Lesson 8: 5S and the Customer

Lesson Objectives
At the end of the lesson, you should be able to:
1. Identify the 5S activities;
2. Differentiate between internal and external customer

Derived from two words, Kai which means change, and Zen which means good,
Kaizen is a Japanese management concept for incremental change or gradual but
continuous improvement. It is a philosophy that assumes every aspect of our life
deserves to be constantly improved. In this lesson we will learn about Kaizen and the
PDCA/SDCA cycles.

Lesson 8.1 Five S

5S is a system for organizing space

so work can be performed efficiently,
effectively, and safely. This system
focuses on putting everything where it
belongs and keeping the workplace clean,
which makes it easier for people to do their
jobs without wasting time or risking injury.

5S began as part of the Toyota Production

System (TPS), the manufacturing method
begun by leaders at the Toyota Motor
Company in the early and mid-20th century. This system, often referred to as Lean
manufacturing in the West, aims to increase the value of products or services for
customers. This is often accomplished by finding and eliminating waste from production
processes.
 Lean manufacturing involves the use of many tools such as 5S, kaizen, kanban,
jidoka, heijunka, and poka-yoke. 5S is considered a foundational part of the Toyota
Production System because until the workplace is in a clean, organized state, achieving
consistently good results is difficult. A messy, cluttered space can lead to mistakes,
slowdowns in production, and even accidents, all of which interrupt operations and
negatively impact a company.

By having a systematically organized facility, a company increases the likelihood

that production will occur exactly as it should.

Over time, the 5S methodology leads to many benefits, including:

 Reduced costs
 Higher quality
 Increased productivity
 Greater employee satisfaction
 A safer work environment

5S was invented in Japan and represents five (5) Japanese words:

Throw away all rubbish and

Seiri Tidiness unrelated materials
Set everything in its proper place for quick
Seiton Orderliness retrieval and storage
Clean the workplace; everyone
Seiso Cleanliness should be a janitor
Standardize the way of
Seiketsu Standardize maintaining cleanliness
Practice 5S daily, make it a way
Shitsuke Discipline of life; also means commitment

It involves assessing everything present in a space, removing what's

unnecessary, organizing things logically, performing housekeeping tasks, and keeping
this cycle going. Organize, clean, repeat.
Sort

The first step of 5S, Sort, involves going through all the tools, furniture, materials,
equipment, etc. in a work area to determine what needs to be present and what can be
removed. A workspace might be better off without unnecessary items or items used
infrequently. These things can get in the way or take up space.

Set in Order

Once the extra clutter is gone, it's easier to see what's what. Now work groups
can come up with their own strategies for sorting through the remaining items. During
this phase, everyone should determine what arrangements are most logical. That will
require thinking through tasks, the frequency of those tasks, the paths people take
through the space, etc.

Shine

The Shine stage of 5S focuses on cleaning up the work area, which means
sweeping, mopping, dusting, wiping down surfaces, putting tools and materials away,
etc.

In addition to basic cleaning, Shine also involves performing regular maintenance

on equipment and machinery. Planning for maintenance ahead of time means
businesses can catch problems and prevent breakdowns. That means less wasted time
and no loss of profits related to work stoppages.

Shining the workplace might not sound exciting, but it's important. And it
shouldn't just be left up to the janitorial staff. In 5S, everyone takes responsibility for
cleaning up their workspace, ideally on a daily basis. Doing so makes people take
ownership of the space, which in the long run means people will be more invested in
their work and in the company.

Standardize
 Once the first three steps of 5S are completed, things should look pretty good.
The problem is, when 5S is new at a company, it's easy to clean and get
organized…and then slowly let things slide back to the way they were. Standardize
systematizes everything that just happened and turns one-time efforts into habits.
Standardize assigns regular tasks, creates schedules, and posts instructions so these
activities become routines. It makes standard operating procedures for 5S so that
orderliness doesn't fall by the wayside.

Initially, people will probably need reminders about 5S. Small amounts of time
may need to be set aside daily for 5S tasks. But over time, tasks will become routine
and 5S organizing and cleaning will become a part of regular work.

Sustain

Once standard procedures for 5S are in place, businesses must perform the
ongoing work of maintaining those procedures and updating them as necessary.
Sustain refers to the process of keeping 5S running smoothly, but also of keeping
everyone in the organization involved. Managers need to participate, as do employees
out on the manufacturing floor, in the warehouse, or in the office. Sustain is about
making 5S a long-term program, not just an event or short-term project. Ideally, 5S
becomes a part of an organization's culture. And when 5S is sustained over time, that's
when businesses will start to notice continuous positive results.

