A3 methodology: going beyond process improvement

1. Introduction

The increasing level of market competition for industries has made the implementation of lean thinking a robust approach to be adopted (Herzog & Tonchia, 2014). By definition, lean thinking is widely understood as a concept that leads to excellent performance and competitive advantage (Womack & Jones, 1996). In this sense, Thangarajoo and Smith (2015) define lean thinking as an approach to a production system that is carried out to effectively and efficiently create value, with a focus on consumers and the company's competencies.

The high number of implementations of lean thinking, especially in industries, is due to the many benefits obtained from its application (Rini, 2021). Some of these advantages are greater process understanding, reduced inventory, less waste, reduced lead-time, less rework and financial savings (Girardi & Tortorella, 2015).

In order to achieve these goals, companies heavily invest on the implementation of quality systems that bring problem-solving methodologies and continuous improvement, such as plan–do–check–act (PDCA), define, measure, analyze, improve and control (DMAIC) and A3 Report (Bassuk & Washington, 2013). These systems are based on reducing errors, waste, redundancies and streamlining processes (Yorukoglu, Ozer, Alptekin & Ocal, 2017). In this sense, Bassuk and Washington (2013) state that problem-solving and continuous improvement methodologies come in various shapes and sizes, giving managers the option to choose the one that best suits their company.

Major problems are usually solved through activities that are detected and controlled by management. The way this company is able to increase performance is through leverage and focus. The lean production system (LPS) imposes basic problem-solving on all employees. In this way, each employee can become a problem-solver, making it possible for the company to effectively leverage its personnel resources. For more complex problems that require a high degree of problem-solving skills, management members are trained through Kaizen events. According to the LPS philosophy, the information needed to describe a problem is: a description of the current situation and historical trends, the goal, including the difference between the goal and current status, and the detailed description of the problem (Liker, 2004).

Among the various methodologies created by quality systems to solve problems and implement continuous improvement, we highlight A3 report. It is a method that emerged at Toyota and became popular among Japanese companies (Rodrigues, 2014). A3 is an improvement process that applies lean thinking to problem-solving (Flinchbaugh, 2012). It is an approach to present a comprehensive yet organized report on a single page. This tool is considered useful in the early stages of preparing to implement lean thinking onto problem-solving.

This methodology allows showing the key and essential information about a given problem or set of problems, which must be perceptible in a short period of time and outlined on an A3 sheet, presenting different structures in the scientific literature, but all of them are based on in the PDCA cycle (plan, do, verify, act). (Pereira, Silva, Bastos, Ferreira & Matias, 2019, p. 746)

A3 building blocks can be categorized into (1) history, (2) current condition, (3) objectives/goals, (4) analysis, (5) proposed countermeasures, (6) implementation plan and (7) follow-up. However, A3 is more of a way of thinking than a standard document format (Rini, 2021). Thus, the basic elements in the A3 report can be adjusted according to the needs and conditions of each company.

This methodology is described by Priori and Saurin (2020, p. 64) as “…a systematic problem-solving guide, through consensus between the affected parties, which documents the main problems of a process and proposals for improvements”. Generally speaking, the A3 report is used to structure, summarize and document a thought process (Sobek & Jimmerson, 2016).

The A3 process emerged at Toyota as part of the Toyota Production System (TPS) in the 1960s to summarize the activities of the improvement circle or Kaizen (Dennis, 2007).

The A3 method is primarily used for collaborative problem-solving, status reporting and proposal submission (Dennis, 2007). It is currently widely applied as part of the implementation of the LPS in different sectors, perhaps because of the good results achieved by its application, combined with the simplicity of the methodology (Bassuk & Washington, 2013). This approach was applied in research center improvements (Bassuk & Washington, 2013), showed excellent results when implemented in a pathology laboratory (Yorukoglu et al., 2017), was implemented in a hospital emergency (Priori & Saurin, 2020), had a successful implementation in the flexography sector of a plastics company (Pradella, Grando, Ely & Turatti, 2015) and generated excellent results in an automobile industry (Grilo, Oliveira & Junior, 2016).

As seen earlier, the A3 thought process is generally based on the Shewhart cycle (1931) PDCA for problem-solving and continuous improvement. According to Rosa, Silva, and Ferreira (2017), the PDCA is a tool or technique of the LPS and is used as a support to identify opportunities to reduce waste and increase efficiency. For Jiang, Sun, Ji, Kabene and Keir (2021), the PDCA, also known as the quality cycle, checks the result of a process, summarizes and analyzes the cause of failures, and starts a new PDCA cycle to improve the process. This creates a flow that the authors call an “endless cycle of scientific quality management and control”. Song and Fischer (2020) understand that PDCA is a control structure for the execution of a series of improvement activities that emerged in the industry. The fact is that the PDCA tool became popular and has shown such good results that it left the industry scope and is now applied to a wide range of processes.

