Kaizen (Continuous Improvement)
If we are to all agree that you should treat your trading as a business then management theory becomes interesting to look into. Reading how Toyota (the company) handles their business, you come across a very interesting concept. Kaizen.
According to Wiki:
The Sino-Japanese word “kaizen” simply means “good change”, with no inherent meaning of either “continuous” or “philosophy” in Japanese dictionaries or in everyday use. The word refers to any improvement, one-time or continuous, large or small, in the same sense as the English word “improvement”.[5] However, given the common practice in Japan of labeling industrial or business improvement techniques with the word “kaizen” (for lack of a specific Japanese word meaning “continuous improvement” or “philosophy of improvement”), especially in the case of oft-emulated practices spearheaded by Toyota, the word Kaizen in English is typically applied to measures for implementing continuous improvement, or even taken to mean a “Japanese philosophy” thereof. The discussion below focuses on such interpretations of the word, as frequently used in the context of modern management discussions.
Kaizen is a daily process, the purpose of which goes beyond simple productivity improvement. It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work (“muri”), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. In all, the process suggests a humanized approach to workers and to increasing productivity: “The idea is to nurture the company’s human resources as much as it is to praise and encourage participation in kaizen activities.”[6] Successful implementation requires “the participation of workers in the improvement.”[7] People at all levels of an organization participate in kaizen, from the CEO down to janitorial staff, as well as external stakeholders when applicable. The format for kaizen can be individual, suggestion system, small group, or large group. At Toyota, it is usually a local improvement within a workstation or local area and involves a small group in improving their own work environment and productivity. This group is often guided through the kaizen process by a line supervisor; sometimes this is the line supervisor’s key role. Kaizen on a broad, cross-departmental scale in companies, generates total quality management, and frees human efforts through improving productivity using machines and computing power.[citation needed]
While kaizen (at Toyota) usually delivers small improvements, the culture of continual aligned small improvements and standardization yields large results in the form of compound productivity improvement. This philosophy differs from the “command and control” improvement programs of the mid-twentieth century. Kaizen methodology includes making changes and monitoring results, then adjusting. Large-scale pre-planning and extensive project scheduling are replaced by smaller experiments, which can be rapidly adapted as new improvements are suggested.[citation needed]
In modern usage, it is designed to address a particular issue over the course of a week and is referred to as a “kaizen blitz” or “kaizen event”.[8] These are limited in scope, and issues that arise from them are typically used in later blitzes
Continuous improvement is an incredibly powerful state of mind. And I truly believe it is a state of mind. It’s also what separates the good from the great. Granted, of course, that one even becomes good in the first place.
Although people are capable of adopting the ‘kaizen’ mentality, I don’t think many will. Why? Because you have to want it bad enough. You have to want to succeed so bad that you can’t sleep at night. And the reason is not just to get rich, but because you love what you do. Getting great at something is an art form by itself. Continuous improvement becomes the canvas you paint on. It becomes a personal journey. Nobody in this world can make you sit at home on a Friday night and review your trades except you. Only a small percentage of people live, breathe, and believe in this mentality but in fact, it’s life itself. Life is an evolution of oneself. What better way to evolve than to make continuous improvements each and every single day?
Just something to think about.
I will also leave you with this great video by Bernard Hopkins, one of the best boxers of all times… it’s a must listen. Please listen to the entire video. It’s worth every second.
Boris
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