Safety – The 6th S

Some companies like to include a sixth S in their 5S program: Safety. When safety is
included, the system is often called 6S. The Safety step involves focusing on what can
be done to eliminate risks in work processes by arranging things in certain ways. If the
layout of the workplace or the tasks people perform are dangerous, those dangers
should be reduced as much as possible. That's what the sixth S focuses on.
 Execise 8.1

In which aspect of your personal life can you apply the principle of 5S?

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Why?

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How will you do it?

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Lesson 8.2 Customer Value Strategy

Both TQM and ISO are focused on the customer. All quality improvement efforts
lead to greater customer satisfaction.

A customer is a person or company that receives, consumes or buys a product or

service and can choose between different goods and suppliers.

There are two distinct types of customers, the external and internal. Internal
customers are within the company-the colleagues working together for delivering a
service or product for the external customer.

An external customer may be an individual or an enterprise that hires or

purchases the product(s) or service(s) from another person or business in exchange of
money.

One of the most important factors for the success of an enterprise is its
customers. Without them, a business cannot exist. But to capture customers, a
business must try to find out what people want, how much and how often they will buy
and how their post-purchase satisfaction will be ensured.

The main goal of all commercial enterprises is to attract customers or clients, and
make them purchase what they have on sale. They also try to encourage them to keep
coming back.

Customer Satisfaction

It refers to the measure of how products and defined as the number of

customers, or percentage of total customers, whose reported experience with a firm, its
products, or its services (ratings) exceeds specified satisfaction goals. It is seen as a
key performance indicator within business and in a competitive marketplace where
businesses compete for customers, customer satisfaction is seen as a key differentiator
and increasingly has become a key element of business strategy.
 Within organizations, customer satisfaction ratings can have powerful effects.
Therefore, it is essential for businesses to effectively manage customer satisfaction. To
be able do this, firms need reliable and representative measures of satisfaction.
Expectations are a key factor behind satisfaction. When customers have high
expectations and the reality falls short, they will be disappointed and will likely rate their
experience as less than satisfying.

Determinants of Customer Satisfaction

Key Indicators for Physical Products Key Indicators for Services

 Reliability  Friendliness/courteousness of
 Aesthetics employees
 Adaptability  Safety/risk of service
 Usability  Billing/invoicing procedure
 Functionality  Responsiveness to requests
 Appropriateness  Appearance of physical facilities
 Approachability of the service provider
 Willingness to listen to customer
 Honesty and an ability to communicate
in clear language.

External Customer Satisfaction

External customers are the ones who pay for a service or product and can make
or break an organization. Quality must be incorporated into all activities with a clear
customer focus. Customers usually compare perceptions of what they actually received
from the organization with their expectations (what they were expecting to get from the
organization).

Customer delight arises when perceptions exceed expectations. External

customer satisfaction shows the extent to which the organization;

 Uses methods for determining and monitoring external customer's perceived

quality and value.
  Uses customer feedback to improve product/service quality.
 Handles complaints, resolves them, and uses complaint information for quality
improvement and prevention of recurrence of problems.
 Measures performance against customer targets.
 Compares its customer satisfaction results with that of main competitors.
Internal Customer Satisfaction

An internal customer can be anyone within an organization. It could be another

department, another branch or even a co-worker. Getting the internal relationships
working is essential if external customers are to be satisfied. Every single person in the
organization has an effect on the external customers.

Here are steps to improve Internal Customer Satisfaction:

 Treat employees as you would treat your customers

 Share your vision with the employees to make them feel a part of the
company. It can help them align their goals with those of the company.
 Surpass their expectations like offering unexpected gifts or bonuses, arrange
team parties, taking them out for a team lunch or dinner, etc can make your
employees happy.
 Take feedback and suggestions to better understand your employees; you
must know what they feel about their jobs, or their work environment.
 Show appreciation for good work.
 Execise 8.2

Which restaurant (can be a fastfood, café, or fine dining) have satisfied you as a
customer?

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How can you rate their service/s based on the key indicators we have discussed.

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SUMMARY

 5S is a system that focuses on putting everything where it belongs and

keeping the workplace clean
 Some companies like to include a sixth S in their 5S program which is
Safety.
 There are two distinct types of customers, the external and internal
 External customers are the ones who pay for a service or product and
can make or break an organization.
 An internal customer can be anyone within an organization .

Learning
Activity
Find a company with a success story related to customer satisfaction
and customer loyalty. Be ready to present it to class.