During the A3 development process, several tools that are part of lean thinking are used. In the analysis phase of the problem root cause (4.4), the methodology called “5 whys” is used. The “5 whys” method is a scientific approach used in the Toyota Production System to get to the real root cause of the problem, which is usually hidden by obvious symptoms. The “5 whys” analysis is a tool for solving problems. The “5 whys” help to identify the root of a problem or the cause of a discrepancy in the production process, in order to find preventive actions to minimize the ineffectiveness of the production process. It consists of asking the question “Why” five times to understand what happened (the root cause). According to Weiss (2012), for the analysis of the “5 whys”, although it is called that way, less “whys” can be used (three, for example), or more “whys”, according to the need to find the root cause. It uses a specific set of steps, with associated tools, to find the root cause of the problem, so it ispossible to (1) determine what happened; (2) determine why this has happened and (3) figure out what to do to reduce the probability of it happening again.

In the phase called “propose countermeasures”, the 5W2H tool is used. This tool was created by professionals from the Japanese automobile industry to be used as an auxiliary tool in the use of the PDCA (Silva, 2013). Polacinski, Raquel SassaroVeiga, Tauchen, and Pires (2013) describe that the 5W2H tool consists of an action plan for pre-established activities that need to be developed as clearly as possible, and maps them through the central objective of 5W2H tool, which is to answer seven basic questions and organize them, namely what; where; why; when; who; and the 2H are how and how much.

1. What: What action (countermeasure) will be taken?

2. Where: Where will the action (countermeasure) be taken?

3. Why: Why will the action (countermeasure) be taken?

4. When: When will the action (countermeasure) be taken?

5. Who: Who is responsible for this action (countermeasure)?

6. How: How will the action (countermeasure) be carried out?

7. How much: How much will it cost to carry out the action (countermeasure)?

In this paper, a case study of the implementation of A3 methodology is presented in an industry of the motorcycle-producing in the two-wheel sector. The focus of the study was to understand how to use A3's problem-solving methodology to make improvements and develop people's mindsets.

This technological paper is composed of the following parts: context and investigated reality, in which the environment where the case study took place will be contextualized; diagnosis of the problem situation, that will clarify the problem the company is facing, the improvement cycle and the tool that will be used to solve the problem; analysis of the problem-situation and improvement proposal, which will explain the methodology that will be used and its use; conclusions and technological contribution – at this stage the conclusions will be described, as well as the contribution of this work and its limitations.

2. Context and the investigated reality

This technological paper aims to present an improvement project using the A3 methodology implemented in the machining sector, in an industry within the two-wheel sector (production of bicycles and motorcycles) at the Manaus Industrial Pole (MIP).

The industry under study has Japanese origin, has 1,600 employees, produces 88 models of motorcycles, and sells to the domestic and export markets.

The 2wheels company's production process is quite vertical and comprises the following production processes: casting, machining, stamping, aluminum painting, metal painting, plastic painting, welding, engine assembly and chassis assembly. The focus of this paper was on the machining process.

3. Diagnosis of the problem situation

Due to the expected increase in sales in 2020, the company under study identified in its sales and operation planning (S&OP) process that several production processes would lack the production capacity to meet the new forecast. For some processes, the solution to the problem was easy, as it was about increasing the number of people. However, for other processes, the solution was more complicated as it would be necessary to add shifts or buy machines, which would increase costs and the need for investments.

The worst situation was the machining process, as it already worked in two shifts, and the addition of the third shift would make the company incur several additional costs such as cafeteria operation, transport, emergency medical service, labor engineer, payment of night hours, among others. It would be the only area of the company that would work in three shifts.

An additional factor was that, when working in three shifts, there would be no alternative for production recovery in case of any problem that would generate a production plan delay.

During a preliminary study carried out by industrial engineering, it became clear that it would be possible to meet the new demand by keeping the two shifts if the machining process could reduce the machine setup time. This would increase the productive capacity.

Thus, to solve this problem, the methodology chosen was the A3 report for problem-solving, as it is an approach that the company intended to use to foster a culture of problem-solving and operational improvements, in addition to promote the development of exceptional people and teams who could follow the approach based on the LPS principles.

4. Analysis of the problem situation and proposal for improvement

To analyze the problem and propose a solution for it, the method applied was action research in the form of a case study. According to Melo, Filho, and Chaces (2016, p. 154) “action research is widely used by researchers in the human and social sciences… the research modality has a cyclical character, which means that there is a joint action between researcher and subjects from the admission of the initial question to the effects resulting from the study to action research”. A case study, on the other hand, “is a research strategy that absorbs specific interpretations of data collection and analysis, helping senior management in decision making” (Yin, 2010, p. 15).

Aiming at a multi-disciplinary approach in solving the problem for this project, a team was formed under the coordination of one of this study authors, in the role of an internal consultant. Thus, all areas of the company that were somehow related to the analyzed value stream were called. With this, a multi-functional group was created, made up of people from the machining process, from the tooling area and from the maintenance area.

The methodology followed for solving problems encompassed 8 steps, according to the following steps. These steps were defined internally by the company with the participation of the authors of this paper.

1. 1: Define the problem;

2. 2: Understand the problem;

3. 3: SMART targets;

4. 4: Root cause analysis;

5. 5: Countermeasures;

6. 6: Measurement result;

7. 7: Standardization;

8. 8: Reflections.

