eighth position among the most important companies in the world, in the first instance because in 2002 it generated 264,096 direct jobs, that is, 9.36% 5 of the unemployed in Colombia for the same year. And secondly, because it achieved income of 131,754.2 million dollars for the year 2002, when the GDP of Colombia for the period of 2002 was 80,475 million dollars; Likewise, in 2003, it ranked number eleven6 in the ranking of the most valuable companies in the world, with a net worth of 20.78 billion dollars.
Another oriental company that is worth mentioning here is Mitsubishi7, an organization that has managed to be one of the 10 best companies in the world, obtaining revenues in 2002 worth 109,386.1 million dollars, and employing a number of 47,370 people during the same year. Making a simple comparison between the gross domestic product of Colombia in dollars for 2002, and the income received by Mitsubishi, we can realize that all of Colombia only generates 73.56% 8 of the income of this company.
However, the prosperity of some eastern nations, caused by the constant improvement of their main companies, is not the only reference that I want to bring up in this writing. There are other successful examples that are worth considering when it comes to innovation and continuous improvement.
The first of these has to do with two Scandinavian countries, which, thanks to the innovation and continuous improvement of their main organizations, managed to change the traditional activities to which they were engaged to become exporters of cutting-edge technology9.
These are Nokia 10 and Volvo 11, the first of Finnish origin and the second of Swedish origin. These organizations are present in the world, Nokia for example, with its introduction to the mobile phone market, was ranked as the fifth most valuable company in the world for the year 2003, valued (according to fortune 2003 magazine) for 29.44 billion dollars, taking over very important companies such as: INTEL, McDonals and Hewlett-Packard, among others.
Likewise, in Sweden, there is a transition from a traditional timber industry to the automotive industry, specifically with the Volvo company, which managed to transform the mentality of producing primary goods to undertake the manufacture of a product (luxury vehicles) manufactured with high quality standards.
However, the success of Toyota, Mitsubishi, Nokia and Volvo is not only due to the implementation of continuous improvement, but also to the way in which they took on the challenge of globalization.
“The intention of citing the previous examples is to show the responsibility that companies have towards their countries, and also demonstrate the obligation they have to be better every day. Well, awareness must be created that competitors are not only located within borders. Well, their counterparts in the rest of the world are too. "
Thus, I will enter to give an approximation of the concept of globalization and the way in which companies and organizations should assume it based on continuous improvement.
Continuous improvement in the global context
Globalization is a process that seeks the integration of the nations and organizations of the world, fundamentally from four strategic points. The first is the economic, the second is the political, the social is the third and the fourth factor is the environmental or ecological.
To understand the evolution of this phenomenon, it is necessary to cite four transcendental historical milestones that transformed an incipient mode of production into what we now know as globalization, this integration process begins with Marco Polo's expedition to China in the thirteenth century and travel of Christopher Columbus in 1942, where cultural and economic exchanges took place, as a result of this there is emigration (characteristic effect of globalization) from Europe to America, and this is how the French come to occupy Canadian lands, the English territory North American in Massachusetts, Virginia and Connecticut, the Dutch are going to settle in New Amsterdam, and the Portuguese and Spanish in South America.
The second important fact is located in the industrial revolution10 and the mechanization of processes. These two factors influenced the increase in the productivity of the industries of the time, the usual production tripled and made the factories increase the stock of raw materials, forcing the importation of inputs and experimenting with new economic relations with other nations, encouraging thus also the export of finished products.
After the decline of capitalism11 and the rise of the new economic thought of John Maynard Keynes. We find the third fact that leads to the current concept of globalization, which has two important components, one of them is the development of the Marshall Plan12 and the second is the initiation of the cold war 13.
With the division of the former Soviet Union and the fall of socialist ideals, capitalist thought ceased to be another alternative, to become the best option for governance, and that is how it was understood by the countries of the world, the fact was so evident that the creation of the International Monetary Fund14 was based on this thought.
The foregoing gave way to the fourth aspect, which consisted of the economic emergence of the countries known as the Asian tigers15 that, forming an economic bloc with Japan, and accompanied by an acceptance of China to the economic opening, showed the convenience of introducing the nations to a market economy, providing sufficient foundations to multilateral credit organizations to demand and commit governments to adhere to recommendations in order to access soft loans and thus leverage their economic development.
Some of the recommendations that should be adopted by the countries of the periphery, according to multilateral organizations are:
Replace fixed exchange rates with floating exchange rates.
Adoption of low and flat tariffs.
Elimination of export subsidies.
Reduction to state intervention and privatizations.
Making macroeconomic adjustments that lead to fiscal and commercial balance.
Strict control at the price level.
Import substitution policies.
In Latin America, the implementation of the globalization model forced drastic changes to the exchange and trade legislation, which began briefly in the early eighties and was strengthened in the nineties with the transformation of the GATT16 in 1996, as we know today as OMC.17
"In Latin America for example, tariffs were reduced from 45% in the mid-eighties to 12% in 1999."
Globalization has not only had structural and conceptual changes but also etymological ones, because if we remember the concept has been transforming. In the sixties for example, the term that best suited globalization was “deregulation of the powers of the state”, later in the seventies and eighties the most pertinent concept to use was globalization, and nowadays we have even talked about the global village.
