Kaizen is a philosophy that focuses on incremental changes throughout a company, which creates more value with fewer resources to directly satisfy customers. The reasons for doing this are quite obvious - you can add value, stay customer-focused, and scale a small business quickly and efficiently. For larger companies, this means effective use of resources and higher ROI on activities across the board.
Although the exact origins of kaizen being used as a business model are debatable, we can know for sure that it began to be implemented in Japan's auto industry in the early 1950s. Shortly after WWII, the founder of Toyota Industries Co., Sakichi Toyada, implemented the Toyota Production System based on the principles of kaizen. The idea was that small changes over time and across levels of manufacturing could improve the process as a whole. The end result was that these small improvements became large additions of revenue for their company.
When it comes to ecommerce - and this goes for both smaller etailers looking to scale, and larger online giants trying to stay competitive - it's smart to focus on the smaller aspects to see larger results over time.
The central tenet of kaizen, and its strategy of lean manufacturing, is to fix small problems to avoid bigger ones. Everyone from the ground up is attuned to see changes and problems arising so that they can jump in quickly and take care of them when and if they arise. Another tenet of kaizen is to implement a disciplined approach to organization and execution of business activities. This principle can be applied to optimising your ecommerce company in a number of ways, from UX, to Marketing and product fulfillment.
Here are a 5 tips that can help you kaizen your ecommerce site:
1) Hold weekly kaizen meetings
You should hold weekly optimizing meetings centered on kaizen principles across your departments, whether Marketing, Sales, etc. to review processes and discuss improvements. You should be doing this already, but keeping kaizen principles in mind centers the focus of your meetings, and your discussions will be more valuable when you consider tackling the smaller problems that spring up periodically.
2) Create repeatable processes
Make sure that all aspects of your ecommerce store have a repeatable process of activities, whether they are email marketing campaigns, lead generation activities or shipping and returns processes. This will ensure that you are saving time and resource, as well the attention, on tasks that can be set with a formula.
3) Train employees
Kaizen principles need to be applied across an entire company, not just a department, so it is important to make sure that all your employees are aware of their ability to spot and alert the right person when there is a problem. This isnt to say that you should encourage all your employees to start implementing solutions whenever they want to. Instead they should be attuned to the best way to perform their tasks, and speak up when they notice a problem or more efficient method.
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4) KPI monitoring
This is an obvious activity for most ecommerce managers, but your choice of, and monitoring of Key Performance Indicators should have a lean approach to achieving your goals. KPIs will be different for each company and the stages of growth that you are working towards. Think about which metrics are simply making you look good, i.e. vanity metrics, and focus instead on where you would like to see improvement. If one aspect of your company is going well, for example your email marketing campaigns, track the ROI. But dont neglect other aspects of online growth and marketing strategy that arent producing such high returns.
5) Continuous improvement initiatives
Implementing the kaizen philosophy across your ecommerce shop requires that everyone get involved. And that means providing an initiative to constantly look for small improvements and a culture of optimisation. The web is a vast open forum that changes with the way people use it on a daily basis. The only way to keep up with the latest and best ways to optimise your ecommerce website, is to be aware of the fact that no process can be perfect, only more optimised. You can begin by focusing on small iterations like tracking your best-selling products, and periodic A/B testing. This will ensure that your ecommerce activities are always being improved, which in turn will increase your revenue and efficiency.
All of these tips are meant to guide your optimization efforts. For more in depth knowledge on optimising your ecommerce website, please read the following: