The role of performance measurement in continuous improvement

A research study of both kaizen and re‐engineering programmes in a leading international company indicated that the process life cycle has four characteristic stages. A newly designed process commonly suffers from a variety of teething problems during the initial post‐commissioning phase. Once these have been eradicated achieving smooth product flow becomes important in accordance with JIT philosophy. A stable process may be improved by applying a kaizen continuous improvement programme. A dramatic step‐change in performance may be achieved by radical re‐engineering. It is suggested that each of these phases has its own characteristics which should be taken into account when determining performance metrics and designing approaches to process monitoring and control. Explicitly recognising the stage a process has reached in the life cycle provides guidance for practitioners effectively to direct and manage a programme of performance improvement.