Incremental Innovation and Organizational Structure:

Field Research in the Japanese Auto Industry and Computer Simulation Analysis

Abstract

Existing studies have argued that incremental innovations, such as kaizen, are rather normative and always driven by workers and work teams. This paper challenges this stereotypical image of kaizen as incremental innovation; it clarifies that kaizen consists of a series of various individual improvements of different sizes. Furthermore, the paper discusses that some improvement projects require coordination beyond the working groups. For these reasons, it is required for managerial decisions to choose the size of innovations a firm should concentrate on and the type of organizational structures a firm should select for kaizen.