As a general criterion used in this case study, before deciding to open an A3 problem-solving report and starting to work on each of the steps of the proposed methodology, it is necessary to check whether the A3 approach is the best methodology to solve the analyzed problem. In order to use the A3 methodology in the 2wheels company, four questions were defined: (1) Is the problem repetitive? (2) Do they have historical data on the problem? (3) Are the actions necessary to solve the problem within the company's autonomy? (4) Do the solutions positively impact the organization?

If the answer is “yes” to all four questions, continue with A3; if not, it is necessary to use another problem-solving or project approach outside the scope of this paper.

Each step of the A3 methodology adopted is described below:

5. Conclusions and technological contribution

As demonstrated in the analyzed case, the A3 approach to problem-solving is critical for any industry, regardless the company size, as it allows improving internal communication between levels of the organizational structure, in addition to being the basis for implementing a culture of continuous improvement of company's processes through the development of people. Moreover, this A3 methodology made it possible to use the PDCA cycle to improve processes in order to define the problem, present clear goals and objectives, as well as allowing an alignment between the analysis of the causes of the problem, the action plan and the monitoring of project indicators.

Different authors (Herzog & Tonchia, 2014; Girardi & Tortorella, 2015; Priori & Saurin, 2020) claim that the implementation of lean production tools in a company can reduce waiting times, costs, defects and improve material flow. All these goals are very important for companies to survive in an environment as competitive as the current one. However, despite these benefits, studies published on the topic focus only on the issue of improving the efficiency and cost reduction of processes (Pradella et al., 2015; Grilo et al., 2016; Yorukoglu et al., 2017).

The main theoretical contribution of this technological paper is to empirically demonstrate the two most important guiding principles of LPS: (1) waste elimination and (2) people development (Liker & Franz, 2013). Regarding the principle of eliminating waste, which is the focus of great part of the studies published on the subject, it is related to the elimination and reduction of activities that do not add value – only costs – in order to improve efficiency and reduce the processes costs. This was demonstrated by the 2wheels company project, which initially had the purpose of creating the third shift and the various costs and expenses associated with it. For this, the improvement team, after defining the problem, chose as its objective the reduction of the setup time of the machines in machining line 2. The reduction obtained was 45 min, and this improvement was then implemented in all the machines in this process (total of 140 machines).

The second theoretical contribution of this technological paper was to make clear the need to develop people through the PDCA. The objective of the improvement cycle is not just process improvement (waste elimination), since PDCA is much more than a way to obtain results with process improvement, it is a way to develop people (Liker & Franz, 2013). This is important because the “just do it” mentality destroys the PDCA cycle. The mindset should be to use PDCA as a way of thinking and learning, as great people and great processes go side by side to achieve operational excellence.

A third theoretical contribution of the paper is related to the presentation of a new A3 methodology for application in improvement cycles, consisting of 8 steps, instead of 6, as in the models used in other studies (Sobek & Jimmerson, 2016), without the need to use lean philosophy practices (Rother & Shook, 2012). The traditional A3 report template consists of 6 steps described on two pages. The first page represents the left side of the A3 template, describes the current state, consisting of: (1) theme and context, (2) current condition and (3) root cause analysis. The second page represents the right side of the A3 model, describing the future state with the planned improvements, consisting of (4) target condition; (5) implementation plan and (6) indicators. The difference is that in the proposed method there are (8 steps.

At the last stage of the A3 methodology, we sought to identify what worked well during the tool application process, what did not work as it should, what was learned by the team during the process, what could be improved, and which other areas of the company could use what was learned and the improvements implemented. This is a basic principle of LPS that considers that if a person is not challenged and is not learning, he or she is not being respected. So, one needs to standardize what works, share learning and identify more issues for PDCA.

Regarding its practical contribution, we consider, first, that the proposed method can also be applied to small and medium-sized companies (SMEs), since the investment in this problem-solving approach is low, without necessarily implementing LPS, which is generally complex, time-consuming and requires the allocation of a substantial amount of resources by companies (Herzog & Tonchia, 2014).

The second practical contribution of this work is that the proposed A3 problem-solving methodology can serve as a guide for managers to implement or improve different industrial and service processes, whether in SMEs and at the same time it may be used for the development of people using PDCA methodology.

In summary, the proposed A3 problem-solving report is a very useful tool for the organization. It simultaneously documents the key results of problem-solving efforts in a concise manner and incorporates a complete problem-solving methodology that starts with a deep understanding of how the job actually gets done. When properly implemented, this approach allows the organization to move toward a systemic view rather than point optimization, as the problem-solving team seeks information and, ultimately, consensus from all parties affected by the proposed change.

However, the improvement cycle using A3 problem-solving methodology was implemented in a single company, so its result can be considered a limiting factor for this study. Therefore, as a suggestion for further work, it is recommended to apply the procedures adopted here (A3 model with its eight phases) to different SMEs, specifically, the A3 model with its eight phases, based on contingencies and most relevant business objectives for improving the performance of processes, in order to carry out a comparative study with this paper.

We hope, however, that this technological paper may help to fill some of the gaps that exist in the literature on this topic, and that it may be useful to managers who face similar problems.