All of the above, accompanied by a great technological advance in telecommunications and information technology, have allowed the consolidation of a global market, in which the possibilities of the state to intervene between commercial relations are limited, to make way for supply and demand to meet. freely regulate as Adam Smith stated since 1776 in his book Cause and Origin of the Wealth of Nations.
"Currently computers play a transcendental role in decision-making, as they provide information and communication, two key pieces in business"
There are different positions about globalization, there are those who agree with it, however there are also those who do not, if we put in a balance all the aspects rooted in globalization, we would have to look at the positive factors on one side, such as example: the need to be competitive, the reduction in transportation and communication costs. And on the other, the harmful aspects such as: inequality in terms of the productive factors that each nation has and the distribution of income.18
My personal criterion is that it is an inescapable reality and as such it must be understood and faced. I understand globalization as the highest level of evolution of the capitalist production model, where private interests prevail over general ones, and which by its own characteristics reduces the powers of the state, encompassing increasingly extensive scenarios of action. Giving a leading role to companies, allowing them to be the main managers of international economic relations, and help solve endogenous and exogenous macroeconomic problems19.
Likewise, I consider that globalization must be faced with a high degree of competitiveness and commitment by each of the actors that intervene there, we must be aware that today's world is changing and we are obliged to be better every day, therefore improvement Continuous is the answer to the challenge in which we are involved today.
Now having clear the origins and the concept of globalization, I will finish by mentioning eight actions that in my opinion current organizations should take:
1. Even though continuous improvement depends fundamentally on constant change, it does not mean that the actions to be carried out should not have prior planning.
2. Develop excellent training plans.
3. Empower all work teams.
4. Establish very well the strategic objectives of the organization and be constant in the actions that will be developed to achieve them.
5. Change bad work habits within the company and institute a new organizational culture.
6. Make staff aware that their work is part of a process and therefore it is vitally important that it develops well
7. Execute actions to improve without fear of shoeing.
8. Perform performance evaluations on a regular basis.
Information sources
Bibliography:
- Drucker, Peter, The Management Challenges for the 21st Century. Editorial Norma SA Bogota Colombia. 1999.Rudinger Dornbush, Macroeconomics. McGrawHill Publishing House Seventh Edition. Aravaca Madrid Spain. 1999.Idalberto, Chiavenato, Introduction to the General Theory of Administration. Editorial McGrawHill. Bogotá Colombia, 1997 Stiglitz, Joseph E., The Discomfort in Globalization. Editorial Taurus, Bogota Colombia, 2002. Mosquera Mesa, Ricardo, Globalización Y Alca, America Para Los Americans. Editorial Unibiblos, National University of Colombia. Bogotá Colombia, 2003. Graham, Bannuck, Dictionary of Economics. Editorial trillas, First edition. México DF México, 1990. Jean Romeuf, Dictionary of Economic Sciences. Editorial Labor S, A, First edition. Barcelona Spain, 1966. Echavarría, Juan, Journal of Economic Situation "Technical Change,Investment And Industrial Profitability In Colombia ". Editorial Fedesarrollo. Bogota Colombia, July 1990.
Hemerography
- Montenegro, Santiago, Effects of Outward Growth. Report of the National Planning Department and Economic Commission for Latin America, Bogota Colombia, September 7, 2004. The best 10 companies in the world Forbes Magazine, Editorial Global 2000, The world's largest corporations, Fortune Magazine, 2003.
Cybergraphy
- Statistical information of the National Department of Statistics DANE, See: http: //www.dane.gov.co. Statistical information of the National Planning Department DNP, See: https://www.dnp.gov.co/Paginas/inicio. aspx. Statistical information of the World Bank http: //www.bancomundial.org. Publications of the Autonomous University of Mexico, See: http://www.tuobra.unam.mx. Publications of the University of Nueva Esparta of Spain, See: http: //www.une.edu.ve. Essay “A recipe to stop creating poverty II By Agustín Etchebarne, See:.
1. Concept developed by Abraham Maslow in the hierarchy of needs model. Later this same model was taken up by Frederick Herzberg in a new motivational theory.
2. Concept defined within the general theory of systems by Ludwing Von bertalanffy as feedback.
3. Concept devised by Maasaki Imai, in which the Japanese criterion kai "which means change and" zen "improvement is combined.
4. Japanese automobile manufacturer industry.
5. This index was created based on the information provided by Fortune magazine, 2003 and the National Planning Department, report from Santiago Montenegro, September 7, 2004.
6. Information provided by Fortune magazine, 2003 (Internet publication).
7. Japanese electronics and automotive industry.
8. This index was created based on the information provided by Fortune magazine, 2003 and the National Planning Department, Santiago Montenegro, September 7, 2004 report. Sweden and the Philippines have been countries that were traditionally dedicated to the timber industry.
9. Philippine company pioneer in the manufacture of cellular telephone devices.
10. Swedish luxury car manufacturer.
11. Grouping of 4 countries (Hong Kong, Taiwan, Singapore and South Korea) from Southeast Asia.
12. Acronym in English "General Agreement on Trade and Tariffs", which in Spanish means General Agreement on Trade and Tariffs.
13. The body created to monitor compliance with the trade rules approved by the GATT, it also has the right to sanction violating countries, the world trade organization (WTO) begins work on January 1, 